Czech Republic

Employer of Record in the Czech Republic

Skuad’s Czech Republic Employer of Record (EOR) solution helps your business expand without the need for an entity setup. Our unified and automated global human resource (HR) platform enables you to expedite the onboarding of your remote team and manage their payroll, benefits, taxation, probation, and termination in compliance with local laws. In addition, we help you streamline the global expansion process with the able assistance of our international network of experts from over 150 countries. Book a demo with Skuad to kick-start your expansion into the Czech Republic.

The Czech Republic at a Glance

Population: 10.5 million 

Currency: Czech koruna (CZK)

Capital: Prague

Languages: Czech

Gross Domestic Product (GDP): USD 290.57 billion 

Learn more about expanding your business into the Czech Republic by partnering with Skuad.

Employment in the Czech Republic

What You Should Know Before Employing in the Czech Republic

The International Labor Organization (ILO) governs employment laws in the Czech Republic. The Czech Republic’s labor laws state the process of establishing employment relations in the country.

Let us explore the Czech Republic's employment laws to understand the entitlements such as employee benefits, working hours, paid time-offs, and national holidays.

To ensure your expansion endeavors are in compliance with the Czech Republic employment laws, Contact Skuad today.

Contractors Vs. Full-time Employees

Employment contracts in the Czech Republic are duration-based. The two types of employment contracts are,

• Indefinite duration contracts
• Temporary duration contracts

When the workers continue to work after the expiry of the temporary duration, the contract becomes permanent. If a fixed-term contract is renewed for longer than three years with the same employer, it is considered permanent automatically.

However, a fixed-time contract is only permitted for objective or material reasons when a limited-duration task must be performed.

All contracts should be in writing. They should contain the following three details.

• Starting date
• Type of work
• Place of work

There are several advantages to hiring contractors and full-time employees.

Advantages of Hiring Contractors

• Flexibility: Since contractors are hired on a short-term basis, you are free to determine the scope of their work temporarily. If new needs arise, further contracts can be drafted in the short term.
• Independence: Short-term contractors usually work independently. They do not require close supervision and your resources can be transferred elsewhere, as needed.
• Cost: Hiring contractors may be cheaper in the long run, although their individual rates are higher than those of full-time employees. This is because such employees are not entitled to employment benefits such as bonuses and tax compensations.

Advantages of Hiring Full-time Employees

• Loyalty and organizational commitment: Full-time employees are likely to be more loyal as they exclusively work for your company. As their individual success depends on the performance of your firm, they are likely to invest more effort into their work.
• Knowledge: All employees undergo training when they join a firm. The skills and knowledge gained by a full-time employee, however, stay within the organization.
• Legal freedom: Since full-time employees are defined as such in their contracts from the outset, misclassifications can be avoided completely. When hiring full-time employees, you determine the terms of the contract and entitlements, and these are not liable to change unless mutually decided by both parties.

Learn more from Skuad experts about the pros and cons of hiring contractors and full-time employees in the Czech Republic.

Hiring in the Czech Republic

Hiring employees in the Czech Republic is a tedious process, as it requires you to scout for the right talent, vet the candidates, conduct screening and interview rounds, and recruit them. An EOR service such as Skuad can take care of all compliance-related matters for you while providing you with a pre-vetted pool of talent from which to hire.

Most employers in the Czech Republic advertise for job openings in newspapers such as Metro. However, the most popular platforms for job postings are websites and online portals, including,

• LinkedIn
• Volnamista
• Job.cz
• Prace.cz
• Profesia

Additionally, the hiring policies strictly prohibit discrimination on the grounds of

• Race
• Ethnicity
• Nationality
• Gender
• Sexual orientation
• Age
• Disability
• Beliefs
• Religion
• Union membership

The best way to onboard employees is by outsourcing the hiring process according to the Czech Republic's employment compliance requirements. As expansion into a new country is not a simple matter, companies need to put significant effort into business operations, sales, and other HR-related factors. An EOR service such as Skuad can save you time, labor, and resources, allowing you to focus on the business side of expansion in the Czech Republic. Talk to Skuad experts to know more.

Probation & Termination in the Czech Republic

Probation Period

In the employment contract, the employer may include a probationary term of up to three months. The duration of the probationary period is determined by the nature of the job. Although it can be shortened, it cannot be extended past three months.

Termination of Service

An employment contract may be ended by

• Agreement
• Notice
• Instant termination
• Termination during the probationary period

If the contract is terminated by the employee, they must serve a notice period of two months.

The employer may also terminate the contract. However, the conditions for doing so must be specified.

Severance Pay

If an employee is dismissed on “organizational grounds,” they are entitled to the following severance pay.

• One month’s pay if the employer-employee relationship lasted less than a year.
• Two months’ pay in cases when an employer and employee relationship lasted at least one year but less than two years.
• Three months’ pay in cases when an employer and employee relationship lasted at least two years.

To ensure your expansion endeavors adhere to the laws regarding probation and termination in the Czech Republic, talk to Skuad experts and book a demo today.

EOR Solution in the Czech Republic

Establishing a successful enterprise in a different country requires expert intervention, as it is nearly impossible to know the varied compliance policies of the country. With their team of experts, EOR services can simplify your task of conducting business globally. Their extensive research on the country’s laws and HR policies ensures business expansion at a faster pace. An effective EOR service manages the entire life cycle of the employees. They handle complex HR-related matters and let you focus on your core tasks. Employers of record companies in the Czech Republic facilitate hassle-free business expansion.

Payroll Outsourcing in the Czech Republic through an Employer of Record

Hire talent from all over the world and improve your business prospects with Skuad’s platform for managing globally distributed teams. Skuad has a high-tech, unified HR platform for businesses to manage and pay their remote teams. Some of Skuad’s primary functions are,

• Talent discovery: We discover exceptional talent and skills to onboard the employees for the companies.
• Updated EOR: The tech-enriched HR platform enables seamless and easy control over the hiring procedure, including onboarding, paying, and managing the hiring process.
• Local compliance: Not limited to the hiring process only, we release you from the hassle of complying with the local laws to create entities and manage taxes.
• Conducting formalities: We help in creating a suitable employment contract, following all the legal provisions of the land, and ensuring an easy collection of documents for taxation.

We can offer tailor-made EOR solutions for all your expansion needs in Czechia. To avail yourself of our services, speak to Skuad experts today.

Types of Visas in the Czech Republic

Whether for relocating employees or hiring new employees, the employers and employees must make sure that they have a work visa that complies with the country’s labor laws. There are different visas that the Czech Republic offers for people willing to enter the country. These are as follows.

1. Schengen Visa (up to 90 days)

This is a short-term visa issued for: 

• Tourism
• Medical treatment
• Business
• Culture
• Sport
• Visits by invitation
• Official or political reasons
• Study
• Internship
• Scientific research
• Employment
• Seasonal employment
• Training

2. Long-Term Visa (over 90 days)

A long-term visa is issued for,

• Medical treatment
• Culture
• Sport
• Visit by invitation
• Official or political reasons
• Family
• Studies, internship, or volunteering
• Working holiday
• Seasonal employment
• Training
• Entrepreneurship

3. Long-Term Residence Permit

These are issued for,

• Employment, in the form of an Employee Card, Blue Card, or Intra-Corporate Transfer Card
• Investment
• Family unification
• Study
• Scientific research

As an EOR service for the Czech Republic, Skuad takes care of all the requirements and responsibilities related to employment, including applying for and obtaining visas. Get in touch with Skuad experts to learn more.

Work Permits in the Czech Republic

People with temporary or permanent visas can work in the Czech Republic. Anyone who completes the visa application process and provides all the documents mentioned in the above section can get work permits in the Czech Republic.

The Czech Republic work permits for foreigners can be obtained by presenting the documents required for work visa processing to the consulate. However, if the worker wants to stay for a long time, they must apply for a long-term residence visa.

Apart from the above documents, the worker might require documents specific to the job role or the activity they will engage in the country. As the employer, you have to submit the following documents on your employees’ behalf.

• Identity proof
• Permanent address proof
• Identification information of the company
• Details on the location, duration of work, and kind of work
• Declaration of employment (employment guarantee)
• Copies of academic and professional degrees and certificates, duly notarized
• Admission fee payment receipt

Securing work permits is an essential task of Skuad’s EOR services. Partner with us today to expedite your expansion in the Czech Republic. To learn more, book a demo.

Payroll & Taxes in the Czech Republic

Payroll in the Czech Republic

To recruit employees in the Czech Republic and manage their compensation and other benefits following the local labor legislation, foreign companies must set up a payroll. This can be done in one of the following four ways.

• Incorporating a separate legal entity and handling the payroll management internally with an in-house HR department.
• Setting up a remote payroll by adding your Czechian employees to your parent company’s payroll.
• Payroll outsourcing in the Czech Republic in collaboration with a local company that handles HR tasks but leaves you in charge of liabilities.
• Payroll outsourcing in the Czech Republic with a global EOR service such as Skuad, which can handle your payroll while ensuring total compliance with the local laws.

Taxes in the Czech Republic

Employer Taxation

Employee Taxation

To understand how payroll and taxes are managed in the Czech Republic and expedite your expansion process, talk to Skuad experts and book a demo.

Bonuses

Bonuses are popular, with a 13th-month bonus and performance-based remuneration being awarded.

Incorporation: How to Set Up a Subsidiary in the Czech Republic

If you wish to expand into the Czech Republic, the first step would be to set up a subsidiary, without which the company cannot make a legal presence in the country. There are several factors that you must consider to expand your business in the Czech Republic. The steps for setting up a subsidiary in the Czech Republic are as follows.

Know more about setting up a subsidiary in the Czech Republic with Skuad’s potent EOR solution.

Professional Employer Organization (PEO)

A professional employer organization (PEO) in the Czech Republic manages all HR-related functions, such as employee benefits, payroll management, taxes, and risk management. A PEO firm acts as a co-employer while an EOR firm acts as a legal employer.

Although an EOR service provides similar services to companies, there are certain differences between the two.

• EOR companies become the legal employers of employees instead of the co-employers. An EOR firm has all the liabilities and responsibilities of the employees. A PEO retains your organization as the legal employer.
• With EOR solutions, the employees are covered by the insurance plan of the EOR firm. With a PEO, you will have to opt for a plan by yourself.
• With an EOR firm, you need not register your company in the country or set up an entity. The same is not true for a PEO.

Skuad's EOR solution is a good way to expand your business in the Czech Republic without setting up a separate entity. Our solutions help you to stay focused on your business and leave all business compliances, payroll processing, and complete management work to us. Connect with Skuad to know more.

Conclusion: What Gives Skuad’s Czech Republic Solutions an Edge?

Expand your business into the Czech Republic while complying with all the labor laws of the country with Skuad’s effective EOR solution! We help you handle the complexities of business expansion with ease and create a profitable business enterprise by creating a global presence.

With a pool of pre-vetted, “ready to hire” talent, Skuad offers to set up a team for you without delay and expedite your expansion. We can take care of all HR tasks for you, including recruitment, hiring, onboarding, payroll, taxation, probation, termination, visa, work permits, and setting up a subsidiary. All our operations are conducted on our high-tech, unified HR platform, and we have a strong network in over 150 countries.

We offer consistent prices irrespective of the location and manage the payment of your team through a single invoice. We also ensure that your IP, invention rights, and sensitive employee details are fully protected wherever you operate.

Book a demo with Skuad experts today to know all about expansion to the Czech Republic.

FAQs

1) What is the employer of record in the Czech Republic?

An Employer of Record in Czech becomes the legal employer for your staff, handling everything from payroll and taxes to labor laws and HR. This lets you hire top Czech talent without establishing a local entity.

2) What does it mean to be an EOR?

An Employer of Record streamlines the process of hiring. They act as your legal employer, handling payroll, taxes, and benefits for your workers. This lets you hire top talent without setting up a local entity.

3) What is an EOR agreement?

An Employer of Record agreement formalizes the partnership between your company and an EOR service provider.  The agreement states the the EOR's legal employment responsibilities for your overseas staff which include tasks like payroll processing, tax withholding, and benefits administration.

4) What does an employer of record do?

An Employer of Record acts as your legal employer for overseas staff, streamlining international hiring. They handle HR complexities like payroll, taxes, and benefits administration in your target country, eliminating the need for a local entity setup.

5) What is the EU employer of record?

An EU Employer of Record acts as your legal employer in Europe, simplifying workforce management. They handle HR tasks like payroll, taxes, and legal compliance across borders. This lets you hire top European talent without setting up local entities in each country.