Employer of Record in The Czech Republic

Hiring Employees in The Czech Republic With An EOR

Hiring in The Czech Republic can seem complex – but with the right facts and tools, it’s simple. This guide walks you through the local job market, shows how Employer of Record services guarantee compliance, and highlights the key labor laws you need to know.

Hiring Employees In The Czech Republic
Employer Of Record In The Czech Republic

Capital City

Prague

Currency

Czech Koruna

 (

)

Timezone

GMT +1

Payroll Frequency

monthly

Tax Year

1 January - 31 December

Employer Tax

33.80%

Languages

Czech

Jesse Weisz

R&D Analyst

Last Updated

September 12, 2025

In This Guide

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Employment Guide For Hiring in The Czech Republic

Looking to grow your team in The Czech Republic? It’s a great way to tap into new talent and fresh markets – but hiring across borders comes with its own set of hurdles. From understanding local labor laws to managing payroll and staying compliant, it gets complex if you don’t have local HR support.

Playroll’s full-service Employer of Record platform handles all the heavy lifting so you can hire confidently in The Czech Republic without setting up a local entity. In this guide, we’ll break down everything you need to know about hiring employees in The Czech Republic, including employment contracts, payroll, statutory benefits, and compliance with local labor laws.

What to Know Before Hiring employees in The Czech Republic

Minimum Wage: The statutory minimum wage in The Czech Republic is CZK 124.40 per hour.

Working Hours: The Czech Republic adheres to a standard work week of 40 hours, which translates to eight hours per day.

Labor Laws: An Employer of Record acts as the legal employer for workers in The Czech Republic, taking on key responsibilities to ensure compliance with local labor laws and regulations. 

Payroll Taxes: In The Czech Republic, employers contribute about 33.8% in payroll taxes, which typically cover social security, health care, and other statutory benefits.

Average Salary: The average salary in The Czech Republic is approximately CZK 49,402 (as of Q2 2025).

How to Hire Employees In The Czech Republic

Hiring in The Czech Republic for the first time can be overwhelming, especially when navigating unfamiliar employment laws. So, how do you get started? There are three main ways to hire in The Czech Republic: Set up your own legal entity, hire independent contractors, or use an EOR service to handle payroll and global HR for you. Below, we’ll walk you through each option in detail.

1. Set Up A Local Entity In The Czech Republic

Setting up a local entity in The Czech Republic is the traditional route for businesses that want to build a long-term presence in a new market. It allows for direct hiring, fine control over operations, and compliance with local labor laws.

That said, the process is rarely simple. It involves navigating complex legal structures, extensive registration procedures, ongoing payroll administration, and local tax obligations. Beyond the administrative burden, the costs of incorporation, maintaining local offices, and hiring compliance experts can quickly add up.

For companies operating with slim margins or testing new markets, these financial and operational commitments often make setting up a local entity an unfeasible option compared to more flexible and cost-effective solutions.

2. Use An Employer Of Record In The Czech Republic

An Employer of Record (EOR) acts as the legal employer for workers in The Czech Republic, taking care of compliance, payroll, and local labor regulations. This makes it fast and straightforward to bring on talent without the cost and complexity of setting up a local entity. For businesses looking to test new markets or scale teams across borders with confidence, EORs offer a flexible, low-risk solution.

The Employer of Record in The Czech Republic is responsible for:

  • Employment Compliance: Ensure all employment contracts comply with The Czech Republic's labor laws and regulations, including proper classification of employees.
  • Payroll Management: Calculate, process, and distribute employee salaries in accordance with The Czech Republic's payroll laws, including deductions for taxes and social security contributions.
  • Tax Filing and Contributions: Handle the registration, filing, and payment of employer taxes and social security contributions to the relevant authorities.
  • Employment Contracts: Draft and maintain compliant employment agreements, detailing salary, benefits, working hours, and termination terms in line with The Czech Republic's legal requirements.
  • Benefits Administration: Provide mandatory employee benefits as required by The Czech Republic's labor laws, such as health insurance, pension contributions, and statutory leave.

3. Hire Independent Contractors In The Czech Republic

Hiring independent contractors has boomed in popularity because of the cost savings and flexibility they offer. It can be a great option if you require niche skills or short-term project support. Contractors allow businesses to access specialized skills quickly, without the time and cost of setting up a local entity.

However, it’s important to know the limits of this model: contractors are not a substitute for full-time employees. Relying on them for ongoing, long-term roles can create serious compliance risks, including employee misclassification, which can lead to fines, back taxes, and reputational damage.

Playroll’s contractor management solutions make it simple to compliantly engage, onboard, and pay contractors around the world. We provide clear visibility into agreements, streamline payments, and reduce compliance risks – so you can focus on getting the work done. And when you’re ready to take the next step, we can help seamlessly convert contractors into full-time employees through our global Employer of Record service.

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Labor Laws in The Czech Republic

Businesses can only operate smoothly in The Czech Republic if they comply with local labor laws including drafting compliant employment contract agreements and meeting taxation and payroll obligations. Learn more about the employment laws and regulations in The Czech Republic below, to avoid any compliance issues.

Employment Contract Requirements

The legal structure in the Czech Republic requires both employers and employees to enter into a written employment agreement when hiring. This agreement must, at a minimum, encompass the following fundamental details:

  • Identification of both parties
  • Date of commencement (and employment duration for temporary contracts)
  • Workplace
  • Job type, duties and responsibilities
  • Basic salary as well as other compensation or benefits and detailed payment information
  • Working hours
  • Notice periods for employment termination
  • Reference to collective agreements
  • Health and safety measures at the workplace and company rules

Onboarding Process

We can help you get a new employee started in The Czech Republic quickly, with a minimum onboarding time of just 1-2 working days. The timeline starts once the employee submits all required information onto the Playroll platform and completes any necessary local authority registrations.

For non-nationals, the Right to Work assessment (if applicable) may add up to three extra days. Additional time may be needed for follow-ups on this assessment. Please note, payroll cut-off dates can impact the actual start date. Playroll's payroll cut-off date is the 10th of each month unless otherwise specified.

It is also worth noting  that pre-employment medical checks are required before an employee starts, but remote employees are generally exempt unless their role involves specific health risks.

Working Hours in The Czech Republic

The Czech Republic adheres to a standard workweek of 40 hours, which translates to eight hours per day.

Overtime in The Czech Republic

Overtime work is permissible but subject to restrictions, allowing a maximum of eight hours per week and 150 hours per year. For each overtime hour worked, employees must be compensated with an additional 25% of their standard hourly wage.

Probation Period in The Czech Republic

Probation periods in the Czech Republic are set at three months for non-managerial employees and six months for managerial employees. It's important to note that these probationary periods are fixed and cannot be extended beyond the initially stipulated duration

Average Salary In The Czech Republic

The current average gross monthly salary in the Czech Republic is approximately CZK 49,402 (as of Q2 2025). Salaries vary based on experience, industry, and location - entry-level roles earn less, while experienced professionals in fields like IT, finance, and engineering command higher wages. Prague generally offers the highest salaries, while rural regions tend to pay less. Economically, the country is seeing moderate growth (around 2.4% GDP), low inflation (near 2%), and a rise in real wages, signaling a stable and improving labor market.

Not sure what to pay in The Czech Republic? Compare fair, local salaries with our free benchmarking tool.
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Working Hours in The Czech Republic

Minimum Wage in The Czech Republic

How an Employer of Record Helps You Hire in The Czech Republic

Employment laws in The Czech Republic can be intricate, and even unintentional mistakes in contracts, benefits, or termination processes can carry legal and reputational consequences. With an Employer of Record, you gain a local partner that ensures every hire is compliant. The EOR takes care of drafting compliant contracts, processing accurate payroll, managing contributions to statutory benefits, and handling lawful terminations if needed, all according to local employment standards.

This level of protection is especially valuable when expanding into new or unfamiliar regions. Instead of using time and resources to build in-house legal knowledge, you gain immediate access to local expertise. The EOR keeps you ahead of regulatory updates and shields your company from potential compliance gaps, so you can confidently hire and manage employees while minimizing risk. For hiring managers and founders, it's the difference between hiring with uncertainty and building your team on a legally sound foundation.

Payroll Management in The Czech Republic

Fiscal Year in The Czech Republic

1 January - 31 December is the 12-month accounting period that businesses in The Czech Republic use for financial and tax reporting purposes.

Payroll Cycle in The Czech Republic

The payroll cycle in The Czech Republic is usually monthly, with employees being paid on the same day of each month as stipulated in contract.

Minimum Wage in The Czech Republic

As of January 1, 2025, the Czech Republic's minimum wage rates are as follows:

  • Monthly Minimum Wage: CZK 20,800
  • Hourly Minimum Wage: CZK 124.40

The Czech Republic's minimum wage is determined using a formula based on the average monthly gross earnings across the national economy. For 2025, the government applied a coefficient of 42.2% to the predicted average wage of CZK 49,233, resulting in the minimum wage of CZK 20,800 per month. This approach aims to align the minimum wage with the overall economic development and average wage trends.

Bonus Payments in The Czech Republic

In the Czech Republic, there is no legal obligation to provide a 13th-month salary. Nonetheless, numerous employers choose to offer a 13th-month salary bonus, often tied to performance metrics.

Employment Taxes in The Czech Republic

Employer Tax Contributions

Employer payroll contributions are generally estimated at an additional 33.8% on top of the employee salary in The Czech Republic.

Tax TypeTax Rate
Health Insurance9%
Social Security (applied on income above 2,234,736 CZK per annum)24.80%

Employee Payroll Tax Contributions

In The Czech Republic , the typical estimation for employee payroll contributions cost is around 11%.

Tax TypeTax Rate
Health Insurance4.5%
Social Security (applied on income above 2,234,736 CZK per annum)6.5%

Individual Income Tax Contributions

Czech employees are subject to an individual income tax, calculated at 15% of their gross salary up to 1,676,052 CZK and 23% for the portion of the gross salary exceeding this threshold.

Income BracketTax Rate
0 - 1,676,052 CZK15%
1,676,053 CZK And above251,407.8 CZK + 23% on amount above 1,676,053 CZK

Pension in The Czech Republic

Participation in pension insurance (důchodové pojištění­) is mandatory in the Czech Republic.

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The tax-related information provided in this guide is intended for general guidance and informational purposes only. Reach out to our dedicated team for insights on remote hiring in The Czech Republic tailored to your needs.

Employment Taxes and payroll in The Czech Republic

How an EOR Helps You Run Payroll in The Czech Republic

When you’re scaling quickly, setting up local payroll systems in each new country slows you down. In The Czech Republic, the administrative load can include government registration, benefits management, and accurate, on-time payment delivery. An EOR gives you a plug-and-play solution that handles all of this while your internal team stays focused on growth, not red tape.

Key Ways an EOR Supports Payroll in The Czech Republic:

  • Rapid Payroll Setup: Onboards employees quickly with ready-to-go infrastructure.
  • End Administration: Handles salary, tax, and benefits with no extra internal resources.
  • Vendor Simplicity: Consolidates payroll across countries for centralized oversight.
  • No Entity Required: Operates legally, saving your business the time and resources needed for local incorporation.

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Work Permits & Visas in The Czech Republic

In the Czech Republic, work permits and visas are essential for employers hiring non-EU/EEA/Swiss nationals. The main permits include the Employee Card for long-term employment, the Blue Card for highly skilled professionals, and the Intra-Company Transferee Card for employees moving within multinational companies.

The process requires submitting essential documents like a valid passport (with minimum 6 months validity), an employment contract, and proof of qualifications (translated into Czech and notarized). Employers are responsible for sponsoring these applications and ensuring compliance with local labor laws. Processing times typically range from 60 to 90 days for long-term visas, with study visas processed within 60 days, making it important to plan well in advance for a smooth hiring process.

Annual Leave & Company Policies In The Czech Republic

Mandatory Leave Entitlement in The Czech Republic

The annual leave entitlement in The Czech Republic is 20 days for a full time worker. These can include public holidays on top of that or within those days, which would otherwise be unpaid.

Public Holidays In The Czech Republic

There are 13 national holidays in the Czech Republic:

HolidayDate
Day of the re-establishment of the Independent Czech State - New Years Day1 January
Good FridayApril, exact date changes annually
Easter MondayApril, exact date changes annually
Labor Day1 May
Liberation day8 May
Day of the Slav Apostles Cyril and Methodius5 July
Death of Jan Hus6 July
Czech Statehood Day28 September
Independent Czechoslovak State Day28 October
Struggle for Freedom and Democracy Day17 November
Christmas Eve24 December
Christmas Day25 December
St Stephen's Day26 December

Paid Time Off in The Czech Republic

Employees in the private sector are entitled to a minimum of four weeks of paid annual leave each year.

Maternity Leave In The Czech Republic

In the Czech Republic, employed women with at least 12 consecutive months of work before childbirth can access up to 28 weeks (seven months) of paid maternity leave. Additional details include:

  • The leave can be taken within six weeks before the expected due date and eight weeks after delivery.
  • Maternity leave, funded by the state, equals 70% of the employee's average gross salary, calculated from the preceding year.
  • In the event that the mother gives birth to two or more children simultaneously, she is eligible for maternity leave for a duration of 37 weeks.

Paternity Leave In The Czech Republic

Fathers are eligible for 14 days of paid paternity leave within the first 6 weeks after the birth of their child. Paternity leave is compensated by the state at 70% of the father's regular salary, up to a maximum contribution of 8,575 CZK.

Sick Leave In The Czech Republic

In the Czech Republic, employees are eligible for sickness benefits for up to a maximum of 380 calendar days., with the following applicable details:

  • During the initial 14 calendar days of illness, the employer covers the payment
  • From the 15th day onward, Social Security benefits take over the coverage.
  • Sick pay is 60% of the employee's average wage in the Czech Republic.

Parental Leave In The Czech Republic

Parental leave can be taken by parents until their child turns 3 years old.

Care Leave

Employees are eligible for up to nine days of paid care leave to attend to a sick family member or provide care for a child under 10. Social Security reimburses this leave at 60% of the employee's gross salary for up to nine days.

Wedding Leave

Employees receive two days of leave for their wedding, one of which is compensated.

Bereavement Leave

In the event of the death of an immediate family member, an employee can take up to three days of paid bereavement leave.

Jury Duty

Employers are mandated to provide full-time employees with unpaid leave to fulfill their responsibilities as jurors, witnesses, plaintiffs, or defendants in court proceedings.

Annual Leave and Company Policies In The Czech Republic

Employee Benefits in The Czech Republic

Using an Employer of Record to Administer Benefits in The Czech Republic

For startups and small teams, managing global employee benefits isn’t just complex, it’s a full-time job. In The Czech Republic, understanding what benefits are required, how to deliver them, and how to stay compliant can be overwhelming, especially without local HR expertise. An Employer of Record removes that pressure by taking complete ownership of benefits administration, so you don't have to become an expert in local employment law.

Whether it’s healthcare contributions, pension enrollment, or statutory leave, the EOR ensures everything is delivered accurately and on time. They navigate any country-specific nuances, keep up with legal changes, and ensure each benefit is properly tracked and documented. For founders, that means fewer distractions and more time to focus on growth. Your employees get the security and support they expect from a local employer, and you get to scale your team in The Czech Republic without building complex infrastructure or worrying about compliance missteps.

Termination and Severance Policies in The Czech Republic

Employment Termination and Severance Policies in The Czech Republic

Termination Process in The Czech Republic

In Czech Republic, termination must be put in writing if the employer initiates the termination with the minimum notice period. In the case of indefinite-term contracts, the employer must provide a clear explanation for ending the employment. Employment may only be terminated for one of the following reasons:

  • Organisational reasons
  • Health reasons (where the employee can no longer carry out their present work due to loss of medical capacity)
  • Employee no longer meets the requirements outlined for the work
  • Gross breach of duty
  • Convicted of a crime
  • The employee has seriously, or less seriously but repeatedly, breached their duties relating to their work performance

Notice Period in The Czech Republic

In the Czech Republic, the notice period for both dismissals and resignations must be at least two months.

Severance in The Czech Republic

Severance pay is dependent on the employees length of service as specified below, and is only applicable in instances where contracts are terminated due to redundancy:

  • 1 year of employment: 1 months gross salary
  • 2 years of employment: 2 months gross salary
  • 3+ years of employment: 3 months gross salary

Disclaimer

THIS CONTENT IS FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE LEGAL OR TAX ADVICE. You should always consult with and rely on your own legal and/or tax advisor(s). Playroll does not provide legal or tax advice. The information is general and not tailored to a specific company or workforce and does not reflect Playroll’s product delivery in any given jurisdiction. Playroll makes no representations or warranties concerning the accuracy, completeness, or timeliness of this information and shall have no liability arising out of or in connection with it, including any loss caused by use of, or reliance on, the information.

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ABOUT THE AUTHOR

Jesse Weisz

Jesse is an experienced R&D Analyst at Playroll, a leading Employer of Record (EOR) provider. With a strong background in data analysis and market research, Jesse specializes in identifying emerging trends and driving innovation in global HR solutions. She is an all-rounder, critical thinker and success-seeker (often inextricably linked to being a late-night tea drinker).

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FAQs About Hiring in The Czech Republic

What are the standard employment terms in the Czech Republic?

Standard employment terms in the Czech Republic include working hours, leave entitlements, and conditions outlined in employment contracts, governed by labor laws and regulations.

What components are mandatory in Czech payroll?

Czech payroll includes gross salary, social security contributions, and income tax deductions. Employers must also contribute to social security and other mandatory funds.

What is the minimum wage in the Czech Republic?

As of January 1, 2025, the Czech Republic's minimum wage rates are as follows:

  • Monthly Minimum Wage: CZK 20,800
  • Hourly Minimum Wage: CZK 124.40

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