Hire employees in Czech Republic
With Nomad Global Hire PEO / EoR (Employer of Record) services, you can easily hire employees in Czech Republic, without having to set up your own entity. No risk and fully compliant with HR support included
What to know about Czech Republic
Czech Republic has a dynamic digital and startup industry
Employer Tax
Estimated at 34%
Currency
CZK, Czech Koruna
Available Employee Benefits
Medical insurance, Meal Vouchers
Employee Tax
Incremental from 15% up to 23%
Payroll Frequency
Monthly over 12 payments
Main Universities
Charles University, Masaryk University, University of South Bohemia
Capital
Prague
Population
Circa 10.5 Millions
Available Contracts
Fixed Term Contract, Indefinite/Permanent
Czech Republic is a regional leader in Central and Eastern Europe for Innovation. As per StartupBlink, Czech Rep ranks 32nd worldwide and 4th in Eastern Europe. Startups are usually based, and the Talent as well, in the capital Prague and in the cities of Brno and Ostrava. With strong universities and a competitive employer tax system, Czech Republic attracts many investors and startups looking to implement international operations in Central and Eastern europe. If you want to do this, NOMAD can help you by hiring your employees locally, manage local contracts, payroll, benefits, equipment and compliance, through its network of Employer of Record partners
Payroll, Benefits & Tax in Czech Republic
- Average Salary in Czech Republic is 43,500 CZK per Month
- Employer Tax in Czech Republic is around 34%%
- This includes Social Security, Accident Insurance and Health Insurance
- Employee Tax in Czech Republic is incremental up to 23%:
- Income Tax is at a flat rate of 15% for the income up to 1,700,000 CZK
- Income Tax then steps to 23%% for the income in excess of 1,700,000 CZK
- Payroll Frequency in Czech Republic is Monthly over 12 months
- Termination can only be done for a valid cause in Czech Republic, see below
- Notice period is a minimum of 60 days although this can be shortened by mutual agreements.
- Bank holidays: there are 13 national holidays in 2023
- Maternity Leave in Czech Republic is up to 28 paid weeks. The Mother has to take 4 weeks before the birth date and must take the rest of the weeks after the birth of the child. During this time, leave is paid at 70% by the Social Security.
- Paternity Leave in Czech Republic is 7 days and have to be taken after the child’s birth. As with Maternity Leave, salary will be paid 70% by the Social Security.
- Parental Leave is up to 43 months in Czech Republic, and this can be shared between the parents however not simultaneously. Pay during Parental leave will be capped.
- Sick Leave is covered for up to 380 days. The employer will pay 100% of the salary during the first 14 days then it will be covered at 70% by Social Security.
- Statutory Leave is 20 days minimum per year. Employees must have been working for at least 2 months before being able to book days.
The Czech Labor Code is setting the framework for employment in Czech Republic. This covers all individual and collective working relationships, Compensation and Benefits, Workers rights as well as Leave (Sick, Parental), employment Termination and Discrimination.
Onboarding and Termination in Czech Republic
- Probation period are mandatory under Czech Labour Law
- Probation period in Czech Republic must be of a minimum of 2 months or 60 days, and ta maximum of 6 months/180 days
- You can hire through Fixed Term Contracts, Indefinite / Permanent contract or BtoB contracts
- Employment Contracts must be drafted in Czech but can also be in English (but then has to be both at the same time)
- Termination is Czech Republic is generally a straightforward process but still requires particular care, especially to document it all in writing. In order to be compliant, Termination can occur as such:
- By resignation of the employee
- By expiration of contract
- By the employer on grounds of disciplinary dismissal, failure to perform in probation period, unsatisfactory performance
- Fixed Term Contracts can be terminated without specific cause
- It is always advised to reach a Mutual Agreement to validate a Termination in Czech Republic
- The minimum notice period in Czech Republic is 60 days to a maximum of 180 days for Leadership roles
- Severance payments in Czech Republic are mandatory, even for bad performance, and depend on the length of Service. Amount is 1 month salary if the employee has one year of employment, 2 months for 2 years, 3 months for 3+ years
Fixed Management Fee
We charge a fixed monthly fee depending on the level of the salary of the hired employee
- Local Contract Management
- Payroll Management
- Tax and Compliance
- HR Support
Employee Nomad set up fee
Everything to get you started on Nomad and ensure piece of mind for you and your new hire
- Sign up to the NOMAD Services
- Benefits Setup (if available)
- Tax authority liaisons
- An additional Deposit of 1 full month salary cost will be required
Estimated Employer tax costs
Employer Tax in Czech Republic is estimated around 34% (may vary depending on circumstances)
- Social Security
- Public Health insurance
- Accident insurance
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