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What Changes Does the Labor Code Amendment Introduce?

What Changes Does the Labor Code Amendment Introduce?

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On the 30th of July 2020, or more precisely the 1st of January 2021, a long-awaited amendment to the Labor Code will come into force. Its aim is among others to facilitate the enforcement of employees’ rights, to facilitate communication between the employer and employee, to increase the flexibility of working processes or, for instance, to reduce the administrative burden of some obligations placed on the employer. The Labor Code amendment reflects a wide range of practical problems and regulates a wide range of important institutions. In this short summary, we will discuss the most significant changes that will be brought about by the amendment.

A change in the method of calculating leave

A key change implemented by the Labor Code amendment is legislation on leave, or more precisely on how leave should be determined. The calculation and taking of leave itself as of 01.01.2021 will be derived from the hourly regime of weekly working hours. The amendment cancels leave based on the number of days work is done, so that the length of leave can be determined in a fairer way.

From this point on the Labor Code will distinguish only between annual leave, its proportional part and supplementary leave. Therefore, the aforementioned types of leave that remain unchanged should be expressed in hours that correspond with the employee’s weekly working hours. The amendment also newly introduces the conditions for extending leave if an employee has worked more than 52 times the stated weekly working hours. In this case, leave will always be 1/52 times longer for each extra weekly working hours worked.

If the length of weekly working hours of an employee changes during the year, then the length of their leave is calculated as a ratio corresponding to the length of separate periods of time with different lengths of weekly working hours.

Furthermore, the list of particularly hard jobs (jobs at which employees are entitled to supplementary leave) will be expanded and the list will now include work during which employees come into contact with biological wastewater and waste. For that purpose, the period of performance of work does not include the periods stated in Section 216 par. 2 and Section 348 par. 1 of the Labor Code. Only the actual performance of work under the specified particularly hard conditions will remain relevant.

For leave purposes obstacles to work will be counted within the total limit, i.e. twenty times the given working hours in the relevant calendar year.

What the Labor Code amendment does not affect is the conditions for entitlement to leave, which should remain virtually unchanged.

A shared work position will allow employees higher flexibility

A substantial change introduced by the Labor Code amendment and integrated into the new Section 317a by the legislator is legislation on the novel institution of a shared work position. This amendment will enable employees to partly schedule working hours according to their availability and thus to balance personal life with working life.

The amendment considers a shared work position a situation in which two or more employees that perform the same type of work agree in written form to alternate with each other in performing one job in such a way that on the basis of their shared work schedule, they collectively fulfill the set weekly working hours (40 hours per week in most cases). The employees must fulfill the weekly working hours within no longer than a 4-week settlement period. The amendment also regulates the form and conditions for terminating an agreement on a shared work position.

New rules for the delivery of documents

Due to practical problems, the regulation of document delivery is also expected to change significantly. Primarily, the amendment specifies the delivery of documents into the employee’s hands at the workplace as the preferred form of delivery. Only if delivery at the workplace fails can the employer deliver the document to any place where the employee can be reached or proceed to delivery through the operator of postal services, the internet or an electronic communications service or data box.

In connection with this, the amendment explicitly enshrines the option of delivery via data box for both the employer and employee, if the other party expresses their written consent to this method of delivery. Nonetheless, considering the fact that most employees do not have data boxes, this method is expected to be less popular in practice.

At the same time, the employer’s obligation to deliver documents to the last known address of the employee falls away. Thus, the obligation is transferred to the employee, because now it will be the address that the employee informs the employer about in written form that should be considered relevant. The time for sending a document through the operator of postal services if the employee cannot be reached is extended to 15 days (as opposed to the previous 10 working days). If the employee does not collect the document within this time limit, the document is considered to be delivered on the last day of this period.

Transfer of rights and obligations arising from labour relations

Furthermore, the Labor Code amendment concerns the highly criticized regulation of the transfer of rights and obligations arising from labor relations. As opposed to the existing regulation that lacks clear limitations on application, the Labor Code amendment, following the example of the Directive, newly conditions the transfer of rights and obligations upon the cumulative fulfillment of the following requirements:

  • After the transfer, work is done in the same or similar way and to the same extent,
  • The work does not completely or predominantly consist in the supply of goods,
  • Prior to the transfer, there existed a group of employees that the employer intentionally established in order to solely or predominantly perform such work,
  • The work is not intended as short-term and should not consist of a one-time task, and
  • Property, or the right to use or enjoy it is transferred (if such property is essential for performance of the work, given the nature of the work), or a substantial part of the employees that the previous employer has used for the performance of such work is taken charge of (if that work to a great extent depends not on the property, but on the employees).

The transfer of rights and obligations to the next employer will not happen unless all of these conditions are fulfilled. The rule in question does not apply only when a special act stipulates that a certain commercial transaction involves a transfer of rights and obligations (typically a merger). Therefore, now in many situations involving outsourcing, insourcing, or upon a change of provider, the rights and obligations will not be transferred automatically.

In connection with a transfer, the Labor Code further implements a change in Section 51a of the Labor Code, which regulates the employee’s option to give notice to their existing employer so that the employee is not obliged to perform work. The new wording of the provision reflects two situations: first, when an employee is duly informed of the transfer of rights and obligations (i.e. pursuant to Section 339, no later than 30 days before the transfer). In this case, the employee is given only 15 days to give notice, which starts on the day when the employee is directly informed of the transfer, in which case their employment terminates at the latest on the day that precedes the day the transfer comes into effect.

In the second situation that is regulated in the new wording of Section 51a of the Labor Code, an employee is not informed of the transfer in time or is not informed of it at all. In this case, if an employee gives notice to the employer the day before the transfer comes into effect, the employment terminates already on the day that precedes the day of the transfer coming into effect. However, if an employee gives notice to the employer on the day when the transfer comes into effect or later, but no later than two months after the transfer comes into effect, the employment terminates after a 15-day notice period expires, which starts on the day when notice is delivered to the employer.

Conclusion

 The Labor Code amendment will bring about many significant changes, which particularly concern the new obligations of an employer when delivering documents, establishing the length of leave, the transfer of rights and obligations arising from labor relations and the posting of employees to provide services. The new legislation also introduces the institution of a shared work position, the aim of which is to support employees in balancing their work and personal lives. You can find out more about the Labor Code amendment in the recordings or our webinars at the following link: Novela zakoniku prace I. and Novela zakoniku prace II.

By Martin Murad, Senior Associate, and Adela Uhrinova, Junior Lawyer, Rowan Legal

Czech Republic Knowledge Partner

HAVEL & PARTNERS, attorneys-at-law, with offices in Prague, Brno, Bratislava, Pilsen, Olomouc, and Ostrava, has a team of 220 lawyers, tax advisors and 500 employees in total, is the largest independent law firm in Central Europe.

Our clients include large international companies, leading Czech and Slovak firms, including strategic state-owned companies and public sector authorities, as well as medium-size businesses, individual entrepreneurs, and investors. We advise approximately 100 of the Fortune 500 companies, and almost 50 of the Czech Top 100 companies. HAVEL & PARTNERS currently provides its services to a total of 2,000 clients. We have the most comprehensive international support available to both Czech and Slovak law firms. We provide legal and tax advice in 12 world languages in more than 90 countries around the globe. Up to 70 % of the transactions we deal with involve an international aspect.

HAVEL & PARTNERS was named the best law firm operating in the Czech Republic by the prestigious British rating agencies Chambers and Partners (2020) and Who’s Who Legal (2018, 2019). It is also the most successful law firm, providing the most comprehensive legal services in the Czech Republic and Slovakia, based on the total number of all nominations and awards in all years of the Law Firm of the Year awards. The firm became the absolute winner of this competition four times in the last six years, receiving the main award Domestic Law Firm of the Year in the Czech Republic (2015, 2017, 2018, 2020) and ranking as one of the most recommended law firms in all categories of law. Our company is also a three-time winner of the Law Firm of the Year award for Best Client Services (2015, 2016, 2019). In the field of M&A, HAVEL & PARTNERS is the best law firm in the Czech Republic based on the annual International Advisory Experts awards (2018, 2019). In Slovakia, it also won the prestigious global M&A Today Awards (2013–2018) for Mergers & Acquisitions six times in a row, and repeatedly won first place in the ranking by Lawyer International Legal 100 (2017, 2018). Prestigious international rating agencies EMIS DealWatch and Mergermarket have ranked HAVEL & PARTNERS among the leading law firms by the number of transactions completed in the entire CEE region since 2009. Based on annual awards of the Acquisition International magazine, HAVEL & PARTNERS has become the Law Firm of the Year 2019 in the M&A category in the CEE region.

Firm's website: https://www.havelpartners.cz/en/

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