Czech Republic: Two Distinct Instances of Temporarily Assigning Employees Under the Czech Labour Code

Author: Klára Šléglová

The concepts of general temporary assignment governed by Section 43a of the Czech Labour Code and agency employment share similar aspects. Nevertheless, the Czech Labour Code distinguishes them significantly and regulates their relationship to prevent their misuse in practice.

 

Temporary Assignment 

Temporary assignment allows the employer to provide their employee for performance of work to another employer for a limited time, following an agreement between both employers and between the employee and the original employer. The original employer cannot obtain financial gain from such assignment (however, reimbursement of costs is possible, e.g., salary or travel expenses). For its duration, the second employer organizes and controls the work, while the employee remains paid by the original employer. An employee cannot be temporarily assigned until at least 6 months after the commencement of employment with the original employer.

Both employers must ensure that the work and salary conditions of the temporarily assigned employee are not worse than those of a comparable employee, reflecting the equal treatment principle enshrined in Section 16(1) of the Labour Code. In a recent court decision (File No.: 21 Cdo 351/2024), the Supreme Court ruled that supplementary pension insurance provided to permanent employees falls within the scope of comparable working conditions. Given that the statutory wording concerning comparable working conditions is identical for both temporary assignment and agency employment, this ruling is expected to apply to agency employees assigned to a user employer as well. This decision is particularly significant as it contradicts the existing methodological guidance of the General Labour Inspectorate.

 

Agency Employment

Agency employment can only be carried out by an entity holding a special permit. The agency concludes an employment relationship with an employee, then enters into a written agreement with another employer (the “user”), undertaking to temporarily assign the employee. The employee receives a written instruction on the assignment, including the term (maximum 1 year), place of work, and the authorized managerial employee. The user pays the agency a fee covering both remuneration and agency costs. The agency must not assign an employee to a user employer that has already entered into an employment contract with the employee.

 

Relationship Between The Two Concepts

Provisions concerning temporary assignment cannot be applied to agency employment. Under temporary assignment, an employee initially performs work for their original employer, and only after a certain time period a change in the employment relationship occurs when the employee is temporarily assigned to another employer. In contrast, agency employment is designed from the outset for the agency to temporarily assign its employees to perform work for a user. Both parties (employers) commit to this temporary assignment from the beginning, and the contractual relationship is only perfected at the moment the temporary assignment is realized.

 

Key Action Points for Human Resources and In-House Counsel

• Employers may only temporarily assign an employee after a minimum of six months of employment, provided that the employer derives no financial benefit from such assignment.
• Agency employment is specifically designed to enable work agencies to temporarily assign employees to a user for the performance of work.
• The regulatory provisions governing temporary assignment are not applicable to agency employment relationships, which operate under a separate legal regime.