Flexi-amendment to the Labor Code 2025: what your HR or business owner needs to know

At the beginning of 2025, the Czech government approved a so-called flexible amendment to the Labor Code, which aims to increase the variability of labor relations, support the reconciliation of work and family life, and enhance the competitiveness of employers. The main changes include, for example, the possibility of "different" agreements during parental leave, guaranteed return to the original position, changes in the notice and probationary periods, and the expansion of summer job opportunities for 14-year-olds. For employers, the amendment brings greater freedom in setting conditions (e.g., guaranteed wages in the private sector are abolished), but also the need to update internal regulations and contracts. If you are not carefully prepared, you may face inspections and fines from the labor inspectorate as well as litigation with former employees.

Author of the article: ARROWS (JUDr. Barbora Kořenářová, office@arws.cz, +420 245 007 740)

Main changes to flexinova (as of April 1, 2025, and beyond)

• Work under agreement with parents: Employees on parental leave may now perform work for the same employer under an agreement on work activity (DPČ) or agreement on work performance (DPP) – and this may be the same type of work they performed before going on parental leave. For example, a human resources manager in a manufacturing company can now hire an employee on parental leave under a DPČ contract to maintain her professional experience (previously, it was not legally possible for an employee to earn money "on the side" in the same field after parental leave). This change significantly improves conditions for parents, as it provides motivation and facilitates their return to work. At the same time, a guarantee of return to the original position is also being introduced: if a parent returns to work before their child reaches the age of 2, they are entitled to their original position and workplace (previously, this guarantee only applied after maternity leave).

• Leave for contract workers: From January 1, 2024, people working on a contract basis (DPČ/DPP) – so-called contract workers – will be fully entitled to annual leave if they meet the legal conditions. This means that employers must also accommodate contract workers and calculate their vacation in the same way as for regular employees (at least after 4 weeks and 80 hours of agreed work per year).

• Flexible scheduling (self-scheduling): The Labor Code will allow employees to arrange their own work schedules under pre-agreed conditions. This self-scheduling has only existed for remote work or shared jobs, but now it'll be allowed in general (employees can agree when they'll work, while still following the legal limits for breaks, maximum shifts, etc.). In practical terms, this means that companies can offer even more flexible working arrangements—such as alternating or "split" shifts—but these must be contractually agreed upon and recorded (so that it is clear who worked when and for how long).

• Termination and start of the notice period: The notice period now starts on the day the notice is delivered to the other party (not from the first day of the following month). This means that as soon as an employee receives written notice, the period starts immediately. In practice, this means that employees can start their new job earlier and employers can fill the vacant position sooner. At the same time, an exception has been added: in the event of a gross breach of work discipline or failure to comply with the employer's legal requirements, the notice period may be shortened to one month (this right was not explicitly codified previously).

• Compensation for termination for serious reasons: If the employment relationship is terminated (by notice or agreement) due to long-term incapacity for work or injury (e.g., occupational accident, occupational disease), the employee will now receive special compensation corresponding to twelve times their average earnings, which will be paid from the employer's statutory insurance (previously, severance pay was always paid directly by the employer).

• Other changes: The Flexinova introduces the possibility of reducing daily rest to 6 hours in crisis situations (e.g., accidents involving the restoration of critical infrastructure); this reduced rest must then be compensated for on the following day. The maximum length of the probationary period is extended to four months for regular employees and eight months for managers, with both parties able to extend it by agreement. In addition, 14-year-olds (who have not completed compulsory schooling) can now perform light work during the main summer holidays, which provides opportunities for young people to take on temporary jobs. On the other hand, a ban on confidentiality regarding wages in employment contracts has been introduced (this increases transparency, see labor cost index).

(Note: In addition, the amendment simultaneously changes the law on unemployment benefits—for example, benefits in the first period will temporarily increase to 80% of the average wage. These changes are closely linked to the motivation to take up new jobs.

Practical impact on employers

These changes mean that your company will have to adapt its internal regulations and contracts. You will need to discuss and update the following points, for example:

• Employment contracts and agreements: For agreements on work performed outside of employment, check the section on vacation (the law now requires vacation to be calculated for contract workers as well) and consider whether you will take advantage of new parental rights (e.g., allow part-time work or agreements for employees on parental leave). Also check how you have dealt with the possibility of arranging home work/remote work – the flexible amendment does not change the existing "home office" arrangement, but introduces self-storage of hours, which you can incorporate into your guidelines on working from home or flexible workplaces.

• Termination and final provisions: To avoid misunderstandings, it is necessary to specify in employment contracts that the notice period actually starts from the date of delivery of the notice. Define internally the conditions for new short notice periods for gross misconduct (1 month) and entitlement to compensation for long-term sick leave. At the same time, let employees know how the new "unfitness for work" obstacle works.

• Recording working hours: If you plan to use self-scheduling, agree with your employees on how to record working hours, as you will still be required to keep records (e.g., to what extent the agreed schedule was adhered to). Similarly, you can update your internal guidelines on breaks and rest periods in case of emergencies—the daily rest period can now be reduced to 6 hours in exceptional cases.

• Salaries and bonuses: With the abolition of guaranteed salaries, you gain more freedom in your wage policy. You can set wages according to your own system (the minimum wage remains the legal minimum), but be careful to comply with the principle of equal treatment (you must not discriminate). Check your contracts to ensure that they do not contain confidentiality clauses regarding wages (this is now prohibited).

• Next: Set up a human resources (HR) system for newly authorized summer jobs for 14-year-olds (you will issue them a contract for work on a single-use or fixed-term basis, if you allow it) and verify that transitions to longer trial periods are in line with company policy. If you employ foreign workers, also keep an eye on changes to employment law, such as the digitization of processes related to the amendment.

Overall, HR staff and company management should check as soon as possible that all summary contracts, internal guidelines, and collective agreements reflect the new conditions. We recommend consulting with a lawyer or HR agency to thoroughly prepare you for the procedure in accordance with the applicable legislation.

Risks of unpreparedness: fines and disputes

If you do not comply with these changes carefully, you expose yourself to risks from labor inspections and lawsuits. The amendment to the Labor Inspection Act (effective from January 1, 2025) strengthens the powers of inspectors and introduces stricter penalties. For example, companies may be fined up to CZK 10 million (minimum CZK 50,000) for violating the Labor Code or the Švarc system, and the inspectorate may also order the offense to be published on the official bulletin board. Inspections are more targeted – recently, inspectorates have also been given new powers to make audio/video recordings and link up with the tax authorities.

Similarly, employees can file lawsuits if their rights are not respected. Labor disputes are common: according to statistics, proceedings concerning employee rights are among the most frequent (approximately 14% of disputes). For example, if you refuse to allow a parent to return to their guaranteed position or to work on a contract basis, you may face a claim for damages or a court order (the court now strongly protects returns from parental leave). An imprecisely worded contract can lead to errors in determining the probationary period or notice period, which courts sometimes penalize (see recent disputes over the notice period).

Warning: State control of working conditions is therefore becoming stricter. The "Švarc system" (employment concealed as self-employment) is being actively combated by inspectorates this year, and even self-employed persons can be fined up to CZK 100,000 for a fictitious contract. It is therefore advisable to prevent sanctions: make sure that you comply with everything in the law.

What should you do now with the flexinova in your company?

Do not delay the implementation of the new rules – have your contracts and internal regulations checked by a qualified lawyer or HR specialist. Update employment contracts, agreements, collective agreements, and rules (e.g., regarding family benefits, flexitime, or home office) in accordance with the new legislation. Train managers and HR departments so that they are aware of the new rights and obligations. Keep track of the effective dates of the changes and communicate them to employees (e.g., that notice periods are shorter, that parents on parental leave can work on a contract basis, etc.). This will ensure that your company is ready and that you avoid unnecessary fines or litigation.