Another amendment to Act No. 262/2006 Coll., the Labor Code (hereinafter referred to as the "Labor Code" or "ZP") is being prepared by the Ministry of Labor and Social Affairs. According to the information published by the Ministry of Labor and Social Affairs, its aim is to "implement changes that will lead to greater flexibility in basic labor relations while simultaneously strengthening the protection of the employee's position in these legal relations (flexicurity strategy), in response to demands primarily from social partners , and with regard to the development of the Czech legal system, the jurisprudence of the Czech courts and the Court of Justice of the EU."[1]
The amendment being prepared has undergone an external comment procedure, and it is therefore a question of whether, when and in what final form it will take effect. However, some of the planned news are so interesting that it is worth paying attention to them at least in this brief form. Considering its scope, this article does not aim to elaborate the subject in detail, but rather to draw attention to it and mention the questions that may be related to it.
One of the innovations that aims to fulfill the above-mentioned goals of the amendment is a new institute - the so-called top management employee. According to the upcoming amendment, this should be modified in the newly included § 12[2] of the Labor Code in the following wording:
(1) Based on an agreement between the employer and the employee, the top management employee can only be
a) senior employee in an employment relationship in direct management
1. of the statutory body, if it is a legal entity, a
2. the employer, if it is a natural person, or
b) a senior employee, directly subordinate to the senior employee according to letter a),
on the condition that the employer has negotiated a salary with the employee listed under letter a) or b) and his average monthly earnings is at least CZK 100.
(2) The amount of the amount according to paragraph 1 is determined by the government by regulation, usually with effect from the beginning of the calendar year, taking into account the development of wages and consumer prices.
The second part of the amendment to the law concerning the senior management employee is incorporated into the proposed § 317b ZP, which stipulates deviations for the adjustment of working hours, remuneration and obstacles at work. According to the amendment being prepared, the provisions of § 78 paragraph 1 letter of i), § 93, § 96 paragraph 1 letter a) point 2 and § 114 ZP (that is, there should be no concept of overtime work for a senior management employee, nor rules for its implementation and remuneration, or the employer's obligation to record overtime work). This employee should be able to schedule his working hours up to 48 hours a week himself, even on days off (work performance beyond this scope will obviously not be overtime work). Furthermore, the provisions on the fixed weekly working hours and the maximum length of the shift should not be used for senior management employees. Provisions on remuneration for work on public holidays, night work and work on Saturdays and Sundays should also not be applicable. In all these cases, the top management employee is not entitled to salary, bonuses or compensatory leave. In addition, the top management employee should not be entitled to compensation for wages in case of so-called other important personal obstacles at work (what is meant by these is regulated by § 199 ZP in conjunction with Government Regulation No. 590/2006 Coll. as amended). However, even a senior management employee should not lose salary compensation for the period of the first 14 days of temporary incapacity for work (just for this purpose, the employer must prepare the distribution of the senior management employee's working hours into shifts).
The goal of the amendment is obvious – to support the flexibility of the employment of high-ranking managers, for whom it is neither desirable nor very feasible to regulate overtime work, on holidays or on Saturdays and Sundays. In fact, these employees now schedule their own work, and their approach to work and remuneration conditions are approaching the relationship between the statutory body and the company (they work when the situation calls for it, and not according to a predetermined shift schedule). However, the proposed intervention in the protection provided to employees by the Labor Code (newly included provision § 317b ZP) is substantial. The provisions of the Labor Code, which are not to be applied to the employment relationship of these employees, not only follow the issue of remuneration for work, but also safety and health protection at work.
The minimum requirements for safety and health protection for the adjustment of working hours are established by Community law through Directive 2003/88/EC of the European Parliament and of the Council of November 4, 2003 (hereinafter referred to as the "Directive"). This enables the introduction of an exception for senior management employees in Article 17 of the Directive, in which it states that it is possible to deviate from Articles 3 to 6, 8 and 16 of the Directive, subject to compliance with the general principles of protecting the safety and health of workers and if, due to special the nature of the activities in question is not measured by the length of working hours, or is not determined in advance, or can be determined by the workers themselves. Art. 3 to 6, 8 and 16 of the Directive regulate daily rest, the right to a break at work in case of working hours longer than six hours, the weekly rest period, the maximum length of weekly working time, the length of night work and the reference period. The proposed amendment to the ZP thus allows for these exceptions.
Defining a senior management employee using the already traditional definition of a senior employee and his direct relationship to the employer or statutory body fits into the structure of the ZP. An important limitation is that an employee can become a top management employee only if he agrees to it himself. Thus, only an employee belonging to the group of senior employees with whom a clause of revocation from the workplace can be negotiated can become a top management employee (see § 73a et seq. ZP).
However, there are two other conditions, namely the negotiation of a wage and the achievement of sufficient average earnings. A senior employee whose salary is determined unilaterally by the employer (typically a wage scale, which is a unilateral legal act of the employer) cannot meet the conditions.
Average monthly earnings must be at least CZK 100. The proposed amendment does not provide any additional guidance on the assessment of this criterion. When determining the average earnings, the provisions of Chapter XVIII of the Labor Code, i.e. § 000 et seq., are used. According to these rules, the decisive period is the previous calendar quarter, unless the ZP stipulates otherwise. It is therefore a question of when a senior employee can meet the condition of sufficient average earnings for the first time to become a top management employee and for how long the condition is considered fulfilled. The proposed wording of the amendment does not indicate whether the determined average earnings should be used retroactively when assessing whether or not the employee achieved the condition of sufficient income (average earnings) in the relevant period. Retrospective assessment would not make much sense, because upon finding that the average earnings in the relevant period did not ultimately reach the necessary limit, it would hardly be possible to retroactively revise the working conditions of the senior employee in question (e.g. pay him extra allowances for overtime work, which was not even recorded). . In addition, the draft amendment does not indicate whether the determination of sufficient average monthly earnings would mean the possibility of negotiating the position of senior management employee for a specifically defined period in the future (month, next calendar quarter or other period).
We do not consider the mentioned criterion set by an absolute number to be a good one, even for the reason that it cannot reflect the territorial differences in the earnings achieved in different regions. This institute may thus become unavailable to senior employees of smaller companies in regions where lower wages have been achieved for a long time, although the nature of this way of working will be the same as for employees of companies operating in regions with high wages. To clarify the definition of a top management employee, it would be more appropriate to use other means. We can be inspired, for example, by German law, in which a top management employee is defined primarily by the content of his activity, i.e. the conditions for inclusion in the category of top management employee depend on whether he is authorized to make independent decisions that significantly affect the company's operation and wages the point of view serves only as a supporting criterion[3]. If the condition should be a salary of a certain amount, it would probably be more appropriate, for example, to set a limit as a percentage of the total wages paid at a given employer in a certain period.
If the proposed change is approved, it will be interesting to see how it will be applied in practice. Another question is whether senior employees who meet the conditions will be motivated to enter into such an agreement, as both the flexibility (as far as scheduling of working hours is concerned) of such an employment relationship, as well as its remuneration, are obviously in favor of the employer. Employees do not bring any visible benefits, apart from the ability to schedule their own work.
Source: News epravo
The team of the Vych & Partners, s.r.o. law office
[1] MINISTRY OF LABOUR AND SOCIAL AFFAIRS. New Labor Code: What are we proposing and what do we want to enforce? Ministry of Labour and Social Affairs. Prague: Ministry of Labor and Social Affairs, [cit. 16.3.2016/XNUMX/XNUMX].
[2] The original § 12, together with other provisions of the Labor Code, was repealed without replacement as part of one of the amendments.
[3] § 5 Absatz 3 und 4 des Bertriebsverfassungsgesetzes
