Czech Republic Payroll Services

Q: How does payroll work in the Czech Republic?

The standard pay frequency is monthly. Employees enjoy a flat rate of income tax, which currently sits at 15% with Employer Taxes at approximately 32%. Included within the Employer Tax are contributions towards Pension, Sickness & Unemployment Funds and Health Insurance.

Q: What are the general employment rules?

A working week in the Czech Republic consists of 40 hours. This is typically 8 hours per day but cannot exceed 12 hours. Overtime requires consent from both parties and must not surpass 8 hours per week and 150 hours per year. Maternity Leave entitlement in the Czech Republic is 28 weeks, with a minimum of 14 weeks that must be taken. Maternity Leave can start as early as 8 weeks before the due date but must be taken at least 6 weeks prior. For those who have multiple births, an extended Maternity Leave of 37 weeks is available.

Q: What about dismissing an employee?

As with many regions, a process must be followed in order to dismiss an employee in a compliant manner. We recommend speaking with one of our local Employment Experts prior to engaging in a dismissal. Typically, an employee is entitled to a Severance Payment which varies based on the length of their service: in most cases, it is 1 month’s salary for 1 year of service, 2 months’ salary for 2 years of service and 3 months’ salary for 3 years or more.

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Czech Republic Payroll Services

Hire employees in Czech Republic

Currency

Czech Koruna (CZK)

Population

10,693,939

Capital

Prague

Official language(s)

Czech

Date format

dd/mm/yyyy

Fiscal year

1 January – 31 December

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Czech Republic Payroll

Get peace of mind with a streamlined, fully-managed payroll solution for 1+ employees.

Czech Republic HR

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Czech Republic Payments

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Employing in the Czech Republic

In 2025, the minimum wage in the Czech Republic is CZK 20,800 per month. This will increase to CZK 22,400 in January 2026.

The Czech Republic applies a progressive tax system as follows:

Gross annual income up to CZK 1,676,052 (the bracket is calculated as 36x average monthly salary) is subject to a 15% tax rate.
Gross annual income exceeding this threshold is subject to a tax rate of 23%.

In the Czech Republic, the contribution paid towards the public pension system is 28%, with employer paying 21.5% of their employees’ payroll whilst the employee’s share is 6.5% of their earnings.

The standard work week in the Czech Republic is 40 hours, normally 8 hours from Monday to Friday. Any hours worked over the standard amount are considered overtime and usually compensated with either a bonus of at least 25% above the normal rate of pay, or by the equivalent time off in lieu.

Employee’s leave consists of several types including, but not limited to:

Statutory time off or paid leave, which is 20 days per year for full-time employees
Public holidays (there are 13 bank holidays per year in the Czech Republic)
Maternity, Paternity and Parental leave
Sick leave
Care leave
Bereavement leave

Termination of an employment contract in the Czech Republic can either by bilateral agreement, or unilaterally by the employee or employer, depending on the circumstances.

Grounds for legal termination of the employment contract can include:

Misconduct
Capability
Redundancy
Company closure
Breach of contract

Termination of employment requires written notice with a minimum notice period of 2 months, unless otherwise mutually agreed between the employer and employee.

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Frequently Asked Questions

The standard pay frequency is monthly. Employees enjoy a flat rate of income tax, which currently sits at 15% with Employer Taxes at approximately 32%. Included within the Employer Tax are contributions towards Pension, Sickness & Unemployment Funds and Health Insurance.

A working week in the Czech Republic consists of 40 hours. This is typically 8 hours per day but cannot exceed 12 hours. Overtime requires consent from both parties and must not surpass 8 hours per week and 150 hours per year.

Maternity Leave entitlement in the Czech Republic is 28 weeks, with a minimum of 14 weeks that must be taken. Maternity Leave can start as early as 8 weeks before the due date but must be taken at least 6 weeks prior. For those who have multiple births, an extended Maternity Leave of 37 weeks is available.

As with many regions, a process must be followed in order to dismiss an employee in a compliant manner. We recommend speaking with one of our local Employment Experts prior to engaging in a dismissal. Typically, an employee is entitled to a Severance Payment which varies based on the length of their service: in most cases, it is 1 month’s salary for 1 year of service, 2 months’ salary for 2 years of service and 3 months’ salary for 3 years or more.