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UPDATED NOV 5, 2026💡 Everything you need to know to hire and manage employees in the Czech Republic through Toku. Toku handles payroll processing, tax withholding, social contributions, and statutory compliance. This guide covers what you need to plan costs and manage your team.
At a Glance
| Item | Detail |
|---|---|
| Currency | Czech Koruna (CZK) |
| Payroll cycle | Monthly. Toku runs one payroll per month in the Czech Republic. |
| Estimated employer costs on top of salary | Approx. 34-35% |
| Onboarding lead time | 5-7 business days |
| Standard working week | 40 hours |
| Probation period | 3 months standard, up to 6 for managerial roles (set in the employment agreement) |
| Annual leave | At least 4 weeks, calculated in hours based on working time. A 40-hour week gives 160 hours for a full year. Many employers offer 5 weeks. |
| 13th month salary | Not required |
| Minimum notice on termination | 1-2 months depending on the grounds |
Onboarding a New Hire
Plan for 5-7 business days between submitting a new hire and their start date. Toku registers the employee with social security and their health insurer before the start date, and the employment contract must be signed before day one. Your new hire just needs to provide proof of their health insurance and sign promptly.
Submit the new hire through the Toku platform for the employment agreement, statutory registrations and payroll setup. See Onboard Contributors as a Client Admin in Toku for the steps. Toku will confirm the expected onboarding timing for your hire.
Employer Costs
On top of gross salary, employers in the Czech Republic pay:
| Cost | Rate | Notes |
|---|---|---|
| Pension insurance | 21.5% | On salary up to CZK 2,350,416 per year (2026) |
| Health insurance | 9.0% | No ceiling |
| Sickness insurance | 2.1% | Same annual ceiling as pension |
| Unemployment insurance | 1.2% | Same annual ceiling as pension |
| Accident insurance | 0.28-5.04% | Based on industry risk classification; low for office roles |
As a rule of thumb, total cost of employment is roughly 134-135% of gross salary for typical office-based roles. There is no mandatory 13th month salary.
Employees pay their own social and health insurance (11.6% in total) plus income tax of 15% (23% on income above roughly CZK 1.76 million per year). These are withheld from gross salary, not paid on top. Toku calculates and remits all of the above.
Compensation & Payroll
Toku runs one payroll per month in the Czech Republic, and employees receive a written payslip each cycle showing gross pay, deductions, and net pay. Salaries are paid in CZK by bank transfer.
The minimum wage for 2026 is CZK 22,400 per month (CZK 134.40 per hour). There is no statutory 13th month salary or mandatory bonus, though annual bonuses are common in the market.
Employment Contracts & Probation
- Toku issues a compliant local employment agreement for every hire, signed before the first day of work; bilingual contracts are standard for international teams.
- Indefinite-term contracts are the default. Fixed-term contracts may run up to three years and be renewed at most twice.
- Probation is set in the employment agreement: typically 3 months, or up to 6 months for managerial roles. The statutory maximum is 4 months for non-managerial employees and 8 months for managers. During probation, either party may end the employment without stating a reason.
Working Hours
The standard week is 40 hours, with a maximum shift length of 12 hours. Overtime may only be ordered in exceptional cases, is capped at 150 hours per year without the employee's consent (416 hours total with it), and averages no more than 8 extra hours per week.
Premiums on top of average earnings: 25% for overtime, 100% for public holiday work (or compensatory time off), 10% for weekend work, and 10% for night work. Employees get a 30-minute break after six hours, at least 11 hours of rest between shifts, and 35 hours of weekly rest.
Leave Entitlements
| Leave | Entitlement | Who pays |
|---|---|---|
| Annual leave | At least 4 weeks, calculated in hours based on working time. A 40-hour week gives 160 hours for a full year. Many employers offer 5 weeks. | Employer |
| Sick leave (days 1-14) | 60% of reduced average earnings | Employer |
| Sick leave (day 15 onward) | 60-72% of the daily assessment base, rising with duration | Social security |
| Maternity leave | 28 weeks (37 for multiple births) at 70% of the daily assessment base | Social security |
| Paternity leave | 2 weeks within 6 weeks of birth at 70% of the daily assessment base | Social security |
| Parental leave | Until the child turns 3; state benefit up to CZK 350,000 total (CZK 700,000 for multiples) | State |
| Care leave | Up to 9 days (16 for single parents) at 60% | Social security |
| Bereavement leave | Up to 3 days at full pay | Employer |
At least one leave block of two continuous weeks should be taken each year, and unused leave carries over but must be used by the end of the following year. Maternity, paternity, and parental benefits are paid by the state, not by you.
Public Holidays (2026)
The Czech Republic observes 13 public holidays. In 2026 only two fall on weekends (July 5 and December 26), and there are no substitute days off for weekend holidays.
| Date | Holiday |
|---|---|
| January 1 | Restoration of the Independent Czech State / New Year's Day |
| April 3 | Good Friday |
| April 6 | Easter Monday |
| May 1 | Labour Day |
| May 8 | Victory Day |
| July 5 | Saints Cyril and Methodius Day |
| July 6 | Jan Hus Day |
| September 28 | Czech Statehood Day |
| October 28 | Establishment of Czechoslovak Republic Day |
| November 17 | Day of the Fight for Freedom and Democracy |
| December 24 | Christmas Eve |
| December 25 | Christmas Day |
| December 26 | St. Stephen's Day |
Benefits
Czech employees are covered by the country's robust public healthcare system, funded through mandatory payroll contributions that Toku administers. Public health insurance, pension insurance, sickness insurance, unemployment insurance, and workplace accident insurance are all statutory and included in Employer Costs above. On top of this, Toku adds a premium private healthcare program through Canadian Medical, which complements public coverage with faster access and premium service.
Benefits at a Glance
| Item | Detail |
|---|---|
| Supplemental health provider | Canadian Medical (exclusive partnership) |
| Employee cost | Fully sponsored by Toku for employees |
| Dependents | Can be added at the employee's cost |
| Premium | CZK 4,900 per person |
| Clinics | Prague and Brno, plus virtual clinic and phone consultations |
| Enrollment | Via benefits@toku.com (name, start date, dependents) |
Supplemental Health Through Toku: Canadian Medical
Coverage highlights:
- Clinics in Prague and Brno with 38+ medical specializations, evening and Saturday availability, and a personal care coordinator in Czech and English.
- Guaranteed emergency appointment within 24 hours and appointments at partnered clinics within 5 days; guaranteed bed for the first 14 days of hospitalization at partnered facilities.
- Virtual clinic, phone consultations in and outside working hours, doctor chat, online medical records, and e-prescriptions; 6 home visits per year (GP or pediatrician) outside working hours; medication delivery in Prague and surroundings.
- Preventive care: annual check-up, vaccinations (Hepatitis A & B, tick-borne encephalitis, HPV, meningococcal, flu, and more), pre-travel consultations, and reminders for preventive exams.
- Dental & specialized care: dental emergencies, annual dental hygiene, 15% discount on dental procedures, complete preventive health check-up, eye prevention with OCT glaucoma exam, gynecology/urology/dermatology, cardiology, abdominal ultrasound, and premium pregnancy care at 50% of the standard pricelist.
Costs & Who Pays
The premium is CZK 4,900 per person. Employee coverage is fully sponsored by Toku (billed to you); dependent coverage is available at the employee's cost.
Enrollment
To enroll an employee, contact benefits@toku.com with the employee's name, start date, and whether dependents should be added.
What You Need to Know About Benefits
- Statutory social and health insurance are already reflected in Employer Costs above; Canadian Medical is an extra Toku provides on top.
- Enrollment isn't automatic: email benefits@toku.com with your new hire's details so they can be added.
- Canadian Medical's clinics are in Prague and Brno; employees elsewhere can still use the virtual clinic and phone consultations. For the full employee-facing detail, see the Czech Republic Employee Benefits Overview for details.
Common Extras
Common extras in the Czech market include meal vouchers or meal contributions (the most widespread benefit, tax-advantaged up to statutory limits), employer contributions to third-pillar pensions (tax-exempt for the employee up to CZK 50,000 per year), a fifth week of annual leave, and flexible working arrangements. Toku can advise on the cost impact of any of these.
Ending Employment
The Czech Republic does not recognize at-will employment: termination requires one of the grounds listed in the Labour Code, and employees cannot be given notice during protected periods such as sick leave, pregnancy, or parental leave. Involve Toku early so we can establish the right grounds and paperwork. For the process, see How to Terminate an Employee or Contractor.
| Grounds | Notice |
|---|---|
| During probation | None required |
| Organizational changes (redundancy, closure, relocation) | 2 months |
| Health reasons | 2 months |
| Breach of duties, poor performance, or loss of qualifications | 1 month |
Severance applies to terminations for organizational reasons: one month's average salary for under a year of service, two months for 1-2 years, and three months beyond that (12 months where the reason is occupational injury or disease). Statutory severance is exempt from social and health contributions. Employees can challenge a termination in court, so documentation matters; Toku will calculate the full exit cost for you before anything is signed.
Annual Leave at Termination
This section describes statutory annual leave. Any additional contractual or company-provided leave above the statutory minimum may follow different carryover, expiry, or payout rules under the employee's agreement or applicable policy, subject to local law.
Statutory leave termination payout: Required for outstanding statutory leave. Monetary compensation for unused statutory annual leave is generally due when employment terminates.
Statutory carryover / look-back: Unused leave can carry into the following year where it was not taken, including where the employer or a protected absence prevented use.
Admin responsibility: Actively schedule annual leave, keep current-year and prior-year balances separate, and document why any leave was carried over.
Important exceptions: Protected absences and employer-caused non-use can extend the life of the entitlement. Toku should review older balances before they are treated as expired.
See the Annual Leave / PTO Carryover & Termination Payout Guide for the cross-country framework.
Hiring Someone from Overseas?
EU, EEA, and Swiss nationals can work in the Czech Republic without a permit. Third-country nationals typically need an Employee Card (a combined work and residence permit) or an EU Blue Card for highly qualified roles, with processing times of roughly 60-120 days and a labor market test usually required; from 2026, applications must be filed through Czech embassies in the candidate's home country. Talk to Toku before extending an offer to a candidate who needs sponsorship.
Last updated November 5, 2026 (onboarding link and annual leave guidance only). Last verified October 2026. This guide is for general information and doesn't constitute legal or tax advice. Your Toku account manager can confirm specifics for your situation.