Agreements on work performed outside an employment relationship are an important instrument of labour law that allows flexible and quick solutions to short-term work tasks. Both the Agreement to Complete a Job (in Czech “dohoda o provedení práce”, shortly DPP) and the Agreement to Perform Work (in Czech “dohoda o pracovní činnosti”, shortly DPČ) provide employees and employers with the possibility to respond efficiently to the current needs of the labour market, although they have been affected by many recent changes.
Changes in general
Due to the growing popularity of agreements on work performed outside an employment relationship and the current development of the labour market, the legislator seeks to amend the regulation of agreements to ensure that labourer’s rights to agreements are safeguarded and that agreements are not abused. You can also read about these changes in our article here: https://www.peytonlegal.cz/en/amendment-to-the-labour-code-changes-to-agreements-on-work-performed-outside-the-employment-relationship/.
Last year, for example, an amendment to the Labour Code implemented by Act No. 281/2023 Coll. and a change to the so-called consolidation package in the area of sickness insurance and social security contributions and DPP pursuant to Act No. 163/2024 Coll. came into effect on 1 July 2024.
However, the tense atmosphere around the legislative regulation of the agreements still persists. The latest changes brought by the amendment to the Sickness Insurance Act again modify the conditions concerning social and health insurance premiums for agreements. The amendment, which was approved at the end of 2024, focuses on gradually increasing the income limit at which the obligation to pay insurance will also apply to employees working on the basis of the agreements on work performed outside an employment relationship (shortly employees working on agreements).
At the same time, a reporting duty was introduced for the establishment, changes and termination of relationships from agreements to the Czech Social Security Administration (CSSA), as well as a regular reporting duty regarding income from agreements without a limit (always by the 20th day of the following month).
The main changes that 2025 brings are:
- increase in the insurance premiums limits for both DPP and DPČ,
- entitlement to sick pay for employees working on agreements,
- paternity pay entitlement for employees working on agreements,
- the possibility to negotiate remuneration taking into account certain statutory fees (as from August 2024),
- failure to introduce the so-called notified-agreement regime,
- the possibility of self-scheduling work.
Below, we’ll take a closer look at some of the aforementioned innovations.
Higher limits for insurance premium payments
The legislator has newly increased the limit for the payment of insurance premiums for DPP for 2025 – instead of the current CZK 10,000, employees working on agreements must participate in sickness insurance from monthly earnings of CZK 11,500 with one employer.
Please note that for the purposes of sickness and pension insurance, income from the same employer is still aggregated, but income from multiple employers is not aggregated. As before, premiums are already paid on the decisive amount of CZK 11,500, which corresponds to 25% of the average wage for 2025 after rounding.
From 1 January 2025, the applicable monthly income for small-scale employment, i.e. most often for employees working on the basis of DPČ, has also increased. According to the announcement of the Ministry of Labour and Social Affairs, employees working on agreements have to pay insurance premiums when they earn CZK 4,500 or more, instead of the previous CZK 4,000.
More about this change in our article here: https://www.peytonlegal.cz/en/amendment-to-the-employment-act-labour-inspection-controls-employment-of-persons-with-disabilities-and-other-news/.
Entitlement to nursing and paternity allowances
If employee working on agreement, whether on the DPP or DPČ, is covered by sickness insurance due to the limits mentioned above, he is now entitled to nursing and paternity pay. These benefits are subject to the condition that this employee must have been insured for at least three months before the social event giving rise to the entitlement to nursing or paternity allowance and the need for nursing or paternity allowance arose on 1 January 2025 at the earliest.
Like other employees, employees working on agreements must meet the other conditions set by law for entitlement to these benefits. For nursing benefits, this includes the need to care for a child under 10 years of age or another natural person who requires care by another person. The two-week paternity allowance is payable only to the father of the child in connection with the care of the newborn child or to the insured person who has taken the child into substitute care.
In the area of sickness insurance, this puts employees working on agreements significantly on a par with employees working under the main employment contract.
Amount of remuneration with regard to premium payments
As from 1 August 2024, it is possible to negotiate remuneration for agreements taking into account possible night, weekend or difficult working conditions.
This option will remain in 2025, which means that employers do not have to calculate premium payments separately under the Labour Code if this option is expressly agreed in writing, thus avoiding the administrative burden of having to make a qualified estimate of the premium payments in question and continue to keep records.
The announced DPP regime will not be established
What was not ultimately introduced was the so-called notified agreement regime, which was intended to prevent deal-chaining and circumvention of the limits. The financial incentive here was the possibility to use the higher limit for participation and payment of insurance premiums in the case of the DPP.
However, the second wave of changes to the DPP has been abolished and therefore only the obligation to register and report monthly all employees working on DPP to the CSSA is still in force effective from 1 July 2024. Employers must report the entry, termination and changes of all employees working on agreements and submit monthly reports on their income, always by the 20th day of the following month.
Employee self-scheduling of working hours
An interesting novelty, which affects both employees working on the basis of the main employment relationship and employees working on agreements, is the employee’s self-scheduling of working hours.
According to Section 87a of the Labour Code effective from 1 January 2025, the employee and the employer may negotiate an agreement on self-scheduling, whereby the employee schedules his or her own working hours. However, they must comply with rules such as the length of the agreed working time (typically 8 hours per day) and mandatory limits for rest and breaks. At the same time, working hours must not exceed 12 hours per day.
It is an important condition that the agreement on self-scheduling of work is in writing, as well as any termination of the agreement. As regards the notice period, the basic length is 15 days, but the parties may agree on a different length, but it must be the same for both the employee and the employer.
The advantage of this regulation is that it applies to all employees, so it does not apply only to employees working remotely, but also to regular employees who commute to the workplace.
For more on self-scheduling, see our article here: https://www.peytonlegal.cz/en/scheduling-of-working-hours-by-the-employee/.
Conclusion
The new regulation in the area of agreements on work performed outside the employment relationship brings further partial changes that respond to the current situation, but in practice the number of agreements is unlikely to significantly change.
Employees working on agreements can enjoy a higher level of protection and a certain level playing field with employees in the main employment relationship. Higher contribution limits are certainly welcome.
The question is what path will be followed by further changes concerning DPP and DPČ, both in terms of their legal regulation and the approach of state institutions.
If you have any questions about this topic or employment law in general, please do not hesitate to contact us at PEYTON legal.
Mgr. Jakub Málek, Managing Partner – malek@plegal.cz
Rozálie Polášková, Legal Assistant – polaskova@plegal.cz
30. 1. 2025