As already published in the media in the past, as per 1. 1. 2012 the recourses have been stiffen up towards companies and enterprisers who use the so-called Svarc system, that‘s concealment of employment by trade agreements.

The State Labour Inspection Office therefore notified of a higher frequency of controls focused on this illegal employment. Within the realization of this plan a few projects co-financed from EU Structural Funds were prepared with the task to reinforce the control activities of the Labour Inspection. According to the State Labour Inspection Office, in 2012 the number of employees was increased by 400 persons.

One of the next auxiliaries which should help to the State Labour Inspection Office as of beginning of the year, are the so-called mobile offices. Because the tendering on selecting the supplier was cancelled due to little interest was cancelled, the mobile offices weren’t thus at disposal from January 2012, but as late as during the year. The mobile offices are cars equipped with a notebook, printer, scanner, remote internet connection and GPS. 180 of such cars should be available for the checks.

The Labour inspections perform further extraordinary control actions. They are especially interesting due to focusing of controllers on specific enterprise activities. The priority aims of the control action were ski resorts in the whole territory of the Czech Republic (570 checks). Further in the territory of the capital city of Prague the checks were focused on fast food stands (93 checks) and in the Middle Bohemia region they proceeded to the checks of gas stations (40 checks). Based on the administrative proceedings 79 fines in the total amount of 14 634 000 CZK were proposed. These figures result from the published report of the State Labour Inspection Office as of 10. 5. 2012 – Extraordinary control action and results of the activity of the State Labour Inspection Office for the month April 2012.

The Labour Inspection authorities ensure not only the common operation related to the control activities namely not only based on the program of control actions, but it also performs checks based on suggestions from citizens who remind of a breach of employment regulations on the part of employers. For example for 1st half-year 2012 5 819 suggestions were recorded (thereof 3 711 in the area of employment relations and 1 718 in the area of checks based on the Employment Act). The most frequent department where the incentives are usually headed submitted by inhabitants, are especially the department for the employee’s remuneration, department of employment and agreements on work performed outside the employment and illegal work. It doesn’t derive directly from  the press reports from which circle they receive these incentives, however it is possible to assume that the widest circle will be from the current employees, former employees, competitors etc..

For the first half-year 2012 the evidence shows 25 069 checks in total from which the imposition of 1 763 fines in the total amount of 100 940 049 CZK resulted.

Synoptic table of imposed fines for the 1st half-year 2012:

Remark: the total sum of fines on individual sections doesn’t have to correspond to the total number of fines (a fine to one employer may affect both the breach of regulations – BOZP (occupational health and safety) and in the section of labour law or Employment Act.

As resulting from the published statistics, the highest average fine amount concerning one breach of law is evidently in the section of checks of the Employment Act (approx. 100 thousand), in case of other breaches it is approx. 40 thousand CZK. However it is not possible to generalize the above stated facts as the amount of fines is of course changed according to the found deficiencies of individual employers.

In relation to the performed checks there is an interesting conclusion on results of the check performed by the State Labour Inspection Office in the Office of the Chamber of Deputies and in the office of the Senate of the Parliament of Czech Republic regarding providing services of assistants.

A press release on conclusions of this check was issued on 10th May 2012. It concerned a check of facts whether it concerns a dependant work in case of these assistants (and herewith the appropriate provisions of the Labour Code are breached) as they work as self-employed persons based on the trade license.

Findings of the check:

• Agreements on the delivery of assistant’s services are concluded with the self-employed natural persons and with trade companies
• The identical conditions by a type are arranged – the subject of delivery of these services, and the identical supplies are provided

The inspectors concluded based on the stated facts that in case of these self-employed natural persons (assistants) it doesn’t concern dependant work and on the part of the Office of Chamber of Deputies and the Office of the Senate it doesn’t concern an illegal employment especially due to the fact that the relationship incurring between the assistant of a deputy or the senator does not fulfil the characters of a dependant work.

According to the report, based on this relationship, there are no rights or obligations towards the Office of the Chamber of Deputies resulting from the Labour Code which would incur namely to the assistant. None of these chambers namely assigns a job to the assistant, the assistant is not subordinated to appropriate executives and the work is not performed on behalf of the employer.

The conclusion results from the fact that when comparing the employees of the office of the Chamber of Deputies and the office of Senate who are working based on the concluded employment relationship with the similar subject of work activity and the exercise of the activities of assistants, there are fundamentals differences. The assistants do not have the stipulated scope of the working time, no working time register is administered and the place of providing these services is especially outside the registered office and workplace of both chambers of the Parliament of Czech Republic. Further the services are ensured according to the agreement which is concluded in compliance with the provision of § 117 Sec. 2 of the Act on the standing order of the Chamber of Deputies and according to this regulation, a deputy can’t pay for the stated services himself, but the administrator of the pertinent budget chapter (The Office of the Chamber of Deputies) is paying out this. For this reason the service rendering agreement is not concluded with a deputy or senator.

As stated in this Information, there are also some doubts about the term „assistant“, however it involves a widely used term for job positions and work activities performed based on the employment relation.

Should you have any questions to this issue, please do not hesitate to contact us.