- Income support for workers
Ochrana zaměstnanců před platební neschopností zaměstnavatele
Wage guarantee in case of insolvency
Coverage/Eligibility
All private law employment relationships are eligible, including part-time workers, fixed-term workers and domestic servants. Public officials are excluded.
Other employees are also excluded from protection, namely employees who are members of the employer’s statutory body and shareholders with half and higher participation, and employees who work for the employer as temporary agency workers (TAW) and whose wages are covered by a TAW insurance in case of insolvency.
Main characteristics
The employee has to submit the application for claims to the labour office according act no. 118/2000 Coll., Protection of employees in the event of insolvency of their employer. The employee has to apply within 5 months and 15 calendar days following the date on which the labour office published its official board information to the court regarding the employer who has filed an insolvency petition or has impounded property. All claims (wage, payment for holidays, termination of a job, payment for time off to visit a doctor) that arose in the period of three months before and three months after the month when the insolvency was announced are covered. Wage claims are covered for a maximum period of three months, for a monthly amount of one and a half average wage in Czechia as prescribed by law. The guarantee is financed by the state and paid by the labour office; there are no employers’ contributions.
Funding
- National funds
Involved actors
National government
Legal framework, funding Public employment services
Administration Kiti
Local court responsible for insolvency proceedings
Effectiveness
The number of employers, number of submitted employees' applications and paid wage guarantee followed the economic cycle in the country, as it can be observed in the table below.
|
2007 |
2008 |
2009 |
2010 |
2011 |
2012 |
2013 |
2014 |
2015 |
2016 |
2017 |
2018 |
2019 |
Number of employers whose employees are qualified for the wage guarantee in insolvency |
382 |
386 |
750 |
847 |
840 |
961 |
802 |
693 |
437 |
345 |
316 |
- |
- |
Submitted employees' applications |
5,983 |
3,973 |
16,281 |
9,998 |
7,100 |
9,101 |
8,031 |
6,094 |
4,569 |
3,826 |
2,177 |
- |
- |
Processed applications |
6,888 |
5,055 |
19,451 |
11,028 |
8,253 |
7,694 |
8,202 |
6,830 |
5,610 |
4,402 |
3,290 |
3,793 |
4,431 |
Wage guarantee paid to employees in total (thousands CZK) |
196,033 |
150,330 |
844,033 |
497,837 |
389,142 |
451,799 |
333,208 |
391,856 |
229,500 |
250,339 |
167,343 |
257,154 |
277,672 |
Wage guarantee paid to emplyoees in total (thousands EUR) |
7,128 |
5,467 |
30,692 |
18,103 |
14,151 |
16,429 |
12,117 |
14,513 |
8,500 |
9,628 |
6,436 |
9,891 |
10,680 |
Source: Labour office of Czechia (Úřad práce ČR )
Strengths
This measure can guarantee the living standard of employees in case of employer's insolvency.
Weaknesses
The payments are limited to 1.5 times of the average wage or salary in Czechia.
Pavyzdžiai
Šaltinis
- Act No. 118/2000 Coll., Protection of employees in the event of insolvency of their employer
- Act No. 182/2006 Coll., Insolvency act
- European Commission (2011), Report on the implementation and application of certain provisions of Directive 2008/94/EC on the protection of employees in the event of employer insolvency.
- ERM database on restructuring related legislation
- Sargant, M. (2007), Implementation report Directive 2002/74/EC on the protection of employees in the event of employer insolvency, European Commission
- Analysis of development of employment and unemployment, MPSV
- Labour office of Czechia (Úřad práce ČR)
Eurofound welcomes feedback and updates on this regulation
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