EIRO 2005 Annual Review for the Czech Republic

The record reviews the main industrial relation developments in the Czech Republic during 2005.

Disclaimer: This information is made available as a service to the public but has not been edited or approved by the European Foundation for the Improvement of Living and Working Conditions. The content is the responsibility of the authors.

Introduction

The 2005 annual review aims to provide an overview of the main developments in industrial relations at EU level and in EU Member States plus Norway and the accession countries of Bulgaria and Romania.

National centre contributions for country chapters

Your contribution must answer all points listed in the questionnaire below - if a particular question is not relevant, there have been no developments concerning a particular topic, or no data is available, this should be stated. Where national centres do not follow the questionnaire structure, or fail to make any response at all to any question, the questionnaire will be returned to the national centre concerned for correct completion.

The format of the individual country chapters will remain largely the same as in previous years, so national centres should aim to submit a contribution which is similar in style and format to last year’s published chapter for their country on EIROnline. Please look at your edited contribution for 2004 (not the original material submitted) for an indication of the framework to follow. In addition to the usual questions, this year the special topics to be looked at are:

  • collective bargaining and social dialogue relating to labour migration from the new Member States to the old Member States; and
  • collective bargaining and social dialogue relating to corporate social responsibility.

National contributions should not be more than 2,500 words in length - brief summary information is therefore required (please make sure you adhere to this limit, otherwise your contribution will be cut in order to keep the size of the whole review within set limits).

Your contribution must include all relevant references to previous EIRO records for your country, in addition to any other references as appropriate.

Important: please use this EIRO template questionnaire to respond. Please remember to propose this as a January feature and submit it in the normal way.

Please submit your contribution by 13 January 2006.

If you have any queries on the content of the questionnaire, please contact:

Andrea Broughton, tel: 44 20 8212 1987, fax: : 44 20 8662 2041 e-mail: andrea.broughton@irseclipse.co.uk

If you have any administrative queries, please contact Shivaun Lindberg.

1. Political data

Please give brief details of:

  • Any general or significant regional/local elections which were held in 2005
  • The only elections in 2005 were local elections: new elections to certain municipal councils (in May and September) and supplemental elections to the council in one municipality (in February and May).
  • Any significant political events which took place in 2005

There was wide media coverage of a scandal surrounding Prime Minister Gross (Czech Social Democratic Party, CSSD, Ceská strana sociálne demokratická, CSSD), his inability adequately to explain how he financed the purchase of his flat and his wife’s suspect business ties, which unleashed an overt conflict in the government coalition. During the first four months of 2005 the cabinet went through a crisis that ultimately led to a change of prime minister - Stanislav Gross opted to resign the position and was replaced by Jirí Paroubek (CSSD). The government crisis was accompanied by a profound decline in the popularity of the strongest party, CSSD, as recorded in opinion polls (though it recouped some of its losses in the autumn, so the result of the parliamentary elections in 2006, and in particular the contest between CSSD and Civic Democratic Party, ODS, Obcanská demokratická strana, ODS, remains open).

In foreign policy, President Václav Klaus, who remained the most popular politician in the country throughout 2005, continued to argue against further Europe-ification and with Europe’s constitutional principles; his views were met with criticism from some EU representatives.

  • forthcoming national or important regional/local elections or significant political events

2006 is a significant election year for the Czech Republic. The key internal political event - the June elections to the Chamber of Deputies of Parliament (Poslanecká snemovna Parlamentu Ceské republiky)- may fundamentally alter the balance of power and change alliances in Czech politics. Autumn 2006 will bring elections to the Senate of Parliament (Senát Parlamentu Ceské republiky) and local elections.

If there have been no political events of note over the past 12 months, please give details of the government currently in power

2. Collective bargaining update

Please give details of the number of collective agreements negotiated in 2005 by level (eg national, sectoral, company), compared with numbers of agreements negotiated in 2004. Outline any trends/shifts between levels of bargaining.

Czech law distinguishes enterprise-level collective agreements (ELCAs), concluded between the relevant trade union body and an employer; and higher-level collective agreements (HLCAs), concluded for a greater number of employers by the relevant higher-level trade union body and an organisation or organisations of employers.

As far as ELCAs are concerned, there is no central register of ELCAs in the Czech Republic. According to data from the biggest trade union umbrella organisation, Czech-Moravian Confederation of Trade Unions, CMKOS (Ceskomoravská konfederace odborových svazu, CMKOS) (which represent a majority sample), a total of 3,422 ELCAs, covering 1,051,404 employees, were concluded for 2005 by trade union organisations associated in CMKOS’s members that took part in the survey. In 2004, 1,167,886 employees were covered by 3,872 ELCAs (CZ0501103F). Compared to the data originally stated as at 31.8., we can now give final data as at 31.12.2004. ELCAs concluded for 2005 by trade union organisations in CMKOS covered approx. 28% of all employees in the Czech Republic (the Czech Statistical Office, CSÚ, Ceský statistický úrad, CSÚ puts the total number of employees in the civilian sector of the national economy in the 2nd quarter of 2005 at 3,754,800). In 2004 the total coverage of employees by ELCAs concluded by organisations in CMKOS was approximately 28.5%.

The applicable legislation provides for a duty to present the Ministry of Labour and Social Affairs of the Czech Republic, MPSV CR (Ministerstvo práce a sociálních vecí CR, MPSV CR) with a copy of a concluded HCLA for storage. As at 31.12.2005 MPSV CR had received and registered a total of 32 HLCAs effective in 2005.

According to CMKOS data, out of a total of 33 trade unions associated in CMKOS 11 concluded a total of 18 HLCAs that covered approximately 4,850 employers and almost 557,000 employees. In the 2nd quarter of 2005 there were 3,754,800 employees working in the civilian sector of the national economy, making the coverage rate approx. 15%. In 2004 the CMKOS figures were 22 HLCAs covering 4,729 employers and 589,651 employees (i.e. approx. 15% of all employees in the civilian sector of the national economy).

With effect from November 2005 HLCAs were extended in the construction industry to a further 3,130 employers with approx. 250,000 employees. Including this extension, 806,800 employees were covered by HLCAs concluded by CMKOS member unions, which makes approx. 22% of all employees in the civilian sector in the Czech Republic.

Please give details of significant collective bargaining developments concerning the following specific themes:

  • Pay (including both general trends and the level of collectively-agreed pay increases)

As far as wage developments in the period from 2004 to 2005 are concerned (enterprise sphere), the year-on-year growth in average wages is estimated (CMKOS) at 6.5%. According to Czech Statistical Office data, in the first half of 2005 average wages in the enterprise sphere rose by 5.2% year-on-year, and real wages by 3.5%. In the non-enterprise sphere, an approx. 8.3% year-on-year increase in average wages can be expected (CMKOS). In the first half of 2005 average wages in the non-enterprise sphere are 7.1% higher year-on-year, and real wages 5.4% higher (CSÚ). The minimum wage in the Czech Republic rose by 7.2% from 2004 - from 1.1.2005 it was CZK 7,185/month, or CZK 42.50/hour.

Wage growth was negotiated in all 18 HLCAs concluded (within CMKOS) for 2005 for enterprise-sphere employees. The commitments guaranteed either a specifically fixed average nominal wage increase or the preservation of real wages, or in some cases average wage growth in the form of an increase in wage tariffs, extra wages and/or other wage components. Most HLCAs provided for a wage increase derived from expected price growth (inflation), or was moreover conditional on improved work productivity. The average year-on-year increase in average nominal wages negotiated in HLCAs was approx. 4%. Wage tariffs are negotiated every year in approx. 85% of HLCAs as the minimum levels that cannot be overstepped, and their value is also increased each year. Defining the level of wage tariffs in individual sectors is one of the most complicated problems in collective bargaining in the Czech Republic. The average minimum wage negotiated in HLCAs (within CMKOS) was CZK 7,000 in 2004 and CZK 7,484 in 2005. 13 HLCAs for 2005 contained an agreement on a bottom wage tariff at the level of the minimum wage.

Evaluation of developments in the content of ELCAs in the Czech Republic is based on the outputs of a regular annual sample survey of the Information System on Working Conditions. As far as negotiated wage tariffs are concerned, the average value of tariff wage in the bottom tariff was CZK 6,848, which is approx. CZK 337 less than the value of the monthly minimum wage (CZK 7,185/month). The average value of the minimum wage fixed in ELCAs for 2005 was CZK 7,701/month, more than 7% above the government-decreed minimum wage. All available forms of wage were used for remuneration purposes in ELCAs: most frequently a time-based wage (used in 33.6% of cases in 2005). More than 77% of ELCAs contained provisions on wage development for 2005, either as increases in wage tariffs or in the preservation of real wages, increasing the total volume of wage funds or increasing average real wages. The negotiated year-on-year growth in annual nominal wages in ELCAs for 2005 was approx. 3.9%. Wage growth dependent on the employer’s business results was negotiated in 13.7% of ELCAs.

  • Working time (including working time reductions and flexibility agreements)

HLCAs contain provisions for shortening working time without a reduction in wages, extending holiday entitlement and increasing paid leave beyond the minimum framework provided for by law in the event of personal obstacles on the part of the employee. A commitment for a shortened working week of 37.5 hours was contained in 59% of HLCAs concluded; extension of holiday by an extra week was negotiated in approx. 80% of HLCAs. The provision of extra paid leave than that laid down by law was usually tied to the occasion of the birth of a child, the death of a family member, accompanying a child to a healthcare facility etc.

  • working hours (at least in one of the working regimes) was negotiated in more than 93% ELCAs (94.2% in 2004). The average working week was 38 hours, as in 2004. Nor was there any change year-on-year in the proportion of ELCAs containing an extension of the legal holiday allowance (usually by an extra week), which remained almost 77%. The average extent of paid leave on various occasions also remained approximately the same in 2004 and 2005.
  • Job security

The situation did not change much from 2004 - the key provisions were those improving the job security of certain categories of employees, e.g. those over 50 years of age, people about to qualify for old-age pension or with a greater number of years worked at the employer. More allowance is made for social family aspects in the event of mass redundancies.

  • Equal opportunities and diversity issues, including efforts to close pay inequalities

Although an anti-discrimination campaign targeting the legal aspects of discrimination took place in the Czech Republic, financed partly out of EU funds, and there was legislative progress both in 2004 (new anti-discrimination rules for labour law) and in 2005 (adoption of uniform legislation on protection from discrimination), in our opinion - there is no systematic monitoring - this issue mainly features in collective agreements in the form of general provisions and proclamations. One social dialogue actor that tackles questions of equal treatment (CZ0505102F, CZ0504101N) in social dialogue is CMKOS: its head office has a Committee for Equal Opportunities of Women and Men, which has formulated a Plan to Support Application of the Principle of Male and Female Equality in the Conditions of CMKOS and Individual Trade Unions. CMKOS monitors the gender breakdown of teams taking part in collective bargaining at sectoral level. Compared to 2004, when 28 of the 128 people in 27 bargaining teams were women, in 2005 22 of the 105 members of 21 teams taking part in collective bargaining were women.

  • Training and skills development
  • issue is not regularly monitored either. In our opinion there have been no major developments: general provisions still predominate: provisions define the employer’s attitude to the professional training of its employees, details for releasing employees to take part in training courses, etc.
  • Any other issues which have featured significantly in your country during 2005
  • 2005 there was no fundamental worsening or narrowing of the substance of collective agreements compared to 2004. The length of time for which HLCAs are negotiated is gradually increasing and year-long validity has been replaced by two-year or three-year agreements. The average length of bargaining was 12 weeks.

Please make sure you fill out all of these sections. If there is no relevant information, please state this.

(In this section, where no statistics [from official or other sources] are available on the number of collective agreements, or of agreements on specific themes, please give your view of how collective bargaining has developed in 2005, referring to the main events of the year from your own monitoring for EIRO purposes.)

3. Legislative developments

Are there any legislative developments which have taken place in your country in 2005 which are not mentioned in any of the other sections? If so, please give details, including a short contextual summary.

In September 2005, the Czech government (Vláda Ceské republiky) put before the Chamber of Deputies of Parliament a new draft labour code covering all aspects of labour relations (CZ0511101F). The draft’s principal goal is to create the right conditions in law for the liberalisation of labour relations and for broader application of the contractual principle; it also has fundamental importance for the further development of individual and collective labour law in the Czech Republic.

Act No. 202/2005 Coll., effective since 27.5.2005, lays down that non-fulfilment of ordinary tasks stemming from the subject of its business by the employees it employs for this purpose in labour relations is an administrative offence for a legal person and a misdemeanour for a natural person. The new legislation sets out penalties for these cases.

In June 2005 the Chamber of Deputies passed a draft act on work inspection (overriding the president’s veto): Act No. 251/2005 Coll. entered into force on 1.7.2005 (CZ0507101N). Now, work inspectorates exercise the key powers in addition to the labour offices.

In June 2005 the Chamber of Deputies passed, with effect from 1.7.2005, the government draft of Act No. 255/2005 Coll., amending Section 7 of Act No. 1/1991 Coll., on collective bargaining. Section 7 had been rescinded by the Constitutional Court of the Czech Republic (Ústavní soud Ceské republiky) for its repugnance to the Charter of Fundamental Rights and Freedoms (CZ0410103F). The Chamber of Deputies thus overrode the Senate’s rejection and president’s veto of the bill. The essence of the new legislation is that a proposal for an extension must be submitted by both parties to an HLCA, whereby at least one of them must represent the biggest number of employees in the sector for which the extension is being proposed. After verifying that the proposal satisfies the requirements of the law, MPSV CR issues a statement that the agreement is also binding for other employers whose main business is in the sector and which employ over 20 employees. Extension does not apply to employers on whom bankruptcy has been declared, employers with more than 50% of employees with altered capacity for work, employers at which an extraordinary event has occurred (whose consequences persist) or employers covered by another HLCA.

In December 2005 the Chamber of Deputies passed the government draft of an act on equal treatment and legal means of protection from discrimination (what is called the anti-discrimination act). The adoption of anti-discrimination legislation is one of the Czech Republic’s commitments related to accession to the EU. The bill regulates the right to equal treatment and protection from discrimination in access to employment and an occupation, self-employment, in working conditions and promotion, including pay, membership of professional organisations, membership of organisations of employees and employers, access to education, healthcare, social security and social benefits, and access to goods and services, including housing. It provides the same standard of protection for all victims of discrimination, regardless of the grounds of discrimination on which and legal relationship in which it occurred.

In November 2005 the Czech government approved a government bill on employees’ accident insurance (proposed effect from 1.7.2006). The aim is to motivate both employers and employees to create the best possible conditions for safe work. Instead of the current insurance of the employer’s liability for damages in the event of a work accident or occupational illness, a new form of insurance with its own system of benefit provision, and the liability for damages caused to health by a work accident or occupational illness moves from labour law to the social security system (the responsibility for performing accident insurance of employees passes to the Czech Social Security Administration, CSSZ (Ceská správa sociálního zabezpecení, CSSZ).

In December 2005 the Chamber of Deputies passed a government bill on sickness insurance (effective from 1.7.2007). The current system, with an excessively high level of income solidarity, does not possess sufficient safeguards against abuse. Despite the improving health of the Czech population, incapacity for work is still unjustifiably high. The new legislation (CZ0507101N) is expected to reduce the abuse of benefits and to motivate doctors and employers to reduce incapacity for work.

The Czech government decided to increase the minimum wage for 2006: by 5.4% as at 1.1.2006 and 5.1% as at 1.7.2006. The provision is designed to boost the motivating function of the minimum wage. In connection with the increased minimum wage, the government also approved an equal increase in the minimum wage tariffs as at the same dates.

In December 2005 the Chamber of Deputies approved the government bills on the subsistence minimum, the act on aid in material need (effective from 1.1.2007). The goal is to motivate people actively to look for work and accept less well paid work.

With effect from 1.1.2006 there have been changes in the legislation on re-training, with the amendment of the act on employment no. 382/2005 Coll., (re-training is only intended for job-seekers, job candidates, employees and other people who arrange the re-training themselves; it may only be performed by accredited facilities and educational or healthcare facilities that have accredited training programmes).

In October 2005 the Chamber of Deputies passed the government draft amendment (with effect from 1.10.2005) of Act No. 118/2000 Coll., on protection of employees in the event of insolvency, which chiefly implements the relevant European directives. In December 2005 the Senate returned the draft to the Chamber of Deputies with proposals for alterations.

4. The organisation and role of the social partners

Have there been any changes in the organisation and role of the social partners in your country (eg trade union or employers’ organisation mergers or decisions about participation in bargaining) during 2005? If so, please give details.

In cooperation with MPSV CR the social partners represented in the tripartite forum: the Confederation of Industry of the Czech Republic, SP CR (Svaz prumyslu a dopravy CR, SP CR), the Confederation of Employers’ and Entrepreneurs’ Associations, KZPS (Konfederace zamestnavatelských a podnikatelských svazu, KZPS), CMKOS, the Association of Independent Trade Unions, ASO (Asociace samostatných odboru, ASO) were fundamentally involved in preparing new legislation regarding the extension of HLCAs (see above). HLCA extensions are regarded as a key means of developing the capacity of social dialogue at sectoral level and in the enterprise sphere, partly thanks to the results extensions have achieved to date.

By contrast, the standpoints of the social partners represented in the Council of Economic and Social Agreement, RHSD (Rada hospodárské a sociální dohody, RHSD) in preparing and appraising the draft new labour code did not converge - the draft is surrounded by much contention.

Developments in the capacity of social dialogue (CZ0412102F) are documented by the following data. From the long-term point of view (but also in 2004/2005 year-on-year comparison) most quantitative indicators mapping the process of collective bargaining in the enterprise sphere (within CMKOS and the Czech Republic as a whole) had a downward tendency. Since 1994, for example, the number of employers at which there operated a trade union organisation from the member unions of CMKOS fell, according to CMKOS figures, by approx. 48%; the number of employees of employers where these trade union organisations operate fell by approx. 45%; and the number of union-member employees at these employers fell in the same period by 75%. The number of ELCAs concluded by CMKOS was 40% lower in 2005 than 1994 and the number of employees covered by an ELCA fell by 48% from 1994 to 2005. According to trade union information, the number of trade union organisations that have too few employee members to conduct collective bargaining is rising. The available information also testifies to the fact, however, that some trade unions managed to stop the decline in their membership in the period under scrutiny and, in cooperation with the relevant employers’ organisations, have managed to implement measures to increase the capacity of collective bargaining and social dialogue.

At the end of the year an Agreement on Bipartite Cooperation between, on the one hand, SP CR, KZPS, the Czech Confederation of Commerce and Tourism, SOCR (Svaz obchodu a cestovního ruchu, SOCR), and, on the other hand, CMKOS and ASO, on joint measures to strengthen bipartite dialogue at national level in the spirit of the development of European social dialogue. Consultations will cover the implementation at national level of EC guidelines and agreements between the social partners at European level, or possibly in collective agreements, support from state authorities for attracting foreign investors, the preparation, course and results of collective bargaining at enterprise and higher level etc.

5. Industrial action

Please give brief details of major strikes and industrial action in your country during 2005 (including any statistics available, if only for part of the year). Please highlight any particularly significant developments which have taken place over the past year.

There is no legally defined reporting duty in this area. These activities by the social partners have not been centrally monitored since the mid 1990s.

According to trade union data (for CMKOS only), a dispute was resolved through a mediator during the negotiation of an HLCA in one case in 2005 (as in 2004) and during the negotiation of an ELCA in 7 cases (11 in 2004). A dispute was resolved before an arbiter during the negotiation of an ELCA in 2 cases (as in 2004). A strike alert during the negotiation of an HLCA was announced in one case (as in 2004), and also once during the negotiation of an ELCA (15 cases in 2004). One strike alert was called outside collective bargaining in 2005 (CZ0501101N) (5 cases in 2004). No strike took place during the negotiation of an ELCA in either 2005 or 2004; during the negotiation of an ELCA in one case (CZ0505101N) (there was none in 2005). There were no strikes outside collective bargaining in 2005.

2005 also brought protests and demonstrations: in January there was a trade union demonstration in front of the Ministry of Agriculture, MZe CR (Ministerstvo zemedelství CR, MZe CR) by employees of wood processing firms in protest against the situation in the sector; in October there was a one-day strike and demonstration by doctors and pharmacists in protest at the government’s healthcare policy; in November there was a trade union demonstration in support of the government draft labour code and the preservation of trade union rights, jointly organised by CMKOS and ASO.

Here one can also mention the walk-out by representatives of the social partners from a session of the plenum of the RHSD in September 2005 in protest at the government’s alleged failure to fulfil its tasks (adopted in the tripartite forum). After the session was suspended, the employers and trade union issued a joint statement stressing their interest in responsible social dialogue within the RHSD.

The aforementioned bilateral agreement on social dialogue between the largest organisations of the social partners also contains provisions on the preparation of joint proposals for the Czech government regarding the resolution of key issues of social dialogue impacting on the national and European level in order to find mutually acceptable solutions and to help reduce social tension, including eliminating any actions design to exert pressure. The agreement includes the mutual provision of information about the social partners’ problems at enterprise level and an identification of effective tools for resolving and preventing collective agreements and thus also eliminating social conflicts in enterprises. Without doubt, the signing of the agreement contributed to the fact member unions of CMKOS largely described relations between the social partners of sectoral social dialogue as correct in 2005, according to CMKOS.

6. Employee participation

Have there been any legislative or other significant developments in the area of employee information and consultation (and other forms of participation) in your country in 2005? Have there been any developments related to the implementation of the European Company Statute (EU0206202F) or the Directive on national information and consultation rights (EU0204207F), or any debate on these issues (eg any indication on the extent to which companies headquartered in your country intend to use the European Company Statute to incorporate as a European Company)? Have there been any significant developments connected with European Works Councils over the past year?

In December 2005 the Senate debated the government draft of the labour code, designed primarily to transpose Council Directive 2002/14/EC. The existing legislation did not provide for implementation of, most notably, Article 6 of the directive (question of confidential information and the non-disclosure duty for experts invited by representatives of employees). The Senate decided to return the bill to the Chamber of Deputies with proposed alterations.

The new labour code being debated in Parliament contains comprehensive provisions on the issue of employee participation.

On 11.1.2004 Act No. 627/2004 Coll., on the European company, entered into force. The act provides that the newly formed company will be joint stock and defines, among other things, the minimum capital necessary for its incorporation.

Provision of information was also enshrined in HLCAs and ELCAs, usually as part of provisions on cooperation between the parties. For example, provision of economic information was negotiated in approx. 70% of HLCAs concluded and approx. 73% of ELCAs concluded (similar to 2004), according to CMKOS data.

As far as the EWC situation is concerned, most trade unions concentrate (a number of them systematically) on gaining information and experience from trade union activity abroad, actively take part in the work of EWCs and are striving to broaden their representation.

7. Labour migration

Please give a summary of the debate on labour migration, including any discussion of the proposed EU services Directive (the Bolkestein Directive). If you are reporting from an old Member State (the EU15 including Norway), please give details of whether your government has put into place restrictions on labour migration from new Member States (as permitted by the EU) and whether it intends to lift these restrictions in 2006. Please include any statistics if available and/or brief details of any particularly interesting cases.

If you are reporting from a new Member State (the 10 that joined on 1 May 2004) or a candidate country, please summarise the debate on labour migration from your country to the old Member States, including any relevant statistics and/or a summary of any interesting cases. If any issue has been reported already in EIRO, readers can be pointed to the relevant EIRO inbrief or feature for a more detailed overview.

The Czech government is striving to have the existing restrictions to the free movement of labour abolished and has called on EU representatives not to hinder the opening of the labour market (at present Czech citizens may only work in Great Britain, Sweden and Ireland without difficulty; in Great Britain there were approx. 9,000 Czechs registered for work in 2005).

Even after the Czech Republic joined the EU there was no large-scale labour migration by Czechs to foreign countries. The results of sociological research show that the keenest interest in working abroad is found among highly skilled professions, scientists and research workers (CZ0512102F).

8. Corporate social responsibility

Please give details of any developments in collective bargaining or social dialogue in the area of corporate social responsibility. This may take the form of company-level agreements, international agreements in multi-national companies that are headquartered in your country, or agreements at national or sectoral level. If no examples of agreements exist, please give an overview of the debate in your country.

The question of corporate social responsibility (CSR) has gradually been coming to the forefront in the Czech Republic. According to research organised by the civic association The Czech Donors Forum, CDF (Fórum dárcu) and supported by Phare, corporate philanthropy is already an established concept in the Czech Republic. Most Czech firms (86%) apply it, but differences persist in the tools that firms use, the area into which they channel their support and what importance they place on corporate philanthropy in the firm’s overall activities. The research found a fundamental difference in approaches chiefly between large, often foreign companies and small, usually Czech, regional firms. Most large firms (over 85%) apply the principle of CSR and make donorship part of their overall strategic plan in this field: most contributions head into the social, healthcare and educational spheres. By contrast, small firms have more recently started to exercise philanthropy (58% of surveyed entities have been involved for approx. 5 years). The most frequent beneficiaries of corporate funds are children and youth (53% of companies make regular contributions to young people in the Czech Republic); less frequent beneficiaries are various social groups (the homeless, drug addicts or ethnic or national minorities). The CDF (the association is an umbrella group for donors and promotes philanthropy in the Czech Republic) identified 5 basic requirements for corporate donorship (the existence of a long-term donorship strategy; transparency, i.e. publishing the circumstances under which a firm provides support; differentiation between sponsorship and donorship; the use of various corporate philanthropy instruments such as material gifts, employee volunteering etc.; and the use of tax benefits). It is mainly large firms that display all these features, in particular members of the Donator, the Club of Corporate Donors (Donator, Klub firemních dárcu) attached to the Czech Donors Forum, which signed the Corporate Donation Code of Ethics.

The role of corporate donorship in the Czech Republic is growing: in the last 3 years the number of firms involved has risen by 12%. The concept of philanthropy is also changing - firms think of their support more as a direct investment in the society they operate in rather than charity. 60% of surveyed firms are considering corporate donorship or broadening their philanthropic activities on the condition of an increase in tax deductions for donations (at present firms in the Czech Republic may deduct from tax 5% of their tax base for donations); almost one third of firms feels a lack of greater social recognition and demands a change in the attitude of the media to corporate philanthropy.

This area is not exclusive to enterprise: for example, the Solidarity Foundation established by the ECHO trade union, OS ECHO (Odborový svaz ECHO, OS ECHO) (a member of CMKOS) concentrates on supporting human rights, protecting cultural monuments and traditions, developing and promoting science, education, sport, exercise and providing humanitarian, social and other aid, chiefly to employees and former employees of chemicals companies that sign up to the foundation’s programme. It provides chiefly foundation contributions (based on written requests), loans, credit and other material aid.

9. New forms of work

This is a topic that encompasses part-time work, fixed-term contracts, temporary work through agencies, teleworking, on-call working or any other atypical types of working. Have there been any legislative or other significant developments - such as collective agreements or social partner policy statements - during the past year concerning these types of atypical work?

Further, if there have been any significant trends concerning the growth of a particular form of atypical work in your country, please include brief statistical details and a summary of the debate and/or direction of possible action on that issue.

In our opinion (there is no comprehensive monitoring), there have been no major changes in the scale of atypical forms of work in the Czech Republic since the previous period (CZ0501103F).

A pilot project (supported by EU funds) called Occasional Registered Work, organised by MPSV CR in cooperation with Sodexho Pass, labour offices and Research Institute for Labour and Social Affairs, RILSA (Výzkumný ústav práce a sociálních vecí, VÚPSV), is taking place in the Znojmo, Vyškov and Hodonín regions. The project is designed to enable job seekers registered at the labour offers to do a limited amount of work and thus gain an extra earning of up to half the minimum wage, without losing their unemployment benefit entitlement. The system mainly focuses on unskilled work and offers employers a new, flexible form of employment.

Part of the Equal programme is a project called Support for Work from Home Using Information Technologies, which is designed to verify the realistic possibilities of supporting teleworking in the Plzen region (involving the establishment of teleworking and training centres for at-risk groups on the labour market, the holding of seminars for employers, identification of the demand for teleworking and mapping the potential for its application). In recent years bipartite social dialogue has started to touch on the development of non-standard forms of work. An above mentioned Agreement on Bipartite Cooperation formed the basis for discussions between the social partners on the transposition of the Framework Agreement on Telework into the draft new labour code. The outcome of these discussions and cooperation between the social partners was Section 312 of the new labour code, which deals with the use of certain new forms of work organisation, including teleworking. According to CSÚ data, approx. 90,000 did teleworking in the Czech Republic.

In 2005 a state-supported project of pilot programmes for employment of certain groups of the population (e.g. young people or poorly skilled workers) was prepared. It envisages that the selected workers could work in the social services, for example. Three-quarters of the people making use of this form of employment are women, one-quarter men. The project will take place in the Ústí nad Labem, Moravian-Silesian and Karlovy Vary regions, which have above-average unemployment.

10. Other relevant developments

Have there been any other significant industrial relations developments over the past year which have not been mentioned above? If so, please give details.

The rate of registered unemployment has been falling year-on-year - at 31.12.2005 it was 8.9% (December 2004 - 9.5%). The labour offices had a total of 510,416 job seekers on their books (31,259 fewer than in the same period in 2004). The average rate of unemployment has also fallen year-on-year (2004: 9.2%; 2005: 9%). The employment situation for school-leavers and young people has developed positively, mainly owing to employers’ demand for young employees with good IT and language skills (the number of school-leavers looking for work fell year-on-year by 8,715). By international comparison (Eurostat) the Czech Republic’s rate of unemployment has for a long time remained below the EU average. The reason for this favourable development is the growing economy, but also the broadly applied active employment policy.

The Czech government approved a plan to introduce the single European currency - the Czech Republic should become part of the eurozone in January 2010.

In 2005, a record amount of foreign investments entered the Czech economy (worth a total of CZK 238 billion from January to October). Besides the advantageous system of investment support, investors are attracted by the relatively cheap and high-quality labour, the affordability of real estate, the easy access to lucrative west European markets and the growing prosperity of the country .

11. Outlook

In order to enable us to include a conclusion and forward-looking section at the end of each national contribution, please give an overview of the issues which are likely to dominate the coming year in your country.

Analytical estimates predict that in 2006 the Czech Republic’s economy will continue to grow at approximately the same rate as in 2005 (GDP growth of 4.5% to 5%) and the standard of living of the majority of the population will grow (wages are to rise faster than prices; and the reduction in natural persons’ income tax should have a positive impact on increased household consumption). This progress will also reflect the growing influx of foreign investments (by the end of January 2006 South Korean enterprise Hyundai should make a decision on where to locate its new high-capacity production plant in the Czech Republic) and growing foreign demand for products from the Czech Republic, chiefly stimulating exports of technologically advanced products to other EU countries. The Czech currency will evidently strengthen further.

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