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Further Guidance on Employment Contracts

Further Guidance on Employment Contracts

23.9.2013 11:42
Autor: Milan Šperl, KSB

Simply put, it depends on the type of work activities and their relationship to the work under the main employment contract.

In the relevant case, a delivery truck driver sued his employer for failing to pay his salary and overtime pay. In addition to concluding an employment contract, the employee and employer had entered into a services agreement under which the driver agreed to collect money from customers upon delivering goods. The employee claimed that the services agreement was invalid because the collection activities coincided (in terms of time) with the driver’s job under the employment contract. According to the employee, the employer’s intention was to conceal overtime work and, in essence, to circumvent the Labour Code’s provisions applicable to working hours, breaks and overtime. The employer argued that in the agreement the employee agreed to carry out work activities that did not fall under the work described in the employment contract and hence the law was not circumvented.

Although the employee won the case before the court of first instance and the appellate court, the employer filed a special appeal with the Czech Supreme Court, which had the last word in the dispute. The Supreme Court based its decision on the provision of the Labour Code that provides that work activities carried out under a secondary employment agreement (i.e. employment and work activities performed under an agreement for work activities not specified in the “principal” agreement) must differ in type from the work activities in the original agreement.

Different Work Yes, Supplementary Work No

In determining whether work activities carried out under a second employment agreement can be considered a different type of work, the nature of the work is crucial. The Labour Code states that the work activities must differ from and, at the same time, must not be of an auxiliary nature to the work carried out by the employee under the original employment agreement. Viewed from this perspective, the Supreme Court held that collecting money upon delivery does not constitute a different work activity since it can be considered an auxiliary task. The employment agreement governing such secondary work was thus held to be invalid.

If the message is not sufficiently clear, here is another example. If an employer enters into a second employment agreement with an employee – one who works as an accountant under an employment contract – under which the employee should also work as a payroll accountant, this too would constitute circumvention of the Labour Code and the agreement would be invalid. But if the accountant were to work under another agreement as an Executive Assistant, the agreement would be valid. 

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