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Coronadvice 15 – A dismissal, and how to avoid paying an extra month.
Let's face it, tourism is in crisis and, although nobody wants it and despite support from the state, there will certainly be some layoffs. Some entrepreneurs with zero income simply cannot afford to pay their employees. If an employer wants to lay off employees, it is better to do so today. Tomorrow, it may cost the employer one more month in salary.
The employer may either agree on termination of the employment contract with the employee, or may terminate the contract unilaterally on grounds of the legal reasoning. The reason for dismissal due to the lack of orders or closure of the business caused by coronavirus pandemic is covered under §52 (a) and (c) of the Labour Code - redundancy of an employee.
Why is it important that the notice of termination of employment will be delivered to the employee today on 31st March instead of tomorrow on 1st April? With the notice of termination being delivered on the last day of the month, which is today, the notice period starts on the first day of the following calendar month (which is tomorrow, 1st April). The minimum period of notice is two months, so the employment will terminate at the end of May. Whereas being delivered tomorrow, on the 1st April, the notice period will start running from the beginning of the following month (May) and, with a two-month notice period, will end on 31st June. The employer will thus have to pay one extra month of salary. However, employers should be aware of their obligation to inform the Labour Office in case they plan a mass layoff. If the employer fails to inform the Labour Office, the employment will not terminate till 30 days after informing the Labour Office.
In order to end the notice period on 31st May, the notice must be hand delivered to the employees today. It has to be delivered, it is not sufficient to just dispatch it. The employer can serve the notice in person at the workplace, at the employee's apartment, or wherever the employee can be reached. In case the employee refuses to accept the notice, it is advisable to have at least one witness who can confirm the refusal to accept the notice.
However, the employer's financial obligations do not end with the notice. The employer should not forget that employees who have been made redundant are still entitled to redundancy payments in the minimum amount of:
- one time the average monthly earnings, if they have worked for the employer for less than one year;
- twice the average monthly earnings, if they have worked for the employer for one to two years, and
- three times the average monthly earnings, if they have worked for the employer for at least two years.
Termination of contracts for work and work performance agreements is a lot easier, and also cheaper. From these types of contract, the employer is not obliged to assign and schedule work performance in advance. If the employee does not work, respectively the work is not assigned to him, he is not entitled to remuneration. Compared to the employment contract, it can be terminated for any reason or without reason. The notice period is much shorter, being only 15 days. Further, there is no need to watch out for the end of the month since the notice period begins to run immediately on the day after the delivery of the notice. These contracts can be also terminated by an agreement.
We are preparing a special April Coronadvice for tomorrow. Stay tuned!
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Jasper Brinkman
Jasper Brinkman
"Following a devastating hotel fire in Prague, the law firm Holubová advokáti, led by attorney Klara Dvorakova, successfully represented our extended family as a group of victims. The firm navigated complex international insurance and compensation laws to defend our rights.
I would like to acknowledge the extraordinary efforts the firm had to make to bring our case to a successful compensation under extremely difficult circumstances."
Stewarts
Stewarts
"A visit to her daughter in London turned Eva's life upside down when she says she stepped into a crossing on a green light but was hit by a car. Despite her remarkable bravery, she faced a long treatment due to fractures in her pelvis, and the associated limitations and pain are likely to persist for the rest of her life. Regular headaches and impaired concentration compound her challenges.
Eva contacted us through an organization temporarily helping her manage her difficult living situation. At that time, she was destitute, relying only on subsistence payments. We were able to assist her because we specialize in personal injury and have contacts with proven colleagues abroad.
We worked with Stewarts, a UK law firm, on this case. Attorneys Klára Dvořáková and Rebecca Huxford helped Eva with the documentation in her case, explaining her options and the differences between the Czech and British systems of healthcare and social benefits reimbursement. Within a few months, thanks to the professional cooperation between the two offices, an offer of compensation from the insurance company of approximately CZK seven million was achieved. The client accepted this settlement because she did not want to deal with courts in the United Kingdom.
Subsequently, we assisted the client with related tax issues and contacted Auditone, a tax consultancy firm, which arranged for the filing of a tax return. Compensation for lost income is taxable, unlike most personal injury compensation.
'No one has done as much for me as you,' Eva said.
The fact that we were able to help Eva gives our work meaning and brings us great joy. We are very happy that, thanks to our many years of active involvement in the international professional organization PEOPIL, we can cooperate on such cases."