Minimum wage

What it means

The minimum wage is the lowest lawful pay for work under an employment relationship. It is set both monthly and hourly and changes every year, either by agreement between the social partners or through the statutory automatic mechanism.

It is complemented by minimum wage entitlements across six levels of job difficulty. An employee at a higher level is entitled to more than the base rate, even where the role is nothing exceptional.

Not everything an employee receives counts when comparing pay with the minimum wage. Pay for overtime and the statutory supplements for night work, work on public holidays or in difficult conditions are left out. An employee who reaches the minimum only thanks to supplements is in fact paid below the legal floor.

How it works in practice

The minimum wage affects more than the lowest salaries. Certain premiums, assessment bases and thresholds derive from it, so each annual change recalculates contributions and the total cost of employment too.

Part-time work is reduced pro rata, and work agreements use the hourly rate. We track the change on the client’s behalf and amend the affected employment contracts before the first pay run of the new year.

The minimum wage applies to employees, not to a director who works for the company only under a directorship agreement, nor to a sole trader. In small s. r. o. companies we therefore first establish on what legal basis the director works for the company, and only then look at the amount and the contributions that will follow from it.

What to watch out for

Topping pay up to the minimum is not optional, and back-payments found by the labour inspectorate are calculated with contributions. Watch the difficulty level too: classifying a job at level one when it plainly belongs higher is a routine finding.

With a fixed monthly pay and an irregular workload, the hourly rate can quietly fall below the minimum. It is enough for a part-time employee or someone on an agreement to work more hours than planned. During an inspection, the hours worked are compared with the attendance records, and without them the employer will struggle to prove otherwise.