Compensation bonus for persons working under agreements to complete job / perform work outside employment relationship

The government has approved the provision of compensation bonuses also to persons performing work outside employment relationship, i.e. those who have been working based on an agreement to complete a job or an agreement to perform work resulting in their participation in the sickness insurance scheme. In the case of an agreement to complete a job, this involved gross monthly income exceeding CZK 10,000; in the case of an agreement to perform work, gross monthly income of CZK 3,000 and more.

On 29 June, the government approved an amendment to the Act on Compensation Bonus. It will be possible to apply for a bonus of CZK 350 for each calendar day even retrospectively, for the period from 12 March to 8 June 2020. 

Claiming the compensation bonus is conditional on whether, based on a given agreement, the given person contributed to the sickness insurance scheme for at least four calendar months in the period from 1 October 2019 to 31 March 2020 . Moreover, apart from the work performed based on such an agreement, such a person must not have performed any other activity as a result of which it participated in sickness insurance as an employee (excepting foster parents or social service volunteers).

Another condition is that the work could not be, fully or partially, performed as usual for reasons on the employer’s part resulting from health risks or emergency measures (in particular, closure or restriction of operations, or limited demand for products, services or other outputs, etc.) or on the given person’s part (i.e. quarantine or care for a child or another family member).

Under the amendment, compensation bonuses (of CZK 500 a day) will also be available to the self-employed and members of small limited liability companies who previously were not entitled to the bonus due to the concurrence of their activity with agreements to complete a job or agreements to perform work giving rise to the participation in sickness insurance. 

Compensation bonuses will again be managed and paid out by the tax authorities. Applications should be submitted to the tax authority with local jurisdiction via a data box, email or personally. Along with the application, it will be necessary to submit a copy of the appropriate agreement and copies of payroll sheets or any other relevant certificates issued by the employer. The deadline for filing the application for a compensation bonus expires three months of the amendment’s effective date. 

The amendment is expected to be discussed by the deputies during their extraordinary session on 10 July, in a fast-track legislative procedure. 

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