Unequal pay: Constitutional Court rejects Czech Post's complaint

You may remember the case of a Czech Post driver who objected to his pay not being the same as that of a colleague in Prague. The Constitutional Court has now sided with the Supreme Court's decision that external social and economic conditions, such as the labour market situation or cost of living in the region, shall not affect the level of employees' remuneration, and rejected the constitutional complaint lodged by the Czech Post.

Equal pay for equal work. The Labour Code obliges employers to ensure equal treatment of all employees in terms of their remuneration. According to the courts that decided the case, this principle was violated by the Czech Post when they paid different wages to employees in the same job position and at the same wage schedule level but in different cities.  An employee of the Czech Post who worked as a driver in Olomouc received lower remuneration for his work than a driver working in Prague. The Czech Post was arguing a higher difficulty of work in Prague compared to Olomouc, and significantly higher cost of living in Prague and its surroundings than in other regions. 

The Czech Post argued, among other things, that in terms of equal pay, ‘real’ wage rather than ‘nominal’ should be considered, i.e. taking into account the cost of living in the region. However, during extensive evidentiary proceedings, the lower courts found no grounds that would justify the differences in remuneration between the two job positions, such as a lower workload or poorer work performance of the drivers. Importantly, the Labour Code does not list external socioeconomic conditions as a criterion, therefore does not allow taking them into account when determining wages.

Although in the course of the proceedings, the Chamber of Commerce also appealed to the Constitutional Court, pointing out, among other things, that the Supreme Court's decision would create inequality between local entrepreneurs and entrepreneurs with a wider territorial scope who would be discriminated against, the Constitutional Court rejected the Czech Post's complaint.

In its decision, the Constitutional Court stated that they were well aware of the view of business entities on the matter and of the situation on the labour market and admitted that Czech legislation was rather strict in this respect. However, the Constitutional Court emphasised that it was not their role to create legal rules or interpret them differently from the wording of the law. If legislators intend to allow for the consideration of regional socioeconomic conditions, nothing prevents them from adopting such a regulation if political consensus is reached on the matter.

In the light of this decision, it is advisable that employers revise their remuneration systems. Should they find that they remunerate employees in the same job positions differently depending on their place of work, they must either provide reasons justifying the different wages in accordance with the principles enshrined in the Labour Code, or they should adjust their remuneration systems. Otherwise, they risk that they will be fined by labour inspectorates or that their employees will succeed in similar disputes as that of the mentioned Czech Post employee.

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