In autumn 2025, the Financial Administration issued a press release in which it drew attention to illegal forms of employment and at the same time informed about the strengthening of inspection activities in cooperation with the State Labour Inspection Office. According to the Financial Administration, the avoidance of labour law obligations is often hidden behind formal contracts for work or provision of services, fictitious “agencies” and complex chains of legal entities, and leads to tax and insurance contributions evasion. In February 2026, the Financial Administration will launch the initiative “Kobra” against illegal work, which will also focus on labour users based on the so-called risk model for the correct targeting of inspections.
In addition, the audit activities are currently supported by the judgment of the Supreme Administrative Court (“SAC”) in the case No. 22 Ads 168/2025, confirming selected conclusions of the Labour Inspectorate, that the activity of couriers for the company on the basis of a contract of carriage fulfilled the characteristics of dependent work in the case under consideration and the company enabled the performance of illegal work in the form of the so-called švarsystem system. In the given judgment, a fine of CZK 2.5 million was imposed.
The Labour Inspectorate imposed a fine on the company for the offence of enabling the performance of illegal work by eight couriers who worked for the company on the basis of business contracts instead of concluding an employment relationship. Couriers regularly and for a long time delivered purchases ordered by customers through the online shop in the company’s cars with its logo, which were rented by couriers, on routes designated by the company, while couriers acted towards customers on behalf of the company’s online store.
The company defended itself against the fine and argued that the matter was incorrectly grasped because it is a specific case of doing business on a digital platform and it is a so-called “dual activity” that can be performed both in an employment relationship and in a business relationship. The model of cooperation with couriers was business, flexible and based on voluntariness, while the company also warned of a negative impact on the digital services segment. According to the company, the signs of dependent work were incorrectly assessed. However, the company’s arguments were not found by the court to be justified.
According to the SAC, the formal basis on which a person carries out his or her activity is not decisive for the assessment, but the relationship must be assessed according to its true nature (the so-called substantive criterion). Even if the parties conclude a commercial contract, it will be necessary to assess their relationship as an employment relationship if the activity carried out on the basis of such a contract fulfils the characteristics of dependent work.
Dependent work is work that is performed in a relationship of superiority of the employer and subordination of the employee, on behalf of the employer, according to the instructions of the employer and the employee performs it for the employer personally. In order to conclude whether a particular case is a case of dependent work, it is necessary to comprehensively assess all the features of dependent work. The statutory conditions under which dependent work is to be performed (i.e. for wages, at the expense and responsibility of the employer and during working hours at the employer’s workplace or at another agreed place) are important guidelines for the assessment. According to the SAC, it will not be a relationship between two equal business partners if all the characteristics of dependent work are cumulatively met.
The SAC stated that the current legislation allows entrepreneurs to ensure their main activity both with the help of permanent employees and with the help of independent cooperating persons. However, this does not mean that in the case of outsourcing it would not be possible to assess the activity as dependent work, because the material aspect is always decisive. In the case under consideration, the SAC found that all the characteristics of dependent work that are connected by the employee’s personal and economic dependence on the employer were met.
Personal performance of work: The company argued that contracts with couriers allowed performance through a substitute or subcontractor after the prior consent of the company for quality control reasons. According to the SAC, however, it is not relevant how the contractual relationship was formally conceived. What matters is whether personal performance of work has been proven. The couriers testified that they worked personally, so this sign of dependent work was fulfilled.
Systematic performance of work: The company objected that the couriers were not obliged to carry out deliveries systematically and within the stipulated working hours, and at the same time they could refuse the order. In order to meet the sign of continuity, the SAC considered the testimony of couriers who stated that they performed their work regularly and systematically, which was also reflected in the invoicing for the work performed. The company motivated couriers to regularly deliver larger numbers of orders. Even the absence of setting working hours does not exclude dependent work according to the SAC.
Performance of work on behalf of the employer: According to the SAC, it is decisive who provides capital for the work, creates the prerequisites for it and bears the risk of failure, while an additional aspect may also be whether the person appears to be an employee from the point of view of third parties. The couriers had cars and other accessories from the company on lease, but according to the company, they could also use other means that met its requirements. In fact, however, this did not happen. According to the SAC, the couriers performed work on behalf of the company because they rented a car with a company designation, complaints were handled by the customer with the company’s customer support, and before delivery, couriers reported themselves by SMS with their first name and the name of the company’s online store. According to the SAC, the use of another car only with the consent of the company is not a typical arrangement for an equal business relationship.
Superiority/subordination relationship: According to the SAC, the decisive factor for this feature of dependent work is whether the employee perceives his or her position as subordinate and therefore respects the employer’s instructions. This happens through personal dependence, e.g. in the form of a reward. Although couriers could also work for others, in practice this was almost not the case and couriers had income only or mostly from the company. The economic dependence is not refuted by the fact that the amount of remuneration changed from month to month, and in some months it was even zero for some couriers. Couriers were dependent on the organization and assignment of work by a company that was interested not only in delivering the purchase, but also in meeting its standards. The negotiation of contractual penalties for breach of service obligations, which are prohibited in labour law, cannot exclude the conclusion that this characteristic of dependent work has been met.
We will continue to monitor the current case law and the plans of the Ministry of Finance in the fight against tax evasion and the grey economy. However, it is already advisable to evaluate your existing business cooperation from a material point of view, as the SAC has ruled, and to prepare for possible future inspections.
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