Positive

On Tuesday afternoon I started to feel like I was coming down with something.  On Wednesday, I had the flu.  Typical cold symptoms - fever, chills, runny nose, body aches.  On Friday morning, I just knew it was more than the flu so I went back to St. Anne's for another PCR test.

On Friday evening I received an SMS (text message) that my results came back positive.  The official results were sent to me via e-mail with instructions that I needed to contact my GP.

I spent the weekend on quarantine, taking cold medicine, drinking lots of fluids and trying to sleep as much as possible.  On Monday, I had a video call with my GP and I was put on sick leave.  I have a follow up appointment on Thursday but hopefully I'll be able to go back to work on Monday.  

I thought the flu symptoms were part of the Covid thing but this is the worst flu that I've had in 10-11 years.  At least I haven't lost my sense of smell.  Yesterday I walked to the nearest pharmacy which is only about 250 metres from my flat.  There and back and it felt like I had walked for an hour.

My friend David offered to bring me some "badger's fat."  I had to laugh.  Apparently badger's fat is a thing in Slovakia.  From his description, it sounded like the Slovak equivalent of Vicks VapoRub.  I declined his offer to drop it off to me as he has two small kids at home and they've just recovered from it so I don't want to pass this on to anyone else.  I honestly don't know if it is really made out of actual badger fat or if that's just what they call it.

While I was at the pharmacy I wanted VapoRub so I asked for something that I could spread on my chest to help with the congestion.  

The pharmacist gave me psí sádlo, which is "dog fat".  I guess it's badger fat in Slovakia and dog fat here in Czechland.

One thing that's nice is I didn't have to deal with whole 5 different copies  of the paper based sick note system.  As of 1 January 2020, an amendment went into effect to the Sickness Insurance Act which launched electronic sick notes.  eNeschopenka is e-sick leave.

When you're too sick to work, the Czech Labour Code says that the employees pays the salary compensation for the first 14 days and from the 15th day it is paid by the District Social Security Administration (OSSZ).  If you are self-employed then the OSSZ pays benefits from the 15th day that you are unable to work.

The old 5 copy thing was a mess where some copies were for the doctor, some for the patient, plus the employer and the Czech Social Security Administration (CSSZ).  Now it is all online which means it is faster to receive payment of sickness benefits.  Everything is done via a CSSZ ePortal.

Increased Paternity Leave

Back in 2016 the Czech government gave new a week's paternity leave to new fathers.  The leave was to be taken within the first six weeks of birth at 70% of the father's base salary.

In 2019, the EU required that paternity leave be at least two weeks beginning no later than 1 August 2022.

In July the Chamber of Deputies approved the extension to two weeks and it was confirmed this week by the Senate.  Now President Zeman just needs to sign it and it will become effective 1 January 2022.  

It's a done deal that it will be signed since the EU will require it anyway.  Czechland will just be compliant seven months early.

One cool thing is that if the newborn child is hospitalised during the first six weeks since birth then the father can delay taking paternity leave until the child is released to go home.  Basically if the child has to be in an incubator then the father doesn't have contact with the child and the point of paternity leave is for the father to help care for the baby.

2021 Labour Code Changes

There are several changes to the Czech labour code which took effect on 1 January.

 An employee's vacation time is now determined by the number of hours worked during a week and not but the number of days worked.  This makes it fairer for employees who work part-time or work irregular shifts.  The law provides for a minimum of 4 weeks (160) hours of vacation time per year for a full-time employee.  While 4 weeks of vacation time is the minimum required under the labour code, many companies actually provide 5 weeks off in order to be competitive.

There's a new shared workplace law that allows an employer to hire two or more part-time employees to fulfil one full-time job.  The employer determines the schedule of working hours and the shared workplace has to be agreed upon will all the employees by a special written agreement.

The amount of worker's compensation benefits have been increased.  The circle of relatives eligible for survivor's benefits have also been extended.  There's now a new one-off compensation in place for non-pecuniary damage in the event of serious health damage to an employee.

Freelancers are now allowed to pay a flat tax instead of monthly contributions.  The 2021 flat tax is 5.469 Kč ($255) per month.  This includes the minimum health insurance contribution of 2.393 Kč and the  2.976 Kč minimum contribution for social security insurance.

The annual taxpayer allowance increases to 27.840 Kč ($1,297).  In 2022 it will increase to 30.840 Kč ($1,437).

The government has done away with the super-gross salary.  Previously, a person's tax base included the social and health insurance contributions made by one's employer.  

The solidarity tax has been eliminated.  This was an extra 7% on all income over 100.000 Kč ($4,660) per month.

Instead there's now a progressive income tax for people of 15% and 23%.  The 23% rate is for people whose income exceeds 48 times the average yearly salary.  For this year that's for people earning 1.701.168 Kč ($79,279).

Increased Parental Benefits

Last year the government passed an amendment to the parental leave law and as of January parental benefits have increased.  The biggest change is that the total amount of money parents are eligible for has been increased.

For a single child under four years of age the amount increases from 220.000 Kč to 300.000 Kč ($9852 to $13,435).

For multiple children (twins, triplets, etc.) under the age of four then the amount increases from 330.000 Kč to 450.000 Kč ($14,778 to $20,152).

This new larger total amount is still paid out over two, three, or four years.

The government has increased the maximum amount of time that children younger than two years of age can be in kindergarten/preschool while the family receives parental benefits from the state.  

The logic was that if the state is paying for a parent to be at home with the kid then the parent should be at home with the kid.  So there was a limit was 46 hours per month.  The new limit is 92 hours per month.

Czech Citizenship Exam: Employment

Here are the 10 study questions for the Czech Citizenship exam from section 15: Employment. 

1.  Ms. Novotná has the following information on her payslip:

How many crowns will she get into her account?

15 850 Kč

2.  When is the employee entitled to paid leave?  And when not?

When the employee has a wedding, when he or she goes to the doctor with their sick child, or when going to a funeral of a close family member.  Paid leave is not given when an employee is moving.

3.  According to the law, what must be in the employment contract?

Place of work.

4.  According to the law, the minimum wage is the lowest possible wage of an employee.  What is the current minimum monthly wage in the Czech Republic?

14 600 Kč.

5.  Mr. Novák has a full-time job.  How many hours a week does he have to work by law?

40 hours.

6.  Which law or code regulates the relationship between employer and employee?

Zákoník práce - Labour Code.

7.  Mr. Novák entered into a fixed-term employment relationship with Stavby, s.r.o.  How long can this new employment last without extension?

3 years.  

8.  Mrs. Nováková has a new job.  She will work as a saleswoman.  She obtained an employment contract for an indefinite period with a maximum probationary period.  According to the law, what will be the length of Mrs. Nováková's probationary period?

3 months.

9.  According to the law, what is the length of the weekly working time in the Czech Republic?

40 hours.

10.  Pan Novák is employed as a car mechanic and works 40 hours a week.  How long is Mr. Novák entitled to holiday leave in the calendar year?

4 weeks per year.

Czech Citizenship Exam: Social Security

Here are the 10 study questions for the Czech Citizenship exam from section 14: Social Security. 

1.  Which authority provides unemployment benefits?

Úřad práce - Labour Office.

2.  Mr. Novotný is 62 years old and will soon retire.  What is the name of the office where he can apply for a retirement pension?

Česká správa sociálního zabezpečení - Czech Social Security Administration.  

3.  Mr. Novotný lives alone and has an insufficient income.  At which office will Mr. Novotný apply for a living allowance and a housing supplement?

Úřad práce - Labour Office.

4.  Mr. Novák works in a construction company and is currently ill.  He does not receive a salary, but a cash benefit.  What is this dose called?

Nemocenská - Sick leave.

5.  Mrs. Svobodová is employed by a bank.  She is ill and receives a disability from the doctor (proof of temporary incapacity for work).  To whom will she hand over the sick note?

Zaměstnavateli - employers.

6.  Material deprivation is a situation where a person cannot secure basic living conditions for various reasons.  Which social benefits are among the assistance in material need?  What is not?

A child allowance is not a benefit for material deprivation.  Benefits include a housing supplement, a subsistence allowance, and emergency immediate assistance.

7.  Mr Novák is 56 years old and is unemployed.  What is the longest period for which he can receive unemployment benefits?

11 months.

8.  Mrs. Nováková works as a primary school teacher and is expecting her first child.  She is 3 weeks before giving birth.  What cash benefit can she receive before the birth of the child?

Mateřskou - Maternity.

9.  Mr. and Mrs. Svoboda work in an office and Mrs. Svoboda is expecting a child.  Who can get parental leave?

The mother and/or the father.  

10.  Mrs. Nováková was registered for unemployment at the labour office.  She started working yesterday. What method of notification will terminate her inclusion on the unemployment register?

She informs the labour office about the new job.

Extended Paternity Leave

Another good EU rule is coming.  No later than 1 August 2022, Czechland needs to extend paternity leave from seven to ten working days.

In 2016, the Czech government introduced seven days of paternity leave allowing fathers to claim up to 70% of their salary.  The seven days became effective February 2018.

The government also passed an amendment to the parental leave law that by 2020 will increase benefits from 220.000 to 300.000 Kč (~$9224 - $12,579; ~€8252 - €11.253).

Update:  In 2021, Czechland extended paternity leave to two weeks effective 1.1.2022.

Paid Sick Leave

In February the government passed Act No. 32/2019 of the Czech Labour Code.  Effective 1 July 2019 employees will be entitled to paid sick leave the first three days that they are ill.

Currently when you're sick, the first three days are unpaid.  After that, employees receive 60% of their salary paid by employers for 14 days.

In the past employees were paid the first three days.  In 2009 the three unpaid days were introduced to cut costs and prevent sickness benefits from being abused.  Since then the rate of employee sickness dropped significantly.

Many people feel that the three unpaid days financially penalises people for being sick.  Let's see what happens to sickness rates come July.

Something that I didn't know was that only 50% of sick pay is given if the reason for being sick is due to a brawl, due to intoxication, ingestion of psychotropic substances, or from committing a criminal offence.  This isn't new.  Just something that I didn't know about.

Update:  In July 2019, the first three days are now paid.

Sick Notes - Part Two

A parent will be issued a sick note when they need to stay at home to take care of a sick child.  When taking care of a family member up to 60% of a person's salary is covered by the state from the 1st to the 9th calendar day.  So no complete loss of salary for the first three days.

The payment from the state is for when you take care of someone at home.  If the family member is hospitalised then the payment is interrupted.

Taking care of a family member used to pertain to only one person but the law was recently changed so that parents can replace each other.

Single parents in Czechland are covered up to the 16th calendar day.

In Germany, parents get 10 days to look after sick kids.  While single parents get up to 20 days.

Sick Notes

It's never fun getting sick.  Here's what one can expect if it happens here in Czechland.

Let's assume that you have Czech health insurance and you go to the doctor.  If you are too sick to work then the doctor will issue a sick note so that you can stay home.  This note must be delivered to your employer within 3 working days.

The sick note is actually a several page form and each page has a different coloured stripe.

Part II is the Rozhodnutí o yzniku docasné pracovní - the yellow stripe.  This is the illness card and you have to keep it for the duration of your illness.  At the end of your illness you give this back to the doctor.

Part III is Hlášení zamestnavateli o vzniku docasné pracovní neschopnosti - the blue stripe.  This is the page that you have to give to your employer within 3 working days from the beginning of your illness.

Part IV is Rozhodnutí o vzniku docasné pracovní neschopnosti pro uplatnení nároku na nemocenské - the pink stripe.  This page is only used if the illness is longer than 14 days.  The backside of the form is signed by the patient and it needs to contain your bank account number.

Part V is Rozhodnutí o ukoncení docasné pracovní neschopnosti - also a pink stripe.  This is the form that you have to deliver to your employer at the end of your illness.  The patient has to sign the backside.

There's also a part of the pink form that you have to submit when your illness continues from one month to the next month.

As per Czech law, you don't get paid for the first three days that you are sick.  From day 4 to day 14, the employer pays 60% of the salary.  The state does not contribute any money.

From day 15, the employer no longer pays anything.  Instead the Czech government pays the 60% salary.  This is why part IV of the form is so important because if you don't deliver the forms on time then the state may not be able to deposit the partial salary to your bank account on time.

If you are home sick then you are expected to be at home.  On part II of the form, the doctor will provide some time that you can be out in public.  For example, so you can go to the market for groceries.  Perhaps from 9 am to Noon, and again from 2 pm to 5 pm.

The employer is entitled to check if the employee on sick leave is actually home sick when they are supposed to be.  The employer can contact the municipal social security administration and both parties will come knock on your door.  If you're supposed to be home sick and you're away then you can be fined.  I'm not sure what the amount of the fine is.  I suppose it depends on how long a person has been on sick leave for.

One of the very cool things about IBM here in Czechland is that the company supplements the 60% salary payment required by law.  For high level positions, IBM actually pays 90% salary for days 4 - 60.  Then for all employees, they pay 75% salary for days 61 - 120.

Update:  Here's a bit more I've learned about sick notes.
* The sick note literally states your inability to work.  So from the moment it is issued, you are not allowed to work, either in the office or at home.  If you start to work before the sick leave is finished then you are not entitled to be paid for the hours worked.
*The doctor can start the sick leave for up to two days prior.
*The doctor can provide for up to a maximum of six hours per day of free time.  This can be either six hours in a row or broken up in to two blocks of free time.  You can only leave the house during the free hours or if you have a doctor's appointment.
*If you will be somewhere else, say your parents' house for the weekend, then you have to let your doctor know in advance, so that he or she can update the address for your sick note.  Social security employees can check if the patient is at home (according to the address on the sick note).

Update:  In July 2019, the first three days are now paid.

Update:  In 2020, not sure if before or after Covid, but now the doctor's sick note is sent electronically to your employer.  So no need to keep up with which form goes where.

IBM Extending Benefits

When it comes to being committed to diversity then there are few companies that can match IBM.  There's a long track record in the company of acceptance and inclusion.  IBM had an equal pay policy for men and women back in the 1930s.  There was an equal opportunity policy at IBM 11 years before the Civil Rights Act became law.  It was one of the first companies to include sexual orientation as part of the Equation Opportunity policy and IBM extended domestic partner benefits in the USA almost 20 years ago.  It makes me proud to be an IBMer.

Now IBM is one of the first companies in Czech Republic to recognise registered partnerships in the area of paid time off.  So for example, under Czech labour law, an employee is entitled to paid time off if a spouse's parent dies.  This sort of benefit doesn't exist for same-sex couples because Czechland doesn't have gay marriage.  So even though there is no gay marriage here, IBM will still provide this type of benefit to those employees who have a registered domestic partnership.  There's still more to do but I'm proud of the progress that is being made in Central Europe.

Paternity Leave

Czechland has just approved a week of paternity leave to allow fathers to spend time with newborn children.  Dad won't have to take vacation days or unpaid leave.  The one-week leave is to be taken within the first six weeks of birth.  If the father has health insurance then he will receive 70% of his base salary.

This 70% of salary is based on a monthly income of 15.000 - 25.000 Kč ($588 - $980; €555 - €925).  Those with higher monthly salaries could be better off taking vacation days off instead.

Fathers already do have the option to take over maternity leave from the mothers after seven weeks.  This allows the father to take advantage of the 156-week parental leave but at a lower flat rate.

About 100,000 babies are born in Czechland each year.

The Denmark, France, Spain, Sweden and the UK all grant about two weeks of official paternity leave.  Finland allows 11 weeks and Norway gives 14 weeks in order to strengthen the ties between the parents and newborns.

Update 2019:  The EU requires that paternity leave will need to be extended to ten days.

Update:  In 2021, Czechland extended paternity leave to two weeks effective 1.1.2022.

Work Permit #3

I finally received my new work permit.  The Czech Labor Office had a backlog so it took much longer than normal.  I applied at the end of January and I should have received it around the end of February but instead I received it today.

Due to the delay in getting my work permit, I was informed that the Interior Ministry has put my visa renewal on hold.  Now that everything is legit they will continue processing my next residency permit.

This new work permit is good for another two years.  Hopefully this will be the last one I ever need.  In 2014, I will have been here five years and will be eligible to apply for permanent residency.  It doesn't mean that I will live here forever.  The big benefit is that as a permanent resident I will no longer be required to apply for work permits or residency visas.  Hurray!!  I will qualify for a decrease in the amount of bureaucracy I have to endure.  Of course, that's a year away and I'm sure that to apply for permanent residency I will still have to jump through hoops like a trained circus poodle.

Maternity & Parental Leave

With Claudia and Norbert expecting Tünde soon, I thought it would be interesting to chronicle some of the things involved with having a baby in Czechland.  I'll just start with comparing parental leave in the ČR and the USA.

In ČR, a woman is legally entitled to 28 weeks of maternity leave.  For twins, she gets 37 weeks.  The maternity leave can start up to eight weeks before the baby's due date.  However, a woman must start her maternity leave no later than six weeks prior to the due date.  Pregnancy is considered an illness so maternity leave is covered under sickness insurance benefits, normally at around 70% of one's salary.  There's no super complicated process for this either.  A physician fills out a statutory form that gets turned in to HR and the company submits it to the state.

Then the parental leave kicks in.  Mothers can take 2, 3, or 4 years of paid maternity leave.  If another child comes along while mom is out on maternity leave then the time gets extended.  Some companies offer bonuses to mothers that come back after six months or one year.  By the way, either mom or dad can take the parental leave so it's usually the one with the lower income.  Both may actually take parental leave at the same time but only one will receive state support. 

The money received by the state is proportionate to the duration of the time away.  The two-year plan pays about 11,400 Kč ($575) per month.  The three-year plan pays 7.600 Kč ($384) per month.  The four-year plan pays 7,600 Kč per month for the first nine months and then pays 3,800 Kč ($192) per month.  For children with disabilities, a parent is entitled to seven years of leave at 7,600 Kč per month.

Once the duration of parental leave has been chosen it cannot be changed.  It is very difficult to find day care for children under three years of age.  Since the government is paying money for a parent to stay at home, children under 3 cannot go to preschool more than five days per month.  While children over 3, cannot go to preschool more than four hours per day.  These rules are probably why most mothers, or fathers, end up staying at home for three years following the birth of a child.  Not a bad deal at all.

There are only four countries in the world that have no national law requiring paid maternity leave.  They are Liberia, Papua New Guinea, Swaziland and the USA.  Ouch!

In the USA, there is the Family and Medical Leave Act of 1993 (FMLA).  As long as the company employs 50 or more people within 75 miles, and as long as the employee has worked a minimum of 1,250 hours over the previous 12 months, then the employee is entitled to up to 12 weeks of unpaid leave.  It's no wonder that in the USA, it's not uncommon for women to work right up to their due date.

The FMLA is the national law.  Each state is allowed to mandate additional benefits.  For example, California requires paid family leave.  It really is embarrassing that the USA is the only industrialized country in the world that doesn't mandate paid leave for childbirth. 

Update: In 2016, the Czech government provided for one-week of paid paternity leave to fathers.
Update 2019:  Extended benefits.

Update 2020:  Parental benefits increased.

Work Permit Time...Again

On Tuesday, I had a meeting to sort out the renewal of my Czech work permit.  In order to apply for a new two-year permit, I had to submit:

1. A copy of my previous work permit
2. A copy of my passport ID page
3. A copy of my Czech biometric ID card
4. A passport-sized photograph
5. A signed power of attorney for the Bureau of Labor

The one thing that they didn't require was the nostrification of my diploma and transcripts.  I was told last year that having the nostrification would be mandatory for all non-EU citizens when applying for, or renewing, a Czech work permit.  Well apparently the rules changed.  Now it is only necessary when applying for a new work permit.  Since I am renewing an existing work permit, the nostrification is not necessary.

I'm really glad that I was notified about this change.  I gave up an entire day of my vacation in Atlanta just running back and forth between the University and the court house to get the apostille needed in order to apply for nostrification.  And poor Steven had to drive me back and forth across town to get it done.

Since I have everything ready for nostification I was advised to go ahead and do it even though I don't need it.  The reason was that "you never know when the rules will change again".  That's comforting.

I received my first work permit when I was still in the USA.  It was valid for two years.  In 2011, I received my second work permit.  It too was good for two years.  This new one will hopefully be the last one I ever have to apply for.  This permit will last until 2015.  However, I will be eligible to apply for permanent residency in 2014.  Getting permanent residency is not the same thing as getting citizenship.  And I will not give up my American passport.  Having permanent residency doesn't even mean that I will live here forever.  But the big benefit for me will be that with permanent residency I will never again have to apply for a work permit or a new long-term visa. 

So here's to applying for, hopefully, my last Czech work permit.  I should have it in about 30 days.  In the meantime, now I also have to start gathering all of the documents needed in order to apply for my last long-term visa.

Update March 2013:  It's now the end of March and I still don't have my new work permit.  Apparently, there is some delay and the Czech government is way behind.  I'm told that it should be ready within another week or two.

Update April 2013:  I finally received my work permit on April 10th.

Nostrification

Some labor laws changed in the Czech Republic which took effect this year.  I think that politicians are trying to be proactive about protecting Czech workers (and voters) in light of the current global financial situation.

The first change is that non-EU citizens, which includes Americans, Canadians, Australians, Russians, Ukrainians, etc., can no longer be employed by companies as a subcontractor.  You can only hire non-EU citizens as regular employees.  I think that this was meant to protect Czech jobs from foreign workers.  In my humble opinion this change will actually produce the opposite of the intended effect.  What this tells companies is that the work around is to give non-EU citizens the regular employment contracts and give the subcontractor contracts to EU citizens.  Fortunately, this one doesn't effect me at all.

The second change is that in order to issue a new, or renew an existing, work permit an applicant's educational history must be validated.  So even though I gave the Czech government a copy of my master's diploma three years ago I now need to go through nostrification.

Nostrification is the process of granting recognition to a degree from a foreign university.  Basically, I must find a public Czech university to certify that my degree is equivalent to a course of study offered by their university.  Here's where I get annoyed...

I have an MBA and public universities in ČR don't offer MBAs, only private institutions do.  Secondly, my degree is AACSB accredited which is the highest level of accreditation that can be achieved by a business school.  Less than 5% of the world's 13,000 business programs have this.  No institution in the ČR has this level of accreditation but I need to have a Czech university authenticate that my degree is equivalent to what it offers.

I'm hoping that Masaryk University, here in Brno, will validate that my MBA is equivalent to their Master's program in Economics and Management.  Here's what I have to do to make all of this happen.

1. I have to get notarized copies of my diploma and transcripts from Georgia State University.
2. I need to get an apostille for each notarized copy.
3. Most institutions required government approved Czech translations.  Fortunately, Masaryk allows for the documents to be in either Czech or English.
4. Submit an application to the university for nostrification.  The whole evaluation process should last 30 to 60 days.

So what's an apostille?  I sure as hell had never heard of it before but it does make a lot of sense.  It is basically a "super notary" that is valid between countries that authenticates the validity of public documents such as birth certificates, marriage licenses and educational records. 

The USA has delegated this responsibility to each state where the document was originally issued.  A public document issued in Georgia can only receive an apostille from the State of Georgia.  A document issued in California can only receive an apostille from the State of California.

I made a copy of my diploma and had a Georgia notary stamp and notarize it.  I took it to the Georgia Superior Court Clerks' Cooperative Authority in Atlanta which is the only place authorized to grant an apostille.  They gave me the necessary validation within 10 minutes and it only cost $3.

However, the transcripts were a different story.  For some reason, they will only issue an apostille on student transcripts if the university issues the official notary.

So after multiple trips back and forth between the court office and GSU, I finally got what I needed.  Again, in and out in less than 10 minutes and only another $3 fee.

Dealing with all of this bureaucracy is not exactly what I wanted to do while on vacation.  My work permit is good until April 2013 so I'm ahead of the game in getting together what I need.  Thank goodness that I just happened to already have this trip home planned.  This would have been a royal pain in the arse if I had needed to try to coordinate this from Brno.  Once I get the nostrification completed then I won't have to ever deal with this again.

Birth Number

When I got back from vacation I had two notices in my mail box. One from the post office telling me to come sign for a letter and one from the foreign police telling me to pick it up within 10 days. I had no idea what this was all about. I wondered if I was getting deported or something. Well it turns out I’ve been issued a Czech Birth Number.

Rodné číslo is better translated as a birth registration number and all Czechs have one. This number is recorded on one’s birth certificate, is valid for life, and cannot be changed unless under certain special circumstances. They use this same system in Slovakia too.

The number is 10 digits long and it can always be divided 11. The format is YYMMDD/XXXX. The first six digits are a person’s birthday followed by a slash and four more numbers. You can tell a person’s gender because the number 50 is added to the MM for women. The first three digits after the slash indicate where the person was born and the last number makes the whole thing divisible by 11.

Kind of like a U.S. Social Security Number, Czechs use their birth number for all sorts of things. It’s used on health and social security forms, for taxes, and employment contracts. Lucky for me, work provides me with a mobile phone, but if I wanted to get one on my own I have two options. I could buy phone credits or I could get a contract for service, but the contract normally requires a birth number.

When I arrived here I asked about getting a birth number. Foreigners can apply to the Ministry of the Interior for a birth number but the application takes about 30 days and costs 1,000 Kč (~$50). Since I didn’t seem to have a need for it I didn’t bother applying for one. And I didn’t want to volunteer for more Czech bureaucracy.
I’m still not sure how I received a Czech birth number. Maybe it was part of getting my visa renewed? But that was back in April and my birth number was issued in July. Who knows? IBM HR is now updating my birth number with the health insurance and social security companies. It looks like I’ll also get a new VZP card with the updated number.

EDIT: I will only receive a new VZP, with the updated number, once I have received permanent residence in the Czech Republic. You can normally apply for permanent residency after you have been here for five years and pass a Czech language test given by the state.

Wages, Taxes and VAT

When you refer to wages here, they are in monthly terms; not annually like in the U.S. The average gross Czech income is around 19.000 Kč per month (~$1,056 U.S). But about 2/3rd don’t reach the average gross wage. Like other places, the technical and financial fields earn the highest wages while agriculture and textile workers have the lowest.

The labor code sets the minimum wage here at 48,10 Kč (~$2.67) per hour or 8.000 Kč per month (~$444). How in the heck do people here make it on the minimum wage?
Income tax here is 15% but I’ve heard that this may go up, quite a lot, depending on how the upcoming elections turnout. Employees contribute 8% for social security and unemployment insurance while the employer contributes 26%. Health insurance is 4,5% for the employee and 9% for the employer. Basically, you give up 30% of your monthly paycheck to taxes. Oh yeah, you get paid once a month here. Not twice a month or every two weeks like back home.

We don’t have VAT (value added tax) in the U.S. but most other countries do. It is a consumption tax levied on any value that is added to a product. All this means to me is that the sales tax here is 19% on goods & services. A reduced rate of 9% is charged for food, medication, newspapers, books, heating & water.

Update:  In 2012, the VAT rate has increased.
Update:  In 2013, the VAT rate increased as well.
Update:  In 2019, the minimum wage increased again.