Employment of Foreign Nationals: Failure to Report a New Hire Could Result in a Fine of Millions

Does a foreign national start working without prior notification? That constitutes illegal employment

Starting October 1, 2025, employers must report the hiring of a foreign worker before the worker begins work. What matters is when the work begins, not simply when the worker enters the company’s premises. If an employer fails to file the report on time and the foreign national is already working, it constitutes unreported work.

Unreported work and illegal work are distinct legal concepts. Illegal employment, for example, refers to a foreign national working without the necessary work or residence permit. In the case of unreported employment, the issue is the failure to fulfill the reporting obligation before the start of work, even if the employee otherwise has all the necessary documents in order.

Therefore, if a company allows a new employee to start a shift first and does not file the notification until the afternoon, it has failed to meet the obligation in a timely manner. Even a valid employment contract and the necessary permits do not substitute for timely notification of the start of employment.

Inspectors on Standby: Fines in the Hundreds of Millions and Clear Rules

The Labor Inspectorate is cracking down. In the first half of 2025 alone, it conducted nearly 10,000 inspections and imposed fines totaling more than 255 million crowns. An amendment to the law gives it a new tool—if an employer violates reporting requirements, the inspector has clear criteria for assessing the situation.

While it used to be possible to “work things out” and submit documents retroactively, that approach no longer holds water. The authorities will be uncompromising. Thorough record-keeping is thus no longer just a formality—it has become a necessary safeguard against penalties.

From the perspective of inspections, it makes no difference whether the business is a large corporation or a family-run business with a single employee. The rules apply equally to everyone. Companies are therefore facing a new reality in which it is no longer enough to “get the paperwork in order sometime later.” It is now essential to have everything taken care of on time—ideally even before an employee steps onto the workplace for the first time.

What requirements must an employer meet when hiring a foreign national?

The process of hiring foreign nationals begins with verifying whether the applicant has the right to reside and work in the Czech Republic. The employer must determine whether the foreign national has unrestricted access to the labor market or needs the appropriate work authorization. In addition to entering into an employment contract or the relevant agreement, the employer must also fulfill reporting and record-keeping obligations. The foreign national’s start date must be reported before they begin working.

Companies should therefore review their hiring processes, strengthen internal control mechanisms, and report every new foreign national in a timely manner. Collaborating with external experts can also be helpful. After all, a single overlooked document can end up costing much more than a carefully planned onboarding process.

This is not just a legal obligation, but also a matter of building trust with the employee. If a company acts transparently, clearly, and consistently from the start, it increases the loyalty and motivation of new employees. And in the case of foreign nationals, this is doubly true—they often have to cope with language barriers, cultural differences, or unfamiliarity with local customs. Well-managed administrative procedures thus serve as the foundation for long-term and smooth cooperation.

When is a work permit required for a foreign national?

A work permit for a foreign national is not required in all cases. Some foreign workers have unrestricted access to the Czech labor market, while others work, for example, under an employment card or a Blue Card. If a specific job applicant requires a separate work permit, it is issued by the Czech Labor Office. However, the work permit itself does not replace a residence permit. Therefore, before the employee starts work, verify that their documents authorize them to perform the specific job being offered.

What Are the Consequences of Mistakes? Fines, Advertising Bans, and a Ban on Hiring Foreigners

An employer may face a fine of up to 3 million crowns for allowing unreported work. Therefore, the amount of 100,000 CZK is not the correct upper limit for a situation where a foreign national begins working without timely notification of their start date. This lower rate applies to other cases of violations of reporting or record-keeping obligations.

Different penalties apply to illegal employment. A legal entity or a self-employed individual faces a fine ranging from 50,000 to 10 million crowns for facilitating such work . For a non-self-employed individual, the fine can reach up to 5 million crowns. Therefore, it is not just the distinction between a “person” and a “company” that matters—a self-employed individual also falls into the group subject to the higher rate.

A ban on business activities for up to two years may also be imposed for facilitating illegal employment. However, this cannot be described as an automatic ban on employing foreigners due to a delayed notification of employment commencement. Another consequence may be a restriction on the publication of job postings: if a final fine exceeding 50,000 CZK is imposed for violations defined by law, the Labor Office will not publish the employer’s job postings for a period of three months.

Employers should therefore view the reporting obligation not merely as a necessary evil, but as a tool to protect against unnecessary penalties and complications. Even a single forgotten document can trigger an avalanche of problems that should not be underestimated.