Of interest.

Employee participation in the supervisory boards of joint stock companies is back

On the basis of amendment No. 458/2016 Coll., which amends Act No. 90/2012 Coll., on Commercial Companies and Cooperatives (Business Corporations Act) (the “Business Corporations Act“), which entered into force on 14 January 2017, the compulsory participation of employees in supervisory boards of joint-stock companies with more than 500 employees in the permanent (full-time) employment was re-introduced, so-called co-determination.

Newly, if a joint-stock company has more than 500 permanent employees, the number of members of the supervisory board must be divisible by three, i.e. the supervisory board must have at least three members. In this case, 2/3 of the members of the supervisory board are elected by the general meeting of the company and 1/3 of the members are elected by the company’s permanent employees.

The provisions of the articles of association and the composition of the supervisory board of the concerned companies should be brought in compliance with the new legislation within 2 years from the effective date of the amendment, i.e. by 14 January 2019.

As already mentioned, the new legislation applies to joint stock companies with more than 500 permanent employees. However, given that a joint-stock company may have a dualistic or monistic system of internal organization, there is a lack of clarity in the interpretation of introduced legislation. It is not entirely clear from the text of the Business Corporations Act or from the existing interpretative practice whether the statutory regulation of employee participation applies only to dualist joint stock companies or even to joint stock companies with a monistic system of internal organization. At the same time, it can be stated that this legislation does not apply to limited liability companies, even if they have a supervisory board.

In connection with the above mentioned, we are happy to discuss with you the legal opinions of the professional public regarding the application of the new legislation and we can propose a concrete solution for your situation or if needed to help you implement suitable alternative solutions.

With regard to the forthcoming deadline for ensuring the compliance of the articles of association and the composition of the supervisory board with an amendment to the Business Corporations Act, we recommend that you proceed with the necessary legal arrangements as soon as possible, whereas we are ready to provide you with the necessary legal support.


Should you have any questions or queries, do not hesitate to contact us.


Mgr. Bc. Štěpánka Vajdová, junior lawyer – vajdova@plegal.cz

Mgr. Jakub Málek, attorney at law – malek@plegal.cz


20. 12. 2018