(Czech Supreme Court Judgment No. 21 Cdo 905/2014 of 24th February 2015)

Here, the Supreme Court dealt with the question of whether employment could have arisen based on an oral or implicit agreement. The court reviewed the facts of a case in which the defendant had sold the claimant’s goods in its mobile shop for an agreed compensation of 10% of revenue for roughly a 3-hour period daily based on an oral agreement between the parties.

The Supreme Court attributed to this activity the signs of dependent activity ensuing from the provision of § 2(4) of Act No. 262/2006 Coll., the Labour Code, as the activity was  performed  personally  by  the  defendant  within  the relationship of the claimant’s superiority and  the defendant’s subordination, under  the  claimant’s instructions, in the claimant’s name, for a remuneration, within the working hours (or otherwise determined or agreed time) of the claimant at an agreed place and at the claimant’s costs and liability. As dependent work may be performed – as ensues from the provision of § 3 of the Labour Code – exclusively in an employment relationship under the  Labour Code (where  not addressed  in special regulations), the Supreme Court concluded that a civil relationship could not have arisen between the claimant and the defendant, but only an employment relationship based on an employment agreement or agreements on work performed outside of employment. The lack of a written agreement establishing an employment relationship between parties cannot be an obstacle to the existence of such a relationship, as an employment contract or contract for the performance of work could also have been executed orally or implicitly (as arises from the above).

The Supreme Court thus rejected the court of first appeal’s finding that the legal relationship between the claimant and the defendant constituted a relationship based on a contract of mandate under the Civil Code.