A managing director’s remuneration in Slovakia and Czechia: who approves it, in what form, and what if it is missing

A managing director who is also a shareholder often pays themselves a monthly sum because the shareholders once agreed on it orally. The question of the basis on which the money leaves the company arises only when there is a dispute between shareholders, on a sale of the business, or in a tax audit. Yet both Slovak and Czech law answer it clearly: a managing director’s remuneration is decided not by the director but by the shareholders, and they must do so in a prescribed form. This article explains where the two sets of rules differ.

Slovakia: remuneration is approved by the general meeting

The appointment, removal and remuneration of managing directors fall within the powers of the general meeting (Section 125(1)(f) of the Commercial Code). Where the company enters into a service agreement with a managing director, it must be in writing and is approved by the general meeting (Section 66(6)). Without an agreement, the relationship is governed mutatis mutandis by the provisions on the mandate contract, which is for consideration (Section 566(1)) and, where the amount has not been agreed, confers a right to the usual consideration (Section 571(1)). Since remuneration of managing directors is decided by the general meeting, however, without its decision both the entitlement to remuneration and its amount are uncertain. What else remains open without an agreement is examined in the question on the director’s service agreement and what happens without one.

The law also prescribes the form of the minutes. The amendment effective from 17 August 2026 moved the appointment and removal of managing directors into a notarial deed, but retained an officially certified signature of the chair for remuneration:

The authenticity of the signature of the chair of the general meeting must also be officially certified where the agenda of the general meeting was a decision under Section 125(1)(f) concerning the remuneration of managing directors.

— Section 127a(3) of the Commercial Code (unofficial English translation)

A sole shareholder decides on a managing director’s remuneration in writing and the authenticity of their signature on the decision must be officially certified (Section 132(1)). Where the sole shareholder is also the managing director and enters into a contract with themselves on the company’s behalf, the contract must be in writing (Section 132(2)). A decision on remuneration is therefore a separate document to be prepared and archived, not an oral understanding among shareholders. The Commercial Code does not expressly prohibit a shareholder who is also a managing director from voting on their own remuneration; it provides for exclusion from voting only in decisions on that shareholder’s non-monetary contribution and on their exclusion (Section 127(5)). The limit is the prohibition on abusing a majority of votes (Section 56a(1)). Minority shareholders influence the level of remuneration mainly through the memorandum of association, which may require a higher number of votes for such a decision (Section 127(3)).

Czechia: without an arrangement, the office is unpaid

The Czech rules are stricter in what happens where remuneration is overlooked. The relationship between a managing director and the company is governed mutatis mutandis by the Civil Code provisions on mandate unless the service agreement or the law provides otherwise (Section 59(1) of Act No. 90/2012 Coll.). A service agreement in a capital company must be concluded in writing and is approved, including its amendments, by the supreme body; without approval it does not take effect (Section 59(2)). Where the agreement does not deal with remuneration, the office is deemed to be unpaid (Section 59(3)). The usual remuneration comes into play only exceptionally, in particular where the agreement or the remuneration arrangement is invalid for reasons on the company’s side (Section 59(4)).

The law also prescribes what a remuneration arrangement must contain: specification of all components of the remuneration including benefits in kind and pension contributions, the amount of the remuneration or the method of calculating it, the rules on extraordinary bonuses and profit shares, and any performance in the form of participating securities (Section 60). Any other performance outside the agreement, the law or an approved internal regulation may be provided to a managing director only with the consent of the body that approves the agreement and with an opinion from the supervisory body where one is established. Where the exercise of the office manifestly contributed to an unfavourable financial result, the performance is not provided unless the body that approved the agreement decides otherwise (Section 61).

Differences to watch

In a group with both a Slovak and a Czech company, it pays to check the following points:

• No agreement on remuneration. In Slovakia the mandate regime applies, but without a decision of the general meeting the entitlement to remuneration is uncertain; in Czechia the law generally leads to the office being unpaid.
• Content of the agreement. A Czech agreement must list all components of the remuneration; a Slovak agreement transplanted into a Czech subsidiary need not contain them.
• Benefits outside the agreement. A car, a phone or additional insurance require separate consent under Section 61 in Czechia; in Slovakia they belong in the approved agreement or in the general meeting’s decision on remuneration.
• Changing the level of remuneration. In Czechia every amendment to the agreement is also approved; in Slovakia, a new decision on remuneration in the form required by Section 127a(3).
• Form of the decision. In Slovakia, minutes with an officially certified signature of the chair, or a sole shareholder’s decision with an officially certified signature.

The tax and social-security treatment of a managing director’s remuneration is a separate question and should be discussed with an accountant or tax adviser; the legal side determines whether the remuneration has a proper basis at all.

How to set it up

We prepare a service agreement with complete remuneration provisions according to the country in which the company is seated, as part of our director’s service agreement service. The decision approving it and the decision on remuneration, including the required form, are handled as part of our general meeting service. Where a managing director is also a shareholder and works for the company outside the office as well, see the question on a shareholder’s remuneration without an agreement; what happens to remuneration on leaving office is examined in the article on when a managing director leaves.