Yes. Where the new s.r.o. takes over the unit's enterprise, or a part of it, as an economic unit, the rights and obligations arising from employment relationships pass to it by law, and new employment contracts are unnecessary. Both the foreign company and the new company must, however, inform the employees or their representatives in writing at the latest one month before the transfer. If the transfer is to alter an employee's working conditions fundamentally and the employee does not agree, the employment relationship is deemed terminated by agreement and the employee is entitled to severance pay.
People working in the Slovak organisational unit of a Czech company have their employment contracts with the Czech company itself. The unit is merely an organisational division of its enterprise (Section 7(1) of the Commercial Code), so it is not the employer. When the company decides to move the unit’s activity into a separate Slovak s. r. o., the employer changes. Where the employees habitually work in Slovakia and their contracts have not chosen the governing law, they are governed by Slovak law; nor does a choice of another law deprive them of the protection of those Slovak provisions from which no derogation is permitted (Article 8(1) and (2) of Regulation (EC) No 593/2008, Rome I). The Slovak Labour Code provides for a change of employer: where the activity is transferred as a whole, the employees pass with it, and nobody has to dismiss and re-engage them.
When employees pass by operation of law
The basic rule is in Section 28 of the Labour Code:
Where an economic unit is transferred, meaning, for the purposes of this Act, an employer or part of an employer, or where a task or activity of an employer, or part of it, is transferred to another employer, the rights and obligations arising from employment relationships towards the transferred employees pass to the transferee employer.
— Section 28(1) of Act No. 311/2001 Coll. (unofficial English translation)
What matters is whether the transferred part retains its identity as an organised grouping of tangible, intangible and personal elements (Section 28(2)). A unit transferred to the new company together with its premises, contracts, know-how and people generally satisfies that condition. On a sale of an employer or part of an employer, the Act confirms the transfer separately as well (Section 31(1)). On the assets side, the Commercial Code adds that all rights and obligations covered by the sale pass to the buyer (Section 477(1)), including on a sale of a part of an enterprise forming an independent organisational unit (Section 487).
Rights and obligations arising from employment relationships pass in the state they were in as at the date of transfer, including the agreed pay conditions. The new company must comply with a collective agreement concluded by the previous employer until its effectiveness ends (Section 31(7)), and employee representatives retain their position until the end of their term of office (Section 31(8)). Claims of employees whose employment ended before the transfer remain with the Czech company (Section 28(5)).
Informing employees a month in advance
The transfer does not require the employees’ consent, but the Act requires them to know about it in advance:
At the latest one month before the transfer of rights and obligations arising from employment relationships takes place, the employer is obliged to inform the employee representatives in writing, or, where no employee representatives operate at the employer, the employees directly, of (a) the date or proposed date of the transfer, (b) the reasons for the transfer, (c) the employment, economic and social consequences of the transfer for the employees, and (d) the planned measures relating to the employees in connection with the transfer.
— Section 29(1) of Act No. 311/2001 Coll. (unofficial English translation)
The same duty applies to the transferee employer (Section 29(3)). The new s. r. o. must therefore be formed and able to act before the information is sent to the employees, and the transfer date must be set so that the one-month period does not upset the timetable. Planned measures, a move to another workplace for instance, must be discussed with the employee representatives at the latest one month before they are implemented (Section 29(2)).
When conditions change
If the transfer is to alter an employee’s working conditions fundamentally and the employee does not agree, the employment relationship is deemed terminated by agreement on the ground set out in Section 63(1)(b) of the Labour Code as at the date of transfer, the employer issues the employee with a written document, and the employee is entitled to severance pay (Section 29a). Changes to the place of work, pay conditions or working time should therefore be considered before the transfer and explained to the employees in the information under Section 29.
What we recommend
Prepare a list of the unit’s employees with their employment contracts, internal regulations and benefits, and establish whether employee representatives operate at your company. That determines whom you inform and when. The same rules on the sale of a division of a Slovak company, including the Czech regime, are examined in our answer on the transfer of employees on a sale of part of a company. We prepare the information, the agreement on the sale of the enterprise or part of it and the timetable for the transfer date as part of the transformation of an organisational unit into a company. Whether the new company should buy the enterprise or receive it as a contribution is examined in our answer on a unit’s enterprise: purchase or contribution to an s. r. o.; what follows the transfer is described in our answer on winding up an organisational unit and its deregistration. When setting up a new organisational unit in Slovakia, we bear a later transfer in mind as early as the employment contracts.
This answer provides general information on the law as at 12 September 2026. It does not constitute legal services or replace an assessment of an individual case. The details of your situation may differ. Book a consultation to discuss them.
