In Slovakia, generally yes: the responsible representative must have an employment relationship with the entrepreneur. For an s. r. o., the main exception is a member, who needs no employment contract while their membership continues. In Czechia, employment is unnecessary; since 2008, any contractual relationship, even unpaid, is sufficient. Watch this difference when making changes: selling an ownership interest ends the Slovak exception, and the company has fifteen days to put a new arrangement in place.
Slovakia and Czechia both started from the same federal Trade Licensing Act No. 455/1991, but it now applies in a different version in each country. The rules diverge particularly sharply for responsible representatives. A company operating on both sides of the border therefore cannot simply copy its arrangement from one country to the other.
Slovakia: employment, unless the representative is a company member
A legal entity must appoint a responsible representative if it carries on a craft or regulated trade (Section 11(6) of Act No. 455/1991 Coll.). The representative is an individual through whom the company ensures the professional performance of the activity: the company meets the professional competence requirement through that person. The Act expressly states the required relationship:
When the trade is carried on, the responsible representative must be in an employment relationship with the entrepreneur. This does not apply where, under the conditions laid down by a special Act, […] the representative is the entrepreneur’s spouse, direct-line relative or sibling, or, in the case of a legal entity, its member, or, in the case of a municipality, its mayor.
— Section 11(1) of Act No. 455/1991 Coll. (unofficial English translation)
In practice, an s. r. o. therefore has two routes: employ a professionally qualified person under an employment contract, since an agreement to perform work outside employment or a cooperation agreement with a sole trader is insufficient; or appoint a member, for whom the Act requires no additional relationship. The special Act’s conditions relate to the entrepreneur’s family members, rather than a member of the company. Further limits apply in both cases: the representative must reside in Slovakia or hold a residence permit, must not sit on the company’s supervisory board, and may perform the role at only one establishment.
The member exception lasts only while membership continues
The most common trap arises on a transfer of an ownership interest, rather than at incorporation. By selling the interest, the representative ceases to be a member, and the exception ends at the moment of transfer. Within 15 days, the company must notify the trade licensing office of termination of the role and appoint a new representative, or enter into an employment contract with the existing one (Section 11(9) and (10)). The ownership interest transfer agreement should therefore expressly flag this duty; otherwise, it may be discovered only during an inspection.
A second distinction matters: the exception addresses the Trade Licensing Act, rather than the work itself. Performing the representative’s role, providing professional assurance and supervision, will generally not satisfy the characteristics of dependent work. But if the member also actually performs dependent work for the company under instructions and at specified times, this is assessed separately under the rules on illegal work. The family assistance regime is narrowly defined and does not cover company members (Section 2a(2) of Act No. 82/2005 Coll.). We discuss this in detail in family assistance without an employment contract.
Czechia: a contractual relationship is sufficient
Under Czech law, the responsible representative need only have a contractual relationship with the entrepreneur. The requirement for an employment-law relationship was removed by an amendment effective from 2008. A mandate or another agreement, even an unpaid one, suffices. Instead of the Slovak limit of one establishment, no person may perform the role for more than four entrepreneurs. A member of a legal entity’s supervisory body is excluded, as in Slovakia. For a concession-based trade, appointment of the representative requires approval from the trade licensing office.
The representative’s responsibility and when the office intervenes
The representative is responsible for the professional aspect of operations; they are not the statutory body and do not act on the company’s behalf. Penalties primarily target the company. Failure to appoint a representative where required can result in a fine of up to EUR 1,659 (Section 65a(1) of Act No. 455/1991 Coll.); failure to notify appointment or termination can result in a fine of up to EUR 663 (Section 65a(2)). For a serious breach of conditions, the office may suspend or revoke authorisation (Section 58(2)). When a company needs a representative and how it obtains trade authorisation are discussed in trade authorisation arises on entry in the Commercial Register and notifying a regulated trade for an s. r. o..
How we can help
When a company is formed, we set up its business activities and responsible representative to match its planned operations through forming an s. r. o. in Slovakia or forming an s. r. o. in Czechia. We prepare the representative’s employment contract, consents and notifications to the authorities through corporate documentation for an s. r. o..
If you plan to transfer an interest in a company whose representative is a member, contact us before signing: fifteen days after the transfer is often too late.
This answer provides general information on the law as at 5 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.
