The minimum wage will increase from 1 January 2027 by CZK 2,500 to CZK 24,900 per month. The hourly minimum wage for a 40-hour working week will rise from CZK 134.40 to CZK 148.30 (MPSV).
This is the largest year-on-year increase so far. In 2026 the minimum wage is CZK 22,400.
How the amount is calculated
Since the valorisation mechanism was introduced into the Labour Code, the minimum wage is no longer negotiated at the tripartite. It is calculated as the Ministry of Finance’s forecast of the average gross monthly wage for the next year multiplied by a coefficient set by government regulation. The government sets the coefficients every two years.
- For 2027 the coefficient is 0.446, so the minimum wage will be about 44.6% of the average wage.
- For 2028 the coefficient is 0.458 (about 45.8%). According to the government, this means a minimum wage of about CZK 26,900 in 2028; the exact amount will be confirmed next year (Government).
- The Ministry of Labour’s stated goal is a minimum wage of 47% of the average wage in 2029.
The increase of the minimum wage has an impact not only on employers, who must pay employees at least CZK 24,900 per month for full-time work, but also on several tax and insurance limits.
Pension exemption
- State pensions are exempt from income tax if they do not exceed 36 times the minimum wage. For 2027 the limit will be CZK 896,400 per year (2026: CZK 806,400).
Health insurance
- For persons without taxable income (OBZP), the minimum wage is the assessment base. Their monthly health insurance payment will increase from CZK 3,024 to CZK 3,362 (13.5% of CZK 24,900, rounded up).
- Employers need to keep this minimum in mind as well, for example for an employee working part-time for less than the minimum wage or an employee on unpaid leave. Unless an exception applies (for example, the minimum is already covered by another employer), the insurance must be paid at least from the minimum wage.
Child tax bonus
- A parent can receive the child tax bonus (the part of the child tax credit that exceeds the tax and is paid out) only if their active income – from employment or self-employment – reaches the statutory limit derived from the minimum wage.
- For the annual bonus, the limit is 6 times the minimum wage. For 2027 this is CZK 149,400 (2026: CZK 134,400).
- For the monthly bonus paid by the employer, the employee’s income in the month must reach at least half of the minimum wage, i.e. CZK 12,450 (2026: CZK 11,200).
Maximum earnings of persons registered at the labour office
- Jobseekers registered at the labour office can earn up to half of the minimum wage, i.e. CZK 12,450 per month from 2027 (2026: CZK 11,200).
- As before, they cannot receive unemployment benefits during this time and cannot work under an agreement to perform work (DPP). They can use an agreement on work activity (DPČ) or a part-time employment contract.
What about the self-employed (OSVČ)?
- Minimum social and health insurance advances of the self-employed are not derived from the minimum wage but from the average wage set for insurance purposes. The same applies to the flat-rate tax and the 23% tax band. We will cover these 2027 figures in a separate article once the government regulation is final.
This article is general information, not legal or tax advice for your specific situation.