Even as more and more students realize the importance of gaining real-world work experience prior to graduating, the government has thrown up an administrative barrier for employers willing to offer students part-time jobs.
Starting in October last year, a new law on employment has made students employees of the companies they are working for, effectively eradicating previous tax advantages. Under the law, if an employment contract exceeds 100 hours weekly and wages surpass Kč 5,000 (€ 166) monthly, student workers have to be treated as long-term employees and their employers must pay the health and social insurance payments which for students is already covered by the state. Although these stipulations were in place prior to the new law, students got around the tax payments by hopping between job agencies. The incoming law closes that loophole.
“Under the current law, when we want to employ a student, we have to deal with the barrier of administration and tax rules,” said Jan Hladký, a lawyer at the Havel and Holásek law firm, which hires law students as trainees. “Just a little change of the rules for students would make a great change for the employers.”
Changing the administrative rules for companies that employ students and providing tax relief for those working part time is exactly what Waltr Bartoš, the ODS shadow minister of education, will be trying to pursue in Parliament in a couple of weeks. “Students should not be treated as common employees on the labor market,” Bartoš said. “They need work experience and the chance to support themselves during their studies.”
Bartoš plans to propose a change to the Labor Code, which would apply only a 15 percent tax on student work and do away with the requirement of paying health and social insurance.
For Bartoš, introducing new regulations for student work is just the first step in reforming the entire education system, including the introduction of tuition. “The new rules for student employment should give them a chance to support themselves during their studies before the tuition fee is introduced,” Bartoš said.
While the tuition fee is a political hot potato for most politicians and the Social Democrats (ČSSD) are reluctant to approve it, Bartoš said he expects broad support from across the political landscape. “Education is a priority all over the political spectrum and advantageous tax conditions for students and less administration for their employers will be appealing,” Bartoš said.
According to Simona Weidnerová, the executive director and project manager of the Institute for Social and Economic Analyses, a nonprofit organization that issued a report on student employment regulations, tax relief for students would result in more money in the state coffers. “The tougher legislation has resulted in attempts by both students and employers to circumvent the Kč 5,000-wage monthly and 100-hour yearly limits to avoid administration and extra payments,” Weidnerová said. “Moreover, if there was less administration, there would be more jobs for students and so more income from their taxes.”
For students, the work experience during their studies is the decisive factor for getting a job after school. Zdenka Vostrovská, from the department of industrial policy at the University of Economics in Prague, says work experience is what all human resources managers require from potential employees. “Even part-time job experience is a major advantage and all students should have it,” Vostrovská said.
She estimates that more than 60 percent of senior students at the University of Economics have jobs. “We are trying to send the students to companies where they work on particular projects [related to] their diplomas,” Vostrovská said.