In this week’s Business News: Czech redundancy payments some of lowest Europe-wide; inflation rises but still way below target rate; rail company faces one billion crown bill; survey reveals happy Czech bank customers; and car sector sees turnover soar in 2014.
Czech dismissal costs some of lowest in Europe
Photo: suphakit73 / FreeDigitalPhotos.net
The costs of sacking top and experienced managers in the Czech Republic for their employers are some of the cheapest in Europe, according to a survey by Deloitte Legal, the arm of the international consultancy. It carried out a survey of dismissal costs in 29 European counties. Czech labour rules result in basic dismissal charges being cheaper than in neighbouring Poland and Slovakia. One factor is that redundancy payments are the same if you have served two years with the same company or more than 15.
Inflation rate climbs but central bank cautious
Photo: Kristýna Maková
Czech year-on-year inflation ramped up in May to the relatively high level of 0.7 percent. That is the highest rate since October 2014. But the news of more robust price rises than expected did not bring rejoicing from the Czech National Bank, which is keen to see prices rises moving up to its target of around 2.0 percent. It pointed out that the core inflation rate was 0.5 in May if you take out the impact of some indirect tax rises. Higher prices for fruit and vegetables, cigarettes, and utility charges apart from electricity were among the biggest factors in latest figures.
Rail company faces one billion bill for cancelled power contract
Photo: Filip Jandourek
The Czech company responsible for maintaining the rail network has lost a five year court battle and now faces a more than one billion crown bill. The state controlled company signed a long term contract to buy electricity from dominant electricity producer ČEZ in 2008. The rules then changed and the rail company sought to cancel the long term contract and shop around for cheaper supplies. ČEZ objected and sued for 800 million crowns. Interest and legal costs have now taken that bill to over one billion crowns.
Czech bank customers second happiest in world says survey
Photo: Filip Jandourek
Czech bank customers are some of the most satisfied in the world according to the, perhaps surprising, survey results by the company Capgemini and grouping of banks and insurers, EFMA. Their annual retail banking survey put Czech customers as the second most satisfied in the world after Canada. The overall satisfaction score in the Czech Republic jumped by 3.5 points to 77.5 points compared with the last survey in 2013. The overall trend, especially in Western Europe, was of lower customer satisfaction and an increasing number of clients saying they are ready to switch to another service. One of the reasons is the closure of local branches and increased competition from everyone from supermarkets to phone companies now offering financial services.
Car sector responsible for quarter of industrial production
Photo: Tomáš Adamec
Czech car and car parts producers boosted their turnover in 2014 by almost 15% to total around 991 billion crowns, the Automobile Industry Association announced this week. Their industrial exports rose by just over 15% to 845 billion crowns. The car sector now counts for a quarter of all Czech industrial production, just over 23 percent of exports, and just under 7.5 percent of total Gross Domestic Product.
