Establishing a Temporary Employment Agency (TEA) in Slovakia is a complex process that involves meeting various legislative, financial, and administrative requirements. This article provides an overview of the key steps and conditions that an individual or legal entity must fulfill to obtain a license to operate a TEA.
Who can establish a temporary employment agency?
A Temporary Employment Agency can be established by either a legal entity (such as a limited liability company, s.r.o.) or an individual. In the case of a newly established company, the minimum capital required is EUR 30,000. An existing company that is already operating in the market must demonstrate equity of at least EUR 30,000 based on its financial statements. If this condition is not met, it is not possible to obtain a license to operate a TEA.
An individual wishing to operate as a TEA must demonstrate that they have equity of at least EUR 30,000 and must have a bank guarantee of at least EUR 15,000. It is also necessary for this individual to have a second-level university education.
Conditions for obtaining a license
The Employment Services Act sets out several conditions that must be met to obtain a license to operate a TEA:
- Good Character: The person applying for the license, as well as the person acting on behalf of the TEA (in the case of a legal entity), must have a clean criminal record.
- No Outstanding Debts: The applicant must not have any outstanding debts with the tax office, customs office, Social Insurance Agency, or health insurance companies.
- Own Premises: The applicant must own or rent premises suitable for operating a TEA. This is demonstrated by a lease agreement or the owner’s consent to use the premises.
- Financial Security: A legal entity must demonstrate that it has at least EUR 30,000 in equity. For an individual, a bank guarantee of at least EUR 15,000 is also required.
- University Education: The applicant or the person acting on behalf of the legal entity must have a second-level university education.
- Activity Execution Project: The application for a license must include a project outlining the execution of the TEA’s activities, which includes an estimate of expected revenues and expenses, as well as the agency’s material and personnel resources.
Procedure for submitting a license application
The application for a TEA license is submitted to the Central Office of Labour, Social Affairs, and Family. The application must include several documents, including the activity execution project, proof of ownership or rental of premises, bank guarantee, and documents proving the agency’s material and personnel resources.
The fee for submitting the application is EUR 1,000 for legal entities and EUR 500 for individuals. If submitted electronically, the fee is reduced to EUR 930 for legal entities.
The processing time for issuing the license is approximately 1.5 months, during which the application is evaluated. If the company or individual does not meet any of the conditions, the license may not be issued. However, if you need to start operating immediately, there is the option of purchasing an existing agency with a valid TEA license.
Person acting on behalf of the temporary employment agency
When establishing a TEA, it is necessary to appoint a person who will act on behalf of the agency. This person must meet the conditions of good character and must have a second-level university education. The law does not require that this person be employed by the agency. In the case of legal entities, this person acts on the basis of a power of attorney or as a member of the statutory body. In the case of a foreigner, a criminal record extract from the home country with an official translation and recognition of the education level in Slovakia must be provided.
Difference between temporary assignment and employment mediation
In practice, the term temporary assignment of employees is often confused with employment mediation. If an agency intends to employ people under a work contract and temporarily assign them to another employer, this is a TEA activity. If the agency only wants to mediate employment without employing workers, it is a tied trade – employment mediation for a fee.
Establishing a Temporary Employment Agency requires thorough preparation and compliance with many legislative requirements. Potential founders must demonstrate financial security, suitable premises, good character, and professional education. Although the process is challenging, it allows agencies to enter the labor market and provide essential services to employers and employees in Slovakia.