Regulation of agency work and the fight against illegal work are key priorities of the European Union, which is trying to create a balanced legal framework that allows for flexibility in the labor market, but at the same time protects employees’ rights and prevents their abuse. The impacts of these two phenomena are not limited to individual employees, but have a major negative impact on the economy of states, as they often lead to extensive tax evasion and a reduction in revenues to state budgets. The aim of this chapter is to analyze the legal regulation of agency work and measures against illegal work within the European Union, then present the legal regulation in Germany, make a comparison with the Czech legal regulation and, based on these findings, present measures that would improve the legal regulation in the Czech Republic within this area.