The presented article deals with labour market institutions and labour market performance in the European Union, especially within Visegrad group countries. A set of institutional aspects such as employment protection legislation, structure of wage bargaining, taxation of labour and the system of unemployment and social benefits determine the institutional framework of labour market. The paper is composed of the comparative analysis of selected criteria and corresponding economic indicators of the EU Member States. The author has chosen the method of comparative analysis as the basic method for accomplishing the goal of the paper - to analyse the labour market institutions and their contribution to labour market performance in the EU Member States. The evidence shows that the labour market flexibility is higher in the Visegrad group countries than average of "old" EU-15 Member states.