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Austria is a landlocked Alpine country in central Europe made up of 9 federated states. Austria has a high GDP (among the top 20 largest economies in the world), and consistently ranks high on quality of life indicators.Since Austria became a member state of the European Union in 1995 it has gained closer ties to other EU countries.
The following agreements are available in Austria:
Under the EOR model, the following job titles are restricted in Austria:
Regular working hours are:
If the total working time exceeds 6 hours, it must be interceded by a rest period of at least half an hour. This break is not remunerated and it is not part of the working time. After the end of the daily working time, the employee is entitled to an uninterrupted rest period of at least 11 hours.
An employee is entitled to a continuous rest period of 36 hours, beginning at 1 p.m. on Saturday and encompassing Sunday (referred to as the weekend rest). However, there are exceptions to this rule. If an employee works during the weekend rest, they are entitled to an uninterrupted weekly rest period of 36 hours extending beyond the weekend.
Any work beyond 8 hours per day and 40 hours per week is considered overtime. Employees should not work more than 20 hours of overtime per week. The daily total working time may not exceed 12 hours including overtime.
In case of extension of working hours via collective agreement, the total working hours inclusive of overtime should not exceed 60 hours per week and 13 hours per day. However, the weekly working time may not exceed 48 hours on average over 17 weeks. Collective agreements may provide otherwise.
Austria does not have a statutory minimum wage. However, the Austrian law against wage and social dumping (Lohnund Sozialdumping-Bekämpfungsgesetz) regulates that similar wage conditions must apply to those working in Austria in the same branch. This is currently 1,700 EUR per month for a full-time employee.
The maximum probation period in Austria is 1 month. During this period, no notice period is applicable. The employment relationship can be terminated at any time without explicit reasons and without having to comply with terms or dates.
It is customary to pay 13th and 14th salaries in Austria -- the annual salary is paid in 14 equal payments. The 13th and 14th payments are paid out in June and November.
In Austria, there is a multi-level progressive scale of income tax (from 0 to 55%) on earnings from employment (wage tax – Lohnsteuer). The level of income tax depends on the taxable income received in a calendar year. The calendar year is the same as the business year and comprises a period of 12 months.
In addition to income taxes, employees also contribute to the social security system at an approximate rate of 18.3%.
In Austria, mandatory employer costs encompass various expenses and contributions that employers are obligated to cover for their employees. The total employer taxes and contributions are approximately 29.9% of the monthly wage.
The social security contributions are the sum of the following contributions:
Accident insurance ceases to apply from the age of 60. As a result, the percentage of social security contributions changes by 1.10%.
Employees are entitled to a minimum of 5 weeks of paid annual leave per year of work. After 25 years of service, this entitlement increases to 6 weeks. Part-time employees are entitled to the same annual leave as full-time employees.
Proportionate Entitlement for New Employees: In the first 6 months of the first year of employment, the leave entitlement is calculated proportionately based on the time worked. From the start of the 7th month, employees receive the full leave entitlement. From the second year of employment onwards, the full leave entitlement accrues from the beginning of the working year.
Illness during Leave: If an employee falls ill for more than 3 calendar days while on leave, those days do not count as part of their annual leave. However, the illness must be reported to the employer immediately after three days of absence, and a medical certificate must be provided.
Annual leave carry-over: Unused annual leave can be carried over into the following year.
Sick leave entitlement varies based on the length of employment:
Any sick leave beyond the above entitlement is covered by social security. A medical certificate must be provided.
If an employee experiences renewed illness within a working year, they are entitled to continued payment of remuneration only to the extent that it has not yet been exhausted by previous sick leave. If half of the salary is paid due to entitlements under labor law, one half of the sick pay is suspended, i.e., the employee is entitled to 50% of the original amount from social insurance.
In the event of an accident at work or occupational disease, workers are entitled to continued payment of wages without regard to other periods of incapacity for work for up to 8 weeks per occasion. This entitlement increases to 10 weeks if the employment relationship has lasted uninterruptedly for 15 years.
Expectant mothers are prohibited from working during the final 8 weeks before their due date, with maternity protection extending for 8 weeks post-delivery. Should the pre-delivery protection period be shortened due to an early arrival, the post-delivery protection period can be extended up to 16 weeks, compensating for the shortfall.
For premature births, multiple births, or caesarean sections, the post-delivery protection period is at least 12 weeks.
Maternity leave can be shared between mothers and fathers. regulations apply not only to mothers but also to fathers.
The maternity leave begins at the earliest following the mother's ban on working after the birth of the child (protection period) or - if the maternity leave is divided - following the maternity leave of the mother or father. It ends after the notified (= agreed) duration, at the latest on the day before the child's 2nd birthday. Work must therefore be resumed on the child's 2nd birthday at the latest. The maternity leave can be shared between the parents two times maximum. One part of the maternity leave must last at least 2 months.
Fathers are entitled to 1 month of unpaid paternity leave which may begin any time after the child’s birth up until the child turns two. This month of leave is often referred to as ‘Daddy Month.’ The new father must notify his employer 3 months before the estimated date of birth to be granted this leave.
Mothers and fathers are entitled to unpaid parental leave until the child reaches the age of 24 months (maximum), provided the parent lives in the same household as the child. The minimum period of parental leave is 2 months. The dismissal and termination protection ends four weeks after the end of the parental leave.
During parental leave, and provided the conditions above are satisfied, childcare allowance (Kinderbetreuungsgeld) may be drawn.
If an employee has to care for a family member living in the same household, one may, under certain conditions, be given time off work and continue to receive pay. Time-off for care responsibilities is granted for one week. One further week per calendar year is possible if a child who is not yet 12 years old falls ill again and requires care (10 working days in total).
Employees may take 1 day of compassionate leave in order to care for severely ill children or to be with dying relatives or may reduce or rearrange their working hours in such cases (the exact days leave will be outlined in the employee’s collective bargaining agreement or employment contract).
Employees may take leave in the case of their own marriage. The exact number of days will be outlined in the employee’s collective bargaining agreement or employment contract.
Educational or study leave may be agreed upon with the employer after 6 months of uninterrupted employment. The minimum period is two months, the maximum period is one year. If education or study leave is taken in parts, each part has to last at least two months. It is possible to take study leave in individual periods spread over up to four years.
Wages and salary will not be paid during this period, but the employee will receive a further training allowance (Weiterbildungsgeld) from the Employment Service (AMS) equivalent to the level of unemployment benefit to which they are entitled. The employee must participate in a further training measure of at least 20 hours per week.
There are 13 Public Holidays in Austria. Employees who work on public holidays are entitled along with regular pay, compensation equivalent to work performed on such holidays i.e. 100 percent premium, unless time off in lieu has been agreed between the employer and employee.
Employers in Austria can typically offer the following benefits:
In Austria, the process of ending an employment relationship can vary based on the initiator of the termination and the underlying reasons. Here's an overview:
a. Regular Termination:
b. Immediate Termination (for Cause):
a. Regular Termination:
b. Immediate Termination (for Cause):
The employer's notice of termination is not subject to any special content or form requirements, meaning no special reason is required. However, it's crucial for the employer's intention to terminate the employment relationship by notice to be clearly recognizable. In practice, using the written form is recommended for evidentiary purposes.
Employees have the right to terminate employment relations by serving notice to the employer. The minimum notice period is determined by the applicable national collective bargaining agreement or the terms of the employment agreement.
In Austria, it's possible for an employee to receive payment in lieu of notice. Typically, when an employment contract is terminated, either party must adhere to a notice period ("Kündigungsfrist"). However, if the employer wishes to release the employee immediately without requiring them to work during the notice period, they can choose to provide a termination payment instead. This payment is referred to as "pay in lieu of notice" ("Abfindung").
Upon termination of the employment contract, the worker is entitled to severance payment from the Mitarbeitervorsorgekasse fund except in the following circumstances:
In addition to the severance payment upon termination of the employment, employees are also entitled to:
In Austria, it’s customary to pay out 13th and 14th salaries in June and November. Employment contracts must be in German or English and can be bilingual.
★ 20.98% - Social Charges (up to EUR 6,060)
★ 3.7% - Family Burden Equalization Fund
★ 3% - Municipal Tax
★ 1.53% - Pension Fund
★ 0.34% - Pension Supplement to employers contribution
★ 0.35% - Continuing education fund
You've sourced a full-time employee or contractor located in a country where your company is not incorporated.
Pass us the details of your candidate and we will let you know exactly what it costs to employ your candidate in that country.
Sit back and relax as we onboard your new team member and take care of all the local compliances and admin work.
It can be prohibitively expensive to establish an entity in every country you want to hire talent in, so Remofirst will hire and pay your employee on your behalf while you manage their daily duties. Remofirst will handle formal HR procedures and employment contracts that adhere to local laws, so that you can simply approve invoices via our platform. When you work with an Employer of Record (EOR) you can compliantly hire the best employees around the world.
Unlike full-time employees, contractors work on projects with multiple companies at a given time and are technically self-employed. Full-time employees are solely focused on their employer and usually receive benefits (such as health insurance, equity or stock options, and time off) as an additional form of compensation. While it can be cheaper to work with international contractors instead of paying benefits to a full-time employee, you run the risk of misclassification. It's recommended to work with an EOR for contractor onboarding and payments, so you can know that your international contractors are paid compliantly and on time.
