Austria PEO Services
Working in Austria
In Austria, there is a legal requirement to pay two additional months’ salary.
Please be mindful of this when negotiating terms with new candidates. Clients can determine that the salary on offer includes these statutory payments which will be reflected in the contract of employment but this should be made known to your candidate in the pre-hiring stage.
We invoice for these additional salaries monthly and funds are accrued to be paid out at the appropriate time.
Thinking about expanding into Austria?
Social insurance in Austria is composed of health, pension and accident insurance and typically covers:
Employers are responsible for registering their employees with the relevant social insurance office and may be registered with different insurance institutions depending on their profession and the province they are working in. Social insurance contributions are deducted by the employer and paid over to the local tax office.
As a guide, the following employer costs are payable in Austria:
Accident insurance covers accidents at work and occupational disease. AUVA (Allgemeine Unfallversicherungsanstalt — the Austrian Workers’ Compensation Board) is the social insurance for occupational risks. Financed mainly by contributions paid by employers, its legal duties are:
The accident insurance scheme covers employees while at work or travelling to or from work. Cover includes measures to prevent accidents as well as benefits in the event of injury. All persons employed under an employment contract are subject to compulsory accident insurance.
According to the Austrian Working Time Act (Arbeitszeitgesetz), the regular working hours are eight hours per day (40 hours per week).
It should be noted that, in principle, overtime is payable in Austria when the regular working hours are exceeded (per day or per week).
The right to overtime in Austria is stipulated by law as mandatory and cannot be altered or waived. It is possible to include an all-encompassing salary (included as gross pay element) to compensate for overtime. It is important to note, however, that such all-in clauses may not deteriorate the employee’s position as compared to a situation in which a basic salary plus additional payments for overtime are paid.
Based on the employee’s job role and proposed salary, our Austrian legal team can determine the extent of any additional gross overpay required to be stipulated in the employment contract.
Notice periods are governed by statute according to the length of service.
Severance pay fund (Mitarbeiterervorsorgekasse)
New severance pay provisions were introduced from 1 January 2003 in accordance with the Company Employees Provision Act (BMSVG) for new employment relationships. The fund does not pay out if the employee terminates the contract.
An employee is entitled to freely dispose of any accrued severance pay if certain provisions are met:
From the second month of employment onwards, an employer pays 1.53 % of the gross salary in contributions to the health insurance fund, which in turn passes the contributions onto a staff provision fund (Vorsorgekasse).
The staff provision fund invests the contributions and credits them including the returns on investment (after deduction of administration costs) to the individual’s personal severance pay account. Once a year, the fund should send a statement to the employee about the current status of the fund. A legally prescribed capital guarantee ensures that, regardless of the results of the investment, the final severance pay sum cannot be lower than the amount paid in by the employer.
PEO Worldwide works with the staff provision fund BONUS VORSORGEKASSE.
Employees are entitled to a minimum of five weeks in each year of work (25 days).
When calculating leave according to working days (incl. Saturdays), the entitlement is 30 days leave each year.
After 25 years of service this entitlement increases to six weeks.
Statutory/public holidays in Austria
|Neujahr||New Year’s Day||1 January|
|Heilige Drei Könige||Epiphany||6 January|
|Staatsfeiertag||National Holiday||1 May|
|Christi Himmelfahrt||Ascension Day||39 days after Easter Sunday|
|Mariä Himmelfahrt||Assumption Day||15 August|
|Nationalfeiertag||National Day||26 October|
|Allerheiligen||All Saints’ Day||1 November|
|Mariä Empfängnis||Immaculate Conception Day||8 December|
|Christtag||Christmas Day||25 December|
|Stefanitag||St. Stephen’s Day/Boxing Day||26 December|