1. What types of employment contract are recognised in Austria?
The following types of employment contract are recognised in Austria:
- Service contract (echter Dienstvertrag)
- Free service contract (freier Dienstvertrag)
- Contract for specific work (Werkvertrag)
2. What are the minimum and maximum terms for which a fixed-term employment contract can be concluded in Austria?
The employment contract starts with a one trial month. Beyond this, there are no minimum or maximum terms.
3. How can a contract of employment be terminated in Austria?
An employment contract can be terminated by:
- mutual agreement between the employee and employer (Einvernehmliche Auflösung);
- the employee (Arbeitnehmerkündigung);
- the employer (Arbeitgeberkündigung);
- instant dismissal by employer (Entlassung seitens des Arbeitgebers);
- leaving without notice, instigated by the employee (vorzeitiger Austritt seitens des Arbeitnehmers); or
- dismissal in trial month, which is normally a fixed-term of one month (Kündigung im Probemonat).
4. What are the applicable notice periods, and what determines their length?
Applicable notice periods are different for employees and workers:
The notice periods for employees are defined by the Austrian Employees Act – Angestellten-gesetz (AngG) – unless the employment contract provides otherwise.
The employer may terminate the employment relationship in compliance with the following notice periods:
- less than (or exactly) two years of service: six weeks;
- more than two years of service: two months;
- more than five years of service: three months;
- more than 15 years of service: four months; and
- more than 25 years of service: five months.
The employee may terminate the employment themselves by giving one months’ notice to the last day of a calendar month. This period of notice may be extended by agreement to up to six months.
The notice periods of workers are defined by their respective collective agreements. The duration of the notice period is generally graded according to the length of service of the worker.
For industries in which no collective agreement applies, the relevant agreement in the service contract applies. If the employment contract does not contain any provisions on the period of notice, the provisions of the Austrian Trade Act – Gewerbeordnung (GewO) – shall apply, according to which a 14-day notice period must be observed.
From 2021, there will be no difference between employees and workers regarding notice periods. From then on the notice periods for employees will also apply to workers.
5. Is it possible to employ employees as teleworkers in Austria, and are there any particular regulations that apply (differentiating from other regulations)?
Yes, it is possible to employ employees as teleworkers in Austria.
Teleworkers are subject to the same statutory and collective agreements that apply to employees in comparable positions in the employers’ workplace – for example the Employees Act, the Equal Treatment Act, the Holiday Act, and the Working Hours Act.
6. What are the rights for women who become pregnant during their employment contract, and are they protected from being dismissed?
The Maternity Protection Act – Mutterschutzgesetz (MSchG) – provides maternity protection for eight weeks before and eight weeks after birth. If the eight-week protection period before birth is shortened, it will be extended accordingly after birth (to a maximum of sixteen weeks). For premature births, multiple births or caesarean sections, the term of protection after delivery is at least twelve weeks.
The period of parental leave begins for the parent who claims it first, usually eight or twelve weeks after birth (when the protection period ends). Maternity leave may also begin after a vacation or period of sick leave. If the parent who initially looks after the child is not entitled to parental leave, the other parent may take parental leave at a later date.
In the case of a permanent employment relationship, the pregnant employee may not be dismissed. Protection against dismissal commences from the beginning of the pregnancy up to four months after birth, or, if a claim is made, until four weeks after the end of the parental leave. The dismissal of an expectant mother is possible only for special reasons and only with the consent of the Labour Court.
Specific work-time regulations also apply to pregnant women, including a restriction on working during the night.
7. What types of paid days-off are the employees entitled to in Austria?
The duration of vacation in Austria amounts to at least twenty five working days per year, plus public holidays.
Sick leave has to be payed by the employer for at least six weeks.
Overtime work has to be agreed between the employee and employer, and is to be paid at a higher rate than the usual worktime pay, or as compensatory time-off.
8. Is it possible to include a non-competition clause in the employment contract, and what are the grounds for concluding a valid non-competition agreement?
In Austria there are two forms of non-competition clause – a non-competition agreement and the statutory non-competition clause:
A non-competition clause can be included in an employment contract in accordance with the Austrian Employees Act (Section 36). This clause can prohibit or limit the prospect of competitive employment for the period after the end of the employment relationship.
The non-competition clause is only admissable if the employee is of age at the time of the conclusion of the employment agreement, and is entitled to a remuneration of more than 3,480 EUR pre-tax (excluding any special payment amounts) for the last month of the employment relationship. This is equivalent to 20 times the daily maximum contribution basis for 2019, as defined by the General Social Security Act – Allgemeines Sozialversicherungsgesetz (ASVG).
The restriction of employment contained in the competition clause may only refer to the business activity of the enterprise and shall not exceed the duration of one year. At the same time, it must not deprive the employee of any opportunity to work.
Statutory non-competition clause
For employees and workers, the non-competition clause is specifically regulated by the Austrian Employees Act – Angestellten-gesetz (AngG, section 7 paragraph 1):
During the upright employment relationship, an employee is prohibited from (i) operating an independent commercial enterprise without the authorisation of the employer or (ii) concluding commercial transactions in the business of the employer for own or third party invoices.
This is further substantiated by numerous statutory dismissal regulations.
9. Is the employer obliged to pay compensation for the period of validity of a non-competition clause/agreement after the termination of employment?
The employer forfeits their rights under the non-competition clause if they terminate the employee’s employment contract. Similarly, the employee forfeits their rights if they choose to leave their employment without notice.
If the employer wishes to maintain the rights arising from the competition clause, they must pay the employee an amount equivalent to the last payment for a period of one year.
10. What happens to employees if their employer goes bankrupt in Austria, and are they entitled to severance pay?
Insolvency of the employer does not end employment.
In the event of insolvency, open claims from the employment relationship are secured by the Insolvency Fee Fund – Insolvenz-Entgelt-Fonds (IEF). Employees can register their claims as part of the insolvency proceedings and apply for bankruptcy fees at IEF-Service GmbH.
11. Are there any courts specially appointed for the purpose of dealing with labour law matters in Austria?
In Vienna, the Labour and Social Court deals with labour – both individual and collective labour law – and social court cases.
In other federal states, the general regional courts act as labour and social courts.
12. In the event that an employee is a debtor in enforcement proceedings in Austria, to what extent is it possible for a bailiff to seize remuneration?
The employee’s salary minus the minimum subsistence amount is seizable.
The subsistence level depends on the net income and any maintenance obligations.
New subsistence rates are published each year, and these are available on the Federal Ministry for Constitution, Reforms, Deregulation and Justice website.