Facts & figures

Government Type: Federal parliamentary republic

Capital: Vienna

Currency: Euro (EUR)

Languages: German

GDP Per Capita: 51,936 USD (2019)

Main Business sectors: 70.3%

Industry: 28.4%

Agriculture: 1.3%

Employment Rate: 76.2%

Global People has a significant advantage in the Austrian market thanks to our experience in providing global employment solutions and in-depth understanding of the unique employment culture at each location.

When looking to employ in Austria, its incredibly important to understand the employment structure and be familiar with all employment rules and guidelines. 

Global People, has a significant advantage in the Austrian market thanks to:

  • Experience in providing global employment solutions
  • Extensive professional network
  • Top networking strategies and good understanding of the broad employment world and culture.
  • An accurately designed process that assures compliance and provides a tangible ROI.

Global people’s services include:

  • PEO and HR management.
  • Realistic calculation of employee compensation.
  • Payroll, tax liabilities, insurance and employee benefits.
  • A designated point of contact for the client and the employees, available for any query or question that may rise.
  • Accessible consultation and professional opinions.

Employment Manual – Austria

Austria’s employment regulation, like most members of the European Union, provides the employees with broad protection and rights. The country’s employment regulation consists of a mix of Austrian legislation, EU legislation, collective bargaining agreements and the employment contracts. Austrian collective bargaining agreements are legally binding contracts in Austria, and they create a balance of interests between the employer and the employee by establishing minimum working conditions that must be made.

The employment agreement or contract must comply with Austrian law, collective agreements and EU rules. The agreements must refer to:

  • Annual salary
  • Overtime entitlement
  • Sick leave
  • Annual Leave
  • Allowances
  • Severance pay
  • Notice period
  • Probation period



When deciding to terminate an employment, the company must inform the work council prior ending the employment relationship, if there is one in the company.

The council will comment on the planned dismissal and will agree or oppose to the dismissal. The employee has a right to appeal against the dismissal to the council.

 When considering to terminate an employee its important to make sure beforehand if the employee is subject to special protection.

The applicable notice periods and termination dates are usually established in the relevant collective bargaining agreements. Employment can end only at the end of each calendar quarter, but this rule can be changed by individual agreement to end on the 15th or the end of each month. If the employee is being dismissed due to serious misconduct, notice period is not necessary. This type of termination is referred to as “summary dismissal”.

The notice periods are as follows:

Period of employmentMinimum notice period
0-2 years6 weeks
2-5 years2 months
5-15 years3 months
15-25 years4 months
More than 25 years5 months

The employer is obliged to make a monthly contribution of 1.53 % of the gross salary to a public insurer (Mitarbeitervorsorgekasse).

The employee is statutorily entitled for severance payment if his employment has lasted for at least 3 years. The severance payment includes all the salaries and benefits due at the last day of employment. The amount given to the employee depends on the length of employment period and all his salary components:

Period of employmentSeverance entitlement
3-5 years2 months
5-10 years3 months
10-15 years4 months
15-20 years6 months
20-25 years9 months
Above 25 years12 months

Payroll Taxes

Employers contribute to the mandatory pension fund of the employee at the rate of 1.53% on monthly gross salaries.

Employer contribution is at a rate of 21.76% calculated on gross salary.


Employee Payroll Taxes

Income tax rates range from 25-55% of an employee’s gross income. Those making €11,000 or less are not required to pay income taxes (this is usually because that employee was not employed for a full year).

Income Range (EUR)Tax Rate (%)
0 – 11,000
11,001 – 18,00025%
18,001 – 31,00035%
31,001 – 60,000


60,001 – 90,000


90,00, – 1,000,000


Above 1,000,000


Mandatory Employee benefits

  • Every employee is entitled to 4 weeks paid vacation.
  • After 25 years of employment this entitlement increases to 6 weeks.
  • Unused leave can be carried over, but the leave is forfeited if not used within two years from the year in which the entitlement arose.
  • Employees are entitled to 6 weeks full salary and a further 4 weeks 1/2 salary paid by the employer.
  • Sick pay will be payable for longer periods depending on the seniority of the employee up to 12 weeks full salary.
  • In case of a work accident or an occupational disease the employee is entitled to sick payment for 8 weeks.
  • There are 13 bank or public holidays in Austria.
  • Maternity leave in Austria for mothers starts 8 weeks prior the planned date of birth and end 8 weeks following the birth (total of 16 weeks).
  • The pay amount is based on the average income earned during the 13 weeks before maternity leave begins.
  • After these 16 weeks, the mother is entitled for an unpaid leave until her child turns 2 years old.

Specific Employee Benefits and Industry Benchmarks

Most employers grant employees additional paid leave days, which amount to 5 annual weeks yearly.

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