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How to hire and pay employees in Austria
Slasify
Jun 21, 2025
Before Hiring in Austria
Discover the global hiring and employment landscape in Austria—a central European country renowned for its economic stability, innovation, and skilled labor force. Austria's strategic location and high quality of life make it an attractive hub for international business expansion.
Explore the employment essentials including payroll, personal income tax, statutory contributions, annual leaves, minimum wage, terminations, visa requirements, and more. Gain valuable compliance insights for a smooth entry into the dynamic Austria market with Slasify's global premium HR platform.
At a Glance
| Capital | Vienna |
| Currency | Euro (EUR) |
| Payroll Cycle | Monthly or Semi-monthly |
| Minimum Wage | N.A. |
| Annual Leave | 5 calendar weeks |
| Personal Income Tax | Up to 55% |
Personal Income Tax
| Taxable Income (EUR) | Progressive Tax Rate (%) |
|---|---|
| Up to 13,308 | - |
| 13,309–21,617 | 20 |
| 21,618–35,836 | 30 |
| 35,837–69,166 | 40 |
| 69,167–103,072 | 48 |
| 103,073–1,000,000 | 50 |
| Over 1,000,000 | 55 |
Local Tax
There are no local taxes on employment income in Austria. However, employers may be required to pay a municipal payroll tax equivalent to 3% of gross wages paid to their employees.
Statutory Contributions
Generally, social security contributions collected by the Austrian Health Insurance Fund (ÖGK), including those for pension insurance and unemployment insurance, among others, are calculated based on the employee’s salary of up to EUR 6,450 per month.
Special payments (e.g. Christmas bonus) shall be calculated based on an amount up to EUR 12,900 per calendar year, though they are not subject to AK and WF contributions.
Employer Contributions
| Contribution rate | Note | |
|---|---|---|
| Social Security Contributions | ||
| Unemployment Insurance (AV) | 2.95% | - |
| Employee Pension Fund (BV) | 1.53% | The salary that serves as a basis for this contribution shall be uncapped. |
| Insolvency Wage Protection (IESG) | 0.1% | - |
| Health Insurance (KV) | 3.78% | - |
| Pension Insurance (PV) | 12.55% | - |
| Social and Further Education Fund Contribution (SO) | 0.35% | This is payable by the temporary employment agency for temporary workers if the requirements are met in accordance with the Temporary Employment Act (AÜG). |
| Accident Insurance (UV) | 1.1% | - |
| Housing Subsidy (WF) | 0.5% | - |
| Other Contributions and Levies | ||
| Family Burden Equalization Fund (DB) | 3.7% | If the contribution basis does not exceed EUR 1,460 in a calendar month, it shall be reduced by EUR 1,095. |
| Chamber of Commerce Levy (DZ) | 0.31%–0.4% |
This is payable by all members of the Chamber of Commerce organization. The exact rate of contribution varies across Austria's provinces. The contribution basis shall be the same as those for the Family Burden Equalization Fund. |
Employee Contributions
| Contribution rate | Note | |
|---|---|---|
| Social Security Contributions | ||
| Chamber of Labor Levy (AK) | 0.5% | - |
| Unemployment insurance (AV) | 2.95% | A lower contribution rate may apply for those earning lower incomes. |
| Health Insurance (KV) | 3.87% | - |
| Pension Insurance (PV) | 10.25% | - |
| Housing Subsidy (WF) | 0.5% | - |
Where applicable, employees are required to make contributions to the trade union and religious community they are a member of, which shall be deducted directly from their pay.
Payment of Wages
Employers must pay employees' monthly salaries in 2 installments—no later than the 15th and last day of each month. However, it can be agreed that the entire monthly salary is paid on the last day of the month.
Minimum Wage
There is no national minimum wage in Austria. For most industries, the relevant collective agreements provide the minimum wages in their respective wage or salary tables.
Statutory Bonus
It is customary for salaries to be paid 14 times in a year, which means that employees generally expect a 13th and 14th month salaries. These are usually paid out in June and November of each year, respectively.
Termination
Apart from certain legal and contractually agreed restrictions, the employee and the employer can terminate the employment relationship at their own discretion, subject to certain dates and deadlines. No special reasons or the consent of the other contractual partner are required to terminate the employment relationship.
The termination date refers to the point in time at which the employment relationship is terminated.
| For employees | For employers |
|---|---|
| The last day of the month | The end of the quarter, though a contractual agreement for the 15th or last day of the month is permissible |
Do note that the parties to the employment contract can mutually agree at any time to end the employment relationship. Whether an agreement has been reached must be assessed on a case-by-case basis. In principle, no formal requirements need to be observed.
Notice Period
The notice period for employees is generally set at 1 month, while those set for employers go as follows:
| Length of service | Notice period |
|---|---|
| Up to 2 years | 6 weeks |
| 3–5 years | 2 months |
| 6–15 years | 3 months |
| 16–25 years | 4 months |
| Over 25 years | 5 months |
The notice period for employees can be extended by up to 6 months by agreement. However, the employer's notice period cannot be shorter.
An immediate termination without notice can be executed by either the employee or the employer through a unilateral declaration of intent that requires receipt. For dismissals, they must be announced immediately after the reason for dismissal becomes known.
The reasons justifying summary termination must be so serious that, objectively speaking, continued employment is unreasonable for the employee, even for the duration of the statutory or agreed notice period.
Note: Reasons that justify summary termination are listed as examples under the Employees Act (AngG).
Severance Pay
The responsibility for employers' severance pay obligations has been transferred to the Employee Pension Fund (BV). Employers must pay a monthly contribution of 1.53% of the employee's monthly salary, including any special payments, to the selected BV fund.
Probationary Period
A probationary period can generally only be agreed at the beginning of an employment relationship, and they may not be longer than a month.
During the probationary period, both the employer and the employee can terminate the employment relationship at any time and without giving reasons.
Work Time Rules
Standard Working Hours
Normal working hours in Austria are subject to a maximum of 8 hours per day and 40 hours per week.
The employer may adopt alternative distributions of working hours by means of a collective agreement or an individual agreement, or if the nature of the work justifies such an arrangement.
Break Period
If the total duration of the daily working time is more than 6 hours, the working time must be interrupted by a break period of at least 30 minutes. This break period shall not be counted as part of the employee's working hours.
An employee's rest break can be divided into 2 parts of 15 minutes each or into 3 parts of 10 minutes each if it is in their interest or it is necessary for operational reasons.
In addition to the above, nursing mothers may also be entitled to the following breastfeeding break:
| Working hours | Breastfeeding break |
|---|---|
| More than 4.5 hours per day | 45 minutes |
| 8 or more hours per day | 90 minutes, which can be split into 2 equal parts of 45 minutes each |
The time taken by the employee for breastfeeding purposes shall not lead to any loss of earnings. Furthermore, this time may not be taken before or after work, nor may it be counted towards statutory rest periods.
Overtime
Overtime occurs when the daily or weekly normal working hours are exceeded. Employees may only be required to work overtime if this is permitted under the provisions of the Working Hours Act and if the employee's interests do not conflict with the overtime work.
| Overtime due to higher demand for work | Overtime to carry out preparatory and final work |
|---|---|
|
If there is an increased need for work, the average weekly working time may not exceed 48 hours within an averaging period of 17 weeks. However, no more than 20 hours of overtime are permitted per week, and daily working time shall not exceed 12 hours. Employees are free to refuse overtime without giving reasons if the overtime means that their working hours will exceed 10 hours per day or 50 hours per week. |
The duration of working time permitted for the establishment or a department of the establishment may be extended by 30 minutes, but not more than 12 hours per day for preparatory and final work that cannot be carried out during regular operation without interruption or significant disruption.
|
In any case, total working hours, inclusive of overtime, shall not exceed 12 hours per day and 60 hours per week, unless certain conditions for exceptions are met.
Employees required to work overtime shall be paid a 50% surcharge or be compensated with an equivalent time off.
Weekly Rest Days
Employees shall be entitled to at least 11 consecutive hours of rest after completing a workday and at least 36 consecutive hours of rest per week.
As a rule, the entire Sunday must fall within the employee's weekly rest period. Only if weekend work is permitted under certain legal conditions can the weekly rest period include another whole weekday.
If necessary for operational reasons, exceptions to the weekly rest provisions may be permitted by regulation for certain types or certain groups of establishments or, in individual cases, by authorization from the Labor Inspectorate.
Employees required to work during their rest period are entitled to paid compensatory rest in the following working week.
Holiday and Leave Entitlements
Public Holidays
Employees are entitled to an uninterrupted paid rest period of at least 24 hours on public holidays that falls on their regular working days. There are 13 days of public holidays in Austria for 2025.
| Holiday | Date |
|---|---|
| New Year's Day | January 1 |
| Epiphany | January 6 |
| Easter Monday | April 21 |
| Labor Day | May 1 |
| Ascension of Christ | May 29 |
| Whit Monday | June 9 |
| Corpus Christi | June 19 |
| Assumption of Mary | August 15 |
| National Day | October 26 |
| All Saints Day | November 1 |
| Immaculate Conception | December 8 |
| Christmas Day | December 25 |
| St. Stephen's Day | December 26 |
Employees may only be required to work on public holidays if it is permitted under certain legal conditions, and they must be paid for the work performed on top of the amount they are entitled to for the paid holiday.
In addition to the above, employees have the opportunity to take a day off without the agreement of their employer on a day that is important to them, i.e. a personal holiday. This day must be announced at least 3 months in advance.
For example, members of the Evangelical Methodist Church, for whom Good Friday was previously a public holiday, can continue to take this day off.
If the employer requests that the employee work on the chosen day anyway, the employee can refuse this request. However, if they agree to this request, they are entitled to the remuneration for the work performed on that day in addition to the holiday pay, i.e. double the pay in total.
Annual Leave
Employees shall be entitled to a total of 5 calendar weeks of paid annual leave for each year of work.
| Annual leave | |
|---|---|
| Employees working 6-day workweek | 30 working days |
| Employees working 5-day workweek | 25 working days |
Those who have worked for the same company for more than 25 years are entitled to a total of 6 calendar weeks of paid annual leave.
An employee's annual leave entitlement arises in the first half of the first working year on a pro rata basis. After 6 months of service, the holiday entitlement arises in full in the first working year. From the second working year onwards, the employee shall be entitled to all of their leave from the start of the working year.
Annual leave may only be split once, whereby one part of the leave must at least be a week. The employee should use theIR annual leave entitlement by the end of the year in which it is accrued, if possible.
Any remaining leave not used in the current leave year will automatically be carried over to the following vacation years without the need for any agreement, as long as it has not expired. Annual leave entitlement expires after 2 years from the end of the year in which it arose.
Sick Leave
Employees who are unable to work due to a sickness or an accident shall be entitled to 6 weeks of paid sick leave per year, provided that their incapacity is not intentional or due to gross negligence. This entitlement increases to up to 12 weeks depending on the length of the employment relationship.
| Length of service | Duration of sick leave with full pay |
|---|---|
| 1–14 years | 8 weeks per year |
| 15–24 years | 10 weeks per year |
| 25 years and over | 12 weeks per year |
After the period of sick leave with full pay has been exhausted, the employee retains the right to half their salary for a further 4 weeks.
If the employer has exhausted the continued payment of wages, the employee may be entitled to sickness benefit from social insurance.
| Employees' reporting obligation | Employers' reporting obligation |
|---|---|
| Employees must inform their employer immediately without undue delay if they are unable to work due to a sickness or an accident. | Employers must issue a confirmation of employment and remuneration and send it to the responsible health insurance provider so that employees can receive sick pay from social insurance. |
Maternity Leave
Pregnant employees shall be entitled to 8 weeks of pre-natal leave and 8 weeks of post-natal leave. In the case of multiple births, premature births or a Caesarean section, the post-natal leave increases to 12 weeks.
| Pre-mature childbirth | Late childbirth | Stillbirth |
|---|---|---|
| The days between the actual and the calculated birth date are counted towards the 8- or 12-week post-natal leave period. In any case, however, the leave shall end no later than 16 weeks after birth. | The pre-natal leave shall be extended to the extent that the birth occurs later than stated in the certificate. | This occurs when there are no signs of life and the birth weight is at least 500 grams. The post-natal leave period lasts just as long as for a live birth, i.e. between 8 and 16 weeks. |
Employees on maternity leave may be entitled to receive financial support, including childcare allowance, family allowance and other grants and subsidies.
| Employees' reporting obligation | Employers' reporting obligation |
|---|---|
|
In the event of pregnancy, the employee must inform the employer of their pregnancy and the expected date of birth immediately after they become aware of it. A medical certificate may be requested by the employer. This must be done within the 4th week before the start of the protection period. |
Employers are obligated to inform the competent labor inspectorate in writing of the existence of an employee's pregnancy and other relevant information. A copy of this report must be given to the employee, along with the issuance of a work and salary confirmation for the claim of maternity allowance. |
| In the event of premature termination of the pregnancy, the employee must inform the employee of such fact. | The employer must also inform the head of occupational health care, if available. |
Paternity Leave
Working fathers shall be entitled to a month of unpaid paternity leave, which can be taken from the day following childbirth until the end of the mother's maternity leave.
If the mother is not entitled to any maternity leave, i.e. self-employed or unemployed, the paternity leave can be taken up to 8 weeks after childbirth or 12 weeks in the case of premature births, multiple births or Caesarean sections.
| Reporting obligations | Conditions to take paternity leave |
|---|---|
|
Employees must generally inform the employer at least 3 months before the expected date of birth that they wish to take paternity leave. The date of birth and the expected start of the leave must also be stated. Moreover, they must also inform the employer immediately of the child's birth and announce the start date of the leave no later than a week after the birth. |
The conditions for taking paternity leave include the existence of a shared household between the father and the child, the timely advance notice and the timely notification of the actual start of the paternity leave |
Parental Leave
Employees may be entitled to take unpaid parental leave that each lasts for at least 2 months, which can be taken by a single parent or by both parents.
If only a parent takes parental leave, the leave can last until the child is 22 months old. On the other hand, if both parents take turns taking parental leave, the leave can last until the child is 2 years old at the latest.
| Simultaneous use | Single parents | Parents where one parent is not entitled to parental leave |
|---|---|---|
| If both parents take parental leave alternately and take a month at the same time, the leave can last until the child is 23 months old at the latest. | A parent alone can take parental leave until the child's second birthday if the other parent does not live with the child in the same household or is not present. | If the parent who initially cares for the child is not entitled to parental leave and the other parent takes parental leave at the earliest after 2 months from the earliest possible start of parental leave, the parental leave entitlement is extended until the end of the 24th month of the child's life. |
The leave can be split twice between the parents, which means that a total of 3 leave periods are permitted, e.g. mother/father/mother, with each period having to last at least 2 months.
The mother must notify the employer of any parental leave following their maternity leave within this period, and the father must notify the employer no later than 8 weeks after childbirth.
| Circumstances | Reporting obligations |
|---|---|
| If the parent who initially looks after the child is not entitled to parental leave and the employed parent takes parental leave at a later date | The employee must give notice of the parental leave at least 3 months before it begins, with the employer providing their employees with a confirmation of the start and duration of the parental leave. |
| If the employee split the leave between the parents | The employer must be notified of the second and third parts of the leave at least 3 months before they begin. If the current part of the leave is less than 3 months, the next part of the leave does not have to be notified until 2 months before it begins. |
Note: Parental leave can be extended once per parent and child. The employee can inform their employer that they are extending the leave and for how long 3 months before the end of the reported leave.
Other Leave
| Leave | Paid/Unpaid | Duration | Note |
|---|---|---|---|
| Child Rehabilitation Leave | Unpaid | 4 weeks per year per child |
Employees can take this leave to accompany their child during their inpatient rehabilitation stay, provided that they have not completed their 14th year of life. Employees must submit the approval of the rehabilitation by the social insurance institution to the employer no later than a week after receipt of said approval. |
| Educational Leave | Unpaid | - |
For employees to attend training programs to improve their efficiency in their professional lives. During the leave, the employer does not have to pay any contributions to the company pension scheme. Those who are on educational leave must be de-registered by the employer and only re-registered after they return to work. |
| General Care Leave | Paid | Employee's weekly working hours per year |
Employees can take this leave to take necessary care of sick child, close relative or person living in the same household. This leave can be taken on a daily or hourly basis. Employees must inform their employers immediately if they are taking this leave. |
| Extended Care Leave | Unpaid | 1 working week per year |
If the general care leave has been used up, the employee can take this extended leave to take necessary care of a sick child under 12 years old and lives in the same household. If this extended leave has also been exhausted, the employee can further extend their leave by using their annual leave entitlement or come to an agreement with their employer for a separate care leave arrangement. |
| Family Hospice Leave | Unpaid | 3–9 months per case |
For employees to accompany dying relatives (3–6 months per case) and their seriously ill children (5–9 months per case), provided that the employer are informed in writing. For this purpose, the employee shall also have the right to reduce or change their working hours. |
| Military Service Leave | Unpaid | - | For employees who have been called for on-site military service |
| Personal Leave | Paid | 1 week |
Employees may be entitled to take leave for personal reasons, including for their marriage, death of a relative, relocation and summons to authorities, among others. These are usually regulated in the relevant collective agreements. |
Also see: Paid leave for major disaster and mountain rescue operations
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