Hire Employees in Austria

Your own entity is normally a GmbH. Registration is manageable, but membership of the Wirtschaftskammer is compulsory for businesses, which means the applicable collective agreement follows automatically from your activity rather than from any choice you make.

An Employer of Record inverts the sequence: the Austrian entity signs the contract, registers with the ÖGK before the employee starts, applies the correct Kollektivvertrag scale and administers the fourteen-salary cycle — while you direct the day-to-day work.

Austria has hundreds of collective agreements setting binding minimum pay by role and seniority, and identifying the right one is a judgement a local operator makes routinely and a foreign employer usually gets wrong once.

Austria pays fourteen salaries, not twelve, and that is the first thing to fix in any cost model. The Urlaubsgeld and Weihnachtsgeld — holiday and Christmas payments — are set by collective agreement rather than statute, but coverage is close to universal, so in practice they are mandatory. They are taxed favourably as Sonderzahlungen, at 6% above a tax-free band, which makes them efficient for the employee and unavoidable for the employer.

Employer social insurance is around 20.98% up to the Höchstbeitragsgrundlage of €6,930 a month for 2026, plus roughly 3.7% for the Family Burden Equalisation Fund, 3% municipal tax and 1.53% to the Abfertigung neu severance fund. Total employer cost lands near 29–30% of a fourteen-month salary.

The Kollektivvertrag is the other reason to use a local operator early. Austria has hundreds of them, they set binding minimum pay by role and seniority, and membership of the Wirtschaftskammer is compulsory for businesses — which means the applicable agreement follows automatically from the company's activity rather than from any choice you make.

Abfertigung neu is worth understanding as a feature rather than a cost. Since 2003 the employer pays 1.53% monthly into a severance fund, and the accrued balance follows the employee between jobs. It replaced the old lump-sum entitlement, so an Austrian exit is far more predictable than the headline suggests.

Break-even rule of thumb: EOR fees begin to exceed the running cost of a small Austrian entity somewhere between 15 and 20 employees. Model both before committing — see EOR vs Entity for the full comparison, and plan any later migration so employees keep seniority.

Austria pays fourteen salaries, not twelve, and that is the first correction to any inherited cost model. The Urlaubsgeld and Weihnachtsgeld are set by collective agreement rather than statute, but coverage is close to universal so in practice they are mandatory.

They are also tax-efficient: taxed as Sonderzahlungen at 6% above a tax-free band, which makes them considerably better value to the employee than an equivalent increase in monthly salary.

Employer social insurance is around 20.98% up to the Höchstbeitragsgrundlage of €6,930 a month for 2026, plus roughly 3.7% for the Family Burden Equalisation Fund, 3% municipal tax and 1.53% to the Abfertigung neu severance fund — a total near 29–30% of a fourteen-month salary.

There are two ceilings, not one, and that matters because Austria pays fourteen salaries. Ordinary monthly pay caps at €6,930 for 2026, up from €6,450. The Sonderzahlungen have a separate annual ceiling of €13,860, up from €12,900. Applying only the monthly figure misstates the position on the two extra months.

Four representative profiles, costed with the 2026 contribution rates above. Salaries are illustrative market midpoints, not GX operating data — use them to see how the on-cost percentage behaves as pay rises, not as a salary benchmark for a specific role. For real market data on your roles, ask for a costing.

Watch the on-cost percentage rather than the absolute figure. 8 of the charges here are capped and 4 are not, so the effective employer rate falls as salary rises — but it flattens rather than disappearing. The senior rows below show where it settles.

Four representative profiles costed on 2026 statutory rates. Salaries are illustrative market midpoints, not GX operating data.

Payroll runs monthly in euros, with the two Sonderzahlungen typically paid in June and November. Contributions are remitted to the ÖGK monthly.

Abfertigung neu is worth understanding as a feature rather than a cost. Since 2003 the employer pays 1.53% monthly into a severance fund and the accrued balance follows the employee between jobs. It replaced the old lump-sum entitlement, so an Austrian exit is far more predictable than the headline rate suggests — there is no severance payment at termination for service after 2003.

Municipal tax is due in each municipality where employees work, which matters for distributed teams: a company with staff in three municipalities files in three.

Thresholds and ceilings are uprated periodically, so a figure correct in January may not hold later in the year. Where a row below is flagged, published sources disagreed and the conflict is recorded rather than resolved.

Thresholds move on a local cycle that does not always fall in January, so a figure correct at the start of the year may not hold through it. Where a row below carries a flag, published sources disagreed and the conflict is recorded rather than resolved — there are 2 such rows on this page.

The sections that follow set out contracts and probation, working time, leave, termination and immigration in that order. Where an entitlement comes from a collective agreement rather than statute it is marked as such, because that distinction determines whether it is negotiable.

A written Dienstzettel setting out the essential terms must be provided, and the applicable collective agreement determines the pay scale for the role and seniority band.

ÖGK registration must be completed before the employee starts work, not on the first day. Late registration attracts penalties and is one of the most frequently sanctioned failures in Austrian payroll.

Probation is one month for most employment relationships, during which either party may terminate without notice or reason. That is short by European standards and makes the first month a genuine assessment window rather than a formality.

Forty hours a week under statute, though most collective agreements set 38 or 38.5. The daily maximum is 12 hours and the weekly maximum 60, with an average of 48 over 17 weeks. Overtime attracts a 50% premium, rising to 100% for night, Sunday and public holiday work.

Overtime is where payroll disputes usually start. Record hours from day one even where the role is salaried and the expectation is that overtime will not arise — reconstructing records after a complaint is far harder than keeping them.

Overtime is where payroll disputes usually begin, and the burden of proving hours worked generally sits with the employer. Record hours from the first day even for salaried roles where overtime is not expected — reconstructing a record after a complaint is considerably harder than keeping one.

Public holidays sit on top of the annual leave entitlement. Where a holiday falls at a weekend, practice varies — some markets move it, some grant a substitute day and some do neither, so check the position before assuming a day in lieu.

The 13 dates below are the statutory position. Employers in many markets grant more by policy or collective agreement, and sector agreements sometimes add local or patronal days that do not appear in a national list.

Austria observes 13 paid public holidays in 2026. Dates that fall at a weekend and any substitution rules are set out below; entitlement is separate from annual leave.

Maternity protection (Mutterschutz): 8 weeks before and 8 weeks after the birth — an absolute prohibition on working — Wochengeld from health insurance, not the employer. Parental leave (Karenz): Until the child’s second birthday, if at least two months are taken by the other parent — Childcare allowance from the state; job protected. Papamonat: 1 month within the protection period after the birth — Family time bonus from the state. Sick leave: 6 to 12 weeks at full pay by length of service, then 4 weeks at half pay — Employer-paid, then health insurance.

Care leave (Pflegefreistellung): 1 to 2 weeks a year — Full pay, employer-funded.

Austrian notice for white-collar employees is set by statute and rises from six weeks in the first two years to five months beyond twenty-five. Employer notice must generally end on a quarter day — 31 March, 30 June, 30 September or 31 December — unless the contract permits the fifteenth or the end of any month. That single rule extends many terminations by weeks and is routinely missed by foreign employers.

Since the 2021 harmonisation, blue-collar notice follows the same statutory scale, though sector collective agreements may vary it.

Severance comes from the Abfertigung neu fund rather than directly from the employer, so no lump sum falls due at termination for service after 2003. Employees with pre-2003 service may retain the old entitlement, which is employer-funded and can be substantial — worth checking for any long-tenured hire.

Dismissal may be challenged as socially unjustified where the employee has been employed for at least six months and the works council has been informed. The works council must be notified before notice is given.

EU, EEA and Swiss nationals need no permit. A third-country national needs a Rot-Weiß-Rot Karte, which is points-based across qualifications, experience, language and age.

Allow two to three months. The card is tied to the employer for the first two years, after which the Rot-Weiß-Rot Karte plus permits unrestricted labour market access.

Austria assesses the offered salary against the applicable collective agreement rather than a standalone threshold, so an offer below the Kollektivvertrag scale will fail the application regardless of how it compares to market.

A cross-border hire may not attract local contributions at all. Under EU Regulations 883/2004 and 987/2009 a worker moving within the EEA is subject to one state’s social security system at a time. A posted worker stays in the home system for up to 24 months under Article 12, and someone working across two or more states follows a single state determined by a 25% activity test under Article 13. Where a valid A1 portable document is held, the host state cannot charge contributions. The certificate is declaratory rather than constitutive — the right legislation applies either way — but without it a host state can assess retroactively with penalties, and enforcement is aggressive in France, Belgium and Austria. Residual local charges are not always nil, so confirm the specific position rather than assuming zero.

Employer notice must generally end on a quarter day — 31 March, 30 June, 30 September or 31 December — unless the contract permits the fifteenth or the end of any month. That single rule extends many terminations by weeks and is routinely missed by foreign employers planning an exit date.

The works council must be notified before notice is given where one exists, and dismissal may be challenged as socially unjustified for employees with at least six months of service.

Practical controls: register with the ÖGK before the start date, identify the Kollektivvertrag and its scale before making an offer, budget fourteen payments rather than twelve, check whether the contract permits month-end notice, and register for municipal tax in every municipality where employees work.

Work backwards from the start date. For an EU national, a week or two is realistic. A third-country national needs a Rot-Weiß-Rot Karte, which is points-based and adds two to three months.

Confirm before making an offer: which Kollektivvertrag applies and what minimum it sets for the role and seniority band, since that is binding; whether the notice regime can end on any month-end or is restricted to quarter days; and that the budget reflects fourteen payments rather than twelve.

ÖGK registration must be completed before the employee starts work, not on the first day. Late registration attracts penalties and is one of the most frequently penalised failures in Austrian payroll. Municipal tax registration is required in each municipality where employees work, which matters for distributed teams.