Companies extending their operations into Austria need a complete grasp of Austrian employment contracts. A successful business largely depends on its employees. By creating work contracts that include the right terms and benefits there will be no misconception and the perfect work-life balance can be created for your workforce.

Thanks to our Professional Employment Organisation (PEO) and Employer Of Record (EOR) services, we can provide compliant labour contracts for your employees in Austria, including local benefits. Our team keeps track of Austrian laws and regulations daily to be duly aware of updates that can be implemented in working contracts and to ensure a smooth entry for your business into the Austrian economy.

The different types of Austrian Employment Contracts

The General Civil Code (ABGB) defines the structure of employment contracts (Dienstvertrag) with the Employment Contracts Act (AVRAG). Although there is no legal requirement for employees to be given a written agreement, they are commonly in force and strongly recommended. Without a formal written contract, employees must at least be given a written statement covering the essential elements of the job. This should include full names and address details of the employer’s business and the name and address of the employee; start date with end date if it is a fixed-term agreement; job description; salary and payment schedule; working hours, breaks and paid vacations.

Permanent, open-ended or indefinite employment contracts: These are the norm, ended by retirement, resignation or termination following the correct procedures.

Fixed-term employment contracts are for a specified time, although there is no statutory restriction on their length. Where a contract exceeds five years, the employee has the right to terminate with six months’ notice. If arrangements are renewed without objective justification, they can become open-ended.

Probation periods: These can be up to one month, as stipulated by the contract, written agreement or a Collective Bargaining Agreement. During the trial period, either party can terminate without reason.

Collective Bargaining Agreements (CBAs): Industry-wide CBAs are a significant factor in Austria, overriding any agreements at the company or factory level and covering virtually all employees by law. Where CBAs exceed statutory minimums to benefit employees, they always take precedence. Austria has strong cooperation between trade unions, the state and employers’ Economic Chambers (WKO), to which all employers are required to belong

Austrian Employment Contracts Requirements

Employment legislation in Austria is mainly governed at the federal level, with the General Civil Code (ABGB) supplemented by a large selection of individual statutes dealing with specific areas of employment. Additionally, Austria’s membership of the European Union brings EU directives into play, with industry-level Collective Bargaining Agreements (CBAs) providing comprehensive coverage for most of the workforce.

To a reduced extent, in some sectors, legislation distinguishes between white-collar salaried employees with the White-Collar Employees’ Act (Angestelltengesetz) and blue-collar workers (Arbeiter), who can be regulated by the Trade Ordinance (GewO). The differences in treatment of the two sectors were abolished by law in 2018, and the distinction has significantly decreased being a factor.

General requirements applying to all Austrian contracts include:

  • Employment contracts are not legally required under the Labour Contract Law (AVRAG), but they are commonly in force and strongly recommended
  • Employees must at least be given written details of the agreement, including full title and address details of the employer’s business; start date with end date if it is a fixed-term agreement; job description; salary and payment schedule; working hours, breaks and paid vacations.
  • Employers must comply with legally binding Collective Bargaining Agreements (CBAs)
  • Probation periods can be entered into the first month of employment
  • There is no time limit on fixed-term contracts or the number of fixed-term agreements before which the employment is deemed open-ended and permanent. However, if there is no reasonable justification for their renewal, they could be considered to as becoming permanent
  • Although there is no statutory requirement for written contracts, they are advisable and should be in a language understood by the employee. The contract should confirm that the German version prevails in a dual-language agreement (German plus one other).


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