Employer of Record in Austria

Hire employees in Austria through an Employer of Record (EOR) without setting up a local entity. This comprehensive guide explains Austria's labour laws, payroll, taxes, benefits, and compliance requirements so you can build a compliant Austria workforce with confidence.

What is an Employer of Record in Austria?

An Employer of Record in Austria is a third-party organisation that legally employs workers on behalf of foreign companies. The EOR takes full legal responsibility for the employment relationship under Austrian law, while the client company directs the employee's daily work and performance.

This arrangement allows international businesses to hire Austria professionals quickly and compliantly without establishing a local entity. It is particularly useful for startups, growing businesses, and enterprises exploring the Austria market for the first time. The EOR manages all employment obligations, including contracts, payroll, tax filings, social contributions, benefits, and ongoing compliance with local labour laws.

Why Hire in Austria?

Austria offers international employers access to one of Europe's most stable, prosperous, and highly skilled labour markets. As a founding member of the EU and a Eurozone economy, Austria combines strong industrial output, an outstanding education system, and a strategic location at the gateway between Western Europe and the CEE region.

Austrian professionals are known for their technical excellence, particularly in engineering, manufacturing, IT, and pharmaceuticals. English proficiency is high, and German fluency provides a natural bridge to Germany, Switzerland, and the wider DACH region. Vienna consistently ranks among the world's most liveable cities, helping employers attract and retain international talent.

Austria operates a highly structured labour environment shaped by sector-specific collective bargaining agreements covering 98% of the workforce. While total employer costs are higher than the EU average — typically 29–30% above gross salary — productivity, predictability, and access to a skilled workforce make it a long-term strategic location for international companies.

What Are the Quick Facts About Austria?

Before hiring in Austria, it helps to understand the basic country profile at a glance.

What Are the Employment Laws in Austria?

Employment relationships in Austria are primarily governed by the Austrian Labour Constitution Act (ArbVG), the General Civil Code (ABGB), the Salaried Employees Act (AngG), and over 800 sector-specific collective bargaining agreements (Kollektivverträge). This legislation regulates every aspect of the employment relationship, including contracts, working hours, leave entitlements, termination procedures, and workplace rights.

Written employment contracts are mandatory in Austria and must be drafted in German. Every contract must specify the job description, salary, working hours, probation period, benefits, and termination terms. Both fixed-term and indefinite-term contracts are permitted under Austria's law. Fixed-term contracts cannot exceed objectively justified consecutive renewals (chains of fixed-term contracts may be reclassified as permanent), including any renewals.

The standard probation period for most roles is capped at one month (three months for apprenticeships). During probation, either the employer or the employee may terminate the relationship with shortened notice as specified by law or the employment contract.

What Are the Working Hours and Overtime Rules in Austria?

The standard workweek in Austria is 40 hours (8 hours/day, 5 days) — many sectoral CBAs reduce this to 38.5 hours. The maximum weekly working time, including overtime, is 48 hours on average over 17 weeks (with peaks to 60 hours). Rest periods and overtime premiums are also regulated by law.

What Leave Entitlements Apply in Austria?

Austria employees enjoy comprehensive leave entitlements, including annual leave, public holidays, sick leave, maternity leave, and paternity leave.

Public Holidays Observed: New Year's Day, Epiphany, Easter Monday, Labour Day, Ascension Day, Whit Monday, Corpus Christi, Assumption of Mary, National Day (26 October), All Saints' Day, Immaculate Conception, Christmas Day, and Saint Stephen's Day.

What Is the Minimum Wage and Average Salary in Austria?

Austria has no statutory national minimum wage. Instead, minimum pay is set by more than 800 sector-specific collective bargaining agreements (Kollektivverträge), which cover roughly 98% of the workforce. Most entry-level minimums fall between €1,800 and €2,000 gross per month, paid 14 times per year due to the mandatory 13th and 14th salary payments. Average gross monthly salaries are around €3,800–€4,000 in early 2026.

Salaries are paid monthly through bank transfer in Euros, typically by the end of each month, with the annual salary divided into 14 equal payments. 13th and 14th salary payments are virtually universal in Austria due to collective bargaining agreements, paid as 'Urlaubsgeld' (holiday bonus) in June and 'Weihnachtsgeld' (Christmas bonus) in November. These are taxed at a reduced 6% rate (with the first €620 tax-free), making them highly tax-efficient for both employer and employee.

How Do Taxes and Social Contributions Work in Austria?

Austria requires both employers and employees to contribute to social security, and personal income tax is withheld at source by the employer.

Employee Income Tax

Social Security and Health Contributions

Note: Contributions are calculated on gross salary up to a statutory ceiling where applicable. Rates are reviewed periodically.

What Are the Mandatory Employee Benefits in Austria?

All employees in Austria are entitled to statutory benefits under the labour code, and many employers add supplementary benefits to attract top talent.

How Do Termination and Severance Work in Austria?

Termination rules in Austria depend on the employee's tenure. The labour code strictly defines notice periods and severance pay.

Notice Periods by Tenure

Severance Pay

Legal Grounds for Termination

Employment in Austria can be terminated by mutual agreement, voluntary resignation, the natural expiration of a fixed-term contract, just cause due to serious misconduct, or economic and organisational reasons, with proper notice.

Protected Categories

Austria labour law offers special protection against termination for pregnant employees, employees on maternity or paternity leave, employees on sick leave, and trade union representatives.

What Are the Work Permit and Visa Requirements in Austria?

Foreign nationals who are not EU, EEA, or Swiss citizens generally require a residence and work title (Aufenthaltstitel) to work legally in Austria. The most common route for skilled workers is the Red-White-Red Card, a points-based permit valid for 24 months with a minimum salary of €3,465 gross per month from January 2026. Highly qualified graduates may opt for the EU Blue Card at approximately €55,678 per year.

Processing typically takes between 4 and 12 weeks, depending on permit type and supporting documentation, depending on documentation and administrative workload. Citizens of EU and EEA member states and Switzerland have full access to the Austrian labour market without a work permit and may take up employment immediately. Registration with the local registration office is required if the stay exceeds 3 months.

How Do You Hire in Austria Through an EOR?

The hiring process through an Employer of Record typically follows five clear stages, from candidate selection to ongoing compliance management.

Should You Set Up a Local Entity in Austria Instead?

For companies with significant long-term investment plans in Austria, establishing a local entity may be a viable alternative to using an EOR.

Setting up a GmbH in Austria typically takes four to eight weeks. The minimum share capital is €10,000 (with €5,000 paid up at incorporation), reduced from the previous €35,000 threshold for the founder-friendly 'FlexCo' variant. Registration involves notarisation, commercial register filing, and tax registration. For companies planning to hire fewer than 10 employees, using an EOR is generally faster, more cost-effective, and avoids the ongoing administrative burden of Austrian corporate compliance.

EOR vs Local Entity vs Contractor — Which Is Right for You?

Comparing the three main hiring models helps you choose the right approach for your Austria workforce.

What Common Hiring Mistakes Should You Avoid in Austria?

Companies new to hiring in Austria often encounter several common pitfalls. Misclassifying employees as independent contractors is a significant risk, as Austria has clear legal distinctions between the two, and reclassification can lead to penalties and back payments.

Failing to issue written employment contracts in German is another frequent error, as verbal or foreign-language agreements may not be legally enforceable. Ignoring collective bargaining agreements in regulated sectors can lead to compliance issues, as can miscalculating social security contributions since rates and ceilings are periodically updated.

Skipping proper documentation of probation periods can inadvertently extend employee protections beyond what the employer intended. Finally, providing inadequate notice of termination or failing to follow proper dismissal procedures can expose companies to compensation claims and legal disputes.

Which Industries Are Hiring Most in Austria?

Several key industries drive Austria's labour market, each offering a distinct talent pool for international employers.

Are you an Employer of Record (EOR) provider looking to expand your reach in Austria?

We help EOR companies increase their visibility and generate real business opportunities by featuring them on our platform through:

• Company listings
• Dedicated SEO-optimised articles
• Sponsored content & brand features
• Austria-focused landing pages
• Social media promotion targeting regional and international audiences

Our audience includes businesses, startups, and HR professionals actively exploring hiring solutions in Austria and Central Europe and the DACH region — giving your brand direct access to decision-makers ready to expand their teams.

By partnering with us, you can:

1. Position your company in Austria's growing hiring market
2. Connect with companies looking to hire local and international talent
3. Showcase your EOR services, compliance support, and expertise
4. Generate qualified leads from businesses entering the Austria market
5. Build trust and authority through targeted, high-quality content
6. Expand your presence in Central Europe and the DACH region and the wider region

Austria is becoming an attractive destination for global hiring — making it a strong opportunity for EOR providers.

Disclaimer

This guide is provided for educational and informational purposes only. Austria's labour laws, tax rates, and social contribution percentages are subject to change. Always consult a qualified Employer of Record provider, local legal counsel, or certified tax advisor before making hiring or employment decisions in Austria.