Definitive global law guides offering comparative analysis from top-ranked lawyers
CHAMBERS GLOBAL PRACTICE GUIDES
Employment 2025 Definitive global law guides offering comparative analysis from top-ranked lawyers
Contributing Editor Tobias Pusch Pusch Wahlig Workplace Law
Global Practice Guides
Employment Contributing Editor Tobias Pusch Pusch Wahlig Workplace Law
2025
Chambers Global Practice Guides For more than 20 years, Chambers Global Guides have ranked lawyers and law firms across the world. Chambers now offer clients a new series of Global Practice Guides, which contain practical guidance on doing legal business in key jurisdictions. We use our knowledge of the world’s best lawyers to select leading law firms in each jurisdiction to write the ‘Law & Practice’ sections. In addition, the ‘Trends & Developments’ sections analyse trends and developments in local legal markets. Disclaimer: The information in this guide is provided for general reference only, not as specific legal advice. Views expressed by the authors are not necessarily the views of the law firms in which they practise. For specific legal advice, a lawyer should be consulted. Content Management Director Claire Oxborrow Content Manager Jonathan Mendelowitz Senior Content Reviewers Sally McGonigal, Ethne Withers, Deborah Sinclair and Stephen Dinkeldein Content Reviewers Vivienne Button, Lawrence Garrett, Sean Marshall, Marianne Page, Heather Palomino and Adrian Ciechacki Content Coordination Manager Nancy Laidler Senior Content Coordinators Carla Cagnina and Delicia Tasinda Content Coordinator Hannah Leinmüller Head of Production Jasper John Production Coordinator Genevieve Sibayan
Published by Chambers and Partners 165 Fleet Street London EC4A 2AE Tel +44 20 7606 8844 Fax +44 20 7831 5662 Web www.chambers.com
Copyright © 2025 Chambers and Partners
Contents
INTRODUCTION Contributed by Tobias Pusch and Teresa Gabele, Pusch Wahlig Workplace Law p.6 AUSTRIA Law and Practice p.10 Contributed by Edthaler Leitner-Bommer Schmieder & Partner Rechtsanwälte GmbH
DRC Law and Practice p.180 Contributed by Liedekerke
FRANCE Law and Practice p.194 Contributed by Bredin Prat Trends and Developments p.210 Contributed by Bredin Prat
AZERBAIJAN Law and Practice p.26 Contributed by Caspian Legal Center Trends and Developments p.44 Contributed by Caspian Legal Center
GIBRALTAR Law and Practice p.216 Contributed by Ellul & Cruz GREECE Law and Practice p.229
BRAZIL Law and Practice p.50 Contributed by Tortoro, Madureira & Ragazzi Advogados
Contributed by POTAMITISVEKRIS Trends and Developments p.246 Contributed by Machas & Partners
BULGARIA Law and Practice p.62 Contributed by Penkova & Partners Law Firm Trends and Developments p.79 Contributed by Penkova & Partners Law Firm
INDIA Law and Practice p.254 Contributed by Khaitan & Co Trends and Developments p.267 Contributed by Shardul Amarchand Mangaldas & Co.
CANADA Law and Practice p.84 Contributed by Fasken
INDONESIA Law and Practice p.274 Contributed by ABNR Counsellors at Law
Trends and Developments p.102 Contributed by Baker McKenzie CHILE Law and Practice p.108 Contributed by SCR Abogados CHINA Law and Practice p.125 Contributed by King & Wood Mallesons Trends and Developments p.142 Contributed by King & Wood Mallesons
ISRAEL Law and Practice p.288
Contributed by Arnon, Tadmor-Levy Trends and Developments p.305 Contributed by Dafna Shmuelevich & Co ITALY Law and Practice p.313 Contributed by Zambelli & Partners JAPAN Trends and Developments p.331 Contributed by AI-EI Law Firm MALTA Law and Practice p.338 Contributed by Fenech & Fenech Advocates
DENMARK Law and Practice p.150 Contributed by Bech-Bruun
DOMINICAN REPUBLIC Law and Practice p.166 Contributed by Hernández Contreras & Herrera
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Contents
MEXICO Law and Practice p.355 Contributed by Cannizzo, Ortiz y Asociados, S.C.
SINGAPORE Law and Practice p.515
Contributed by Drew & Napier LLC Trends and Developments p.534 Contributed by TSMP Law Corporation SLOVENIA Law and Practice p.541 Contributed by PFP Law Trends and Developments p.561 Contributed by PFP Law
NETHERLANDS Law and Practice p.372
Contributed by Rutgers & Posch Trends and Developments p.388 Contributed by Rutgers & Posch NIGERIA Law and Practice p.395 Contributed by Bloomfield LP Trends and Developments p.409 Contributed by ǼLEX
SOUTH KOREA Law and Practice p.567
Contributed by Yoon & Yang LLC Trends and Developments p.586 Contributed by Lee & Ko
NORWAY Trends and Developments p.415 Contributed by Ræder Bing Advokatfirma AS
SPAIN Law and Practice p.589 Contributed by A&O Shearman Trends and Developments p.609 Contributed by Eversheds Sutherland Spain SWEDEN Law and Practice p.617 Contributed by Advokatfirman Cederquist KB
PHILIPPINES Law and Practice p.422
Contributed by Villaraza & Angangco Trends and Developments p.441 Contributed by ACCRALAW POLAND Law and Practice p.447 Contributed by HRLS Zwolińska & Zwoliński
SWITZERLAND Law and Practice p.630 Contributed by Walder Wyss Trends and Developments p.647 Contributed by Walder Wyss
PORTUGAL Law and Practice p.464 Contributed by PLMJ
Trends and Developments p.475 Contributed by Eversheds Sutherland
TAIWAN Law and Practice p.654 Contributed by Dentons Taiwan (Dacheng Taiwan) THAILAND Law and Practice p.669 Contributed by Baker McKenzie (Bangkok) Trends and Developments p.682 Contributed by Baker McKenzie (Bangkok)
ROMANIA Law and Practice p.481 Contributed by Eversheds Sutherland Romania Trends and Developments p.495 Contributed by Eversheds Sutherland Romania
RWANDA Law and Practice p.501 Contributed by Liedekerke
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Contents
UK Law and Practice p.688
USA – NORTH CAROLINA Law and Practice p.765 Contributed by Nelson Mullins Riley & Scarborough LLP
Contributed by Slaughter and May Trends and Developments p.705 Contributed by Eversheds Sutherland USA Law and Practice p.711 Contributed by Ogletree Deakins USA – CALIFORNIA Law and Practice p.725 Contributed by Shook, Hardy & Bacon LLP USA – MASSACHUSETTS Trends and Developments p.736 Contributed by Shook, Hardy & Bacon LLP
USA – TEXAS Law and Practice p.780
Contributed by Bell Nunnally & Martin Trends and Developments p.795 Contributed by Bell Nunnally & Martin
ZIMBABWE Law and Practice p.801 Contributed by Wintertons
USA – NEBRASKA Law and Practice p.743
Contributed by Rembolt Ludtke LLP Trends and Developments p.760 Contributed by Rembolt Ludtke LLP
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INTRODUCTION
Contributed by: Tobias Pusch and Teresa Gabele, Pusch Wahlig Workplace Law
Pusch Wahlig Workplace Law is one of Germany’s leading employment law firms. A dedicated team of 70 employment specialists in six locations provides legal advice all over Germany. The practice has par - ticular experience in business restructuring, includ - ing mass workforce reductions, as well as reconcilia - tions and social plans. The law firm further advises on compliance, remuneration and works council matters and represents companies in employment litigation, as well as on the implementation of SE structures and
employment-related data protection. The mandates originate from a variety of sectors including financial services, technology, FMCG and many more, and the firm advises both large multinational corporations as well as prominent start-ups. As a member of L&E Global, Pusch Wahlig Workplace Law is one of the cornerstones of a leading global alliance of employ - ment law firms and regularly advises clients on cross- border matters.
Contributing Editor
Co-author
Tobias Pusch is the founder and managing partner of Pusch Wahlig Workplace Law. He advises national and international employers and executives on issues of individual and collective employment law. Tobias
Teresa Gabele is an associate partner at Pusch Wahlig Workplace Law
based in the Munich office. The scope of her practice includes all issues of individual and collective employment law. She is specialised in drafting employment contracts and termination agreements. In addition, Teresa has particular experience in matters regarding senior executives as well as extensive experience in immigration law, especially as it relates to access to the labour market for foreign employees and managers.
has particular experience in corporate acquisitions, restructuring, SE formations, compliance matters, complex court proceedings and negotiations regarding collective bargaining agreements and works agreements, as well as reconciliation of interests and social plans. His clients are DAX-listed and large multinational companies, prominent start-ups and mid-sized companies, as well as top executives. Known for sustainable and innovative solutions, Dr Tobias Pusch is one of Germany’s leading employment law specialists.
Pusch Wahlig Workplace Law Beisheim Centre Berliner Freiheit 2 10785 Berlin Germany
Tel: +49 (0) 3020 629 530 Fax: +49 (0) 3020 6295 399 Email: pusch@pwwl.de Web: www.pwwl.de
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INTRODUCTION Contributed by: Tobias Pusch and Teresa Gabele, Pusch Wahlig Workplace Law
Introduction The Chambers Employment Guide 2025 introduces employment law matters across 45 jurisdictions. The Guide contains the latest legal information from around the globe on the main changes in employment law that have been enacted or decided in the past year, general remarks on employment contracts and conditions, non-compete and non-solicitation claus - es, the data privacy law, the employment of foreign workers, “new work”, the role of unions, termination of employment, employment disputes and dispute resolution. Employment Law People are at the core of every company’s potential for added value. They manage the ongoing business and develop innovations for future progress and growth. This is why the key component for success in any organisation is how its people work together. The way in which this co-operation is achieved and the frame - work within which organisations can shape it is regu - lated by employment law. Due to the relationship of superiority and subordination between employer and employee, the employer enjoys a considerable advan - tage within this framework. Employment law therefore acts as a balance between the contractual freedom of the parties on the one hand and the protection of employees on the other. To further redress the disparity between employer and employee, most jurisdictions provide for collective employment law in addition to individual employment law. Individual employment law deals with the legal relationship between the employer and the employee, while collective employment law deals with matters between employers or their coalitions (employers’ associations) and trade unions or co-determination bodies (eg, works councils). Further peculiarities arise in the event of disputes. In employment law, the economic interests of the par - ties are particularly important. Employers pursue eco - nomically calculated goals; employees rely on their employment relationship for their livelihood. In prac - tice, this often requires quick, pragmatic and interest- driven solutions. More than in almost any other field of law, negotiation skills are indispensable in order to
succeed in employment law and cannot be replaced by mere legal expertise. Global Employment Law Employment law is primarily national law – the scope of application of employment laws is determined by national boundaries. This leads to different practical implementations and regulations in different countries. One advantage of this is that the states concerned can individually adapt regulations to their requirements and structures. However, in a world where cross-border relationships, takeovers and international contracts have become common practice, this approach can also lead to difficulties, precisely because regulations are designed and applied individually by each country. It is therefore imperative for managers and HR staff not only to know the local employment law standards, but also to have a more general overview and to be aware of the standards in other countries. As an aftermath of the global COVID-19 crisis, com - panies recognised that there was less need than previously for a constant workforce in the office, and they became more receptive towards remote working arrangements. As a result, there has been a global trend towards more flexible working models. As employees strive to work flexibly around the globe, local employment laws are reaching their limits. At the same time, countries have been concerned with amending legislation to ensure the health and safety of employees taking advantage of these new possi - bilities. Current Developments Several current developments have influenced employment law globally in recent years and will con - tinue to do so in the future. Flexible work models Models such as working from home, mobile working, video conferences and desk sharing have been part of the modern world of work since the COVID-19 crisis at the latest. Along with new regulations come a variety of laws that aim to support a healthy work-life balance as the two areas become increasingly blurred. A good example can be found in Belgium, which has imple - mented a law which foresees the “right to disconnect from work”.
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INTRODUCTION Contributed by: Tobias Pusch and Teresa Gabele, Pusch Wahlig Workplace Law
Work–life balance Companies around the world are increasingly con - cerned with work–life balance as a non-monetary incentive in the competition for the best staff mem - bers. Many legislators are supporting this trend with regulations that make it easier to combine family and career, with a particular focus on combating the grow - ing shortage of skilled workers. In Europe, this has been driven mainly by the need to adopt EU direc - tives in national law. These include, for example, the right to paid birthday leave and parental leave in many EU member states, as well as regulations regarding part-time working models and provisions regarding remote working. Inflation crisis Rising inflation is also having a global impact. On top of significant financial losses during the COVID-19 cri - sis, a global slowdown in economic growth – driven in part by the Russia-Ukraine war and the global energy crisis as well as the COVID-19 aftermath – has caused a striking fall in real monthly wages in many countries. The cost of living has increased rapidly, with a particu - larly significant impact on low-income groups. While schemes such as short-time work compensa - tion and wage subsidies have largely protected wage levels from the effects of the pandemic, adequate adjustment of minimum wage rates could be an effec - tive tool to help maintain purchasing power and living standards in the current inflation crisis. Supply chains There are also developments regarding the fair treat - ment of staff in supply chains. The global aim is to improve the protection of human rights all the way along global supply chains. To meet this objective, the prohibition in particular of child labour and forced labour is to be enforced and controlled, as well as the prohibition of substances that are harmful to peo - ple and the environment. As early as June 2011, the Human Rights Council issued the UN Guiding Prin - ciples on Business and Human Rights. These princi - ples aim to address violations of human rights in the context of economic activities. In order to effectively implement these values and principles adopted by the UN, the German government, for example, is pushing for internationally comprehensive standards regard -
ing fair global supply and value chains with its own national legislation. The German Act on Corporate Due Diligence Obligations in Supply Chains ( Liefer- kettensorgfaltspflichtgesetz – LkSG) is the binding implementation of the UN Guiding Principles and came into force in January 2023. As of January 2024, the law was extended to cover companies with 1,000 or more employees (previously 3,000 or more), thereby significantly increasing the number of companies sub - ject to its obligations. Whistle-blower protection One of the most significant European and global developments has been the adoption of the Whistle - blowing Directive in national law by EU jurisdictions. Although most member states have now implemented the directive, many initially gave employers a period of grace in which to establish internal reporting pro - cesses, some of which will soon expire. Outside Europe, countries are also encouraging employees to report information on violations of laws or regulations they become aware of at work. In Singa - pore, for example, the Ministry of Manpower recently took steps to raise awareness of the various channels through which workers can report health and safety problems at work, and to provide legal protection for workers who raise concerns. Transparency Global developments in the area of transparency – particularly pay transparency – are likely to continue since the entry into force of the EU Pay Transparency Directive in April 2023. Member states have three years to implement the directive into national law, which will lead to significant changes for many mem - ber states. However, the current status is that only Belgium implemented the Directive, a few member states published draft laws, whilst most other coun - tries (including Germany) are still in the preparatory phase. There have also been developments in this area outside Europe, including in the US, where New York has become the latest US state to introduce leg - islation on pay transparency in job advertisements. Equal pay There have also been a number of recent develop - ments in case law on equal pay. In Germany, for exam -
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INTRODUCTION Contributed by: Tobias Pusch and Teresa Gabele, Pusch Wahlig Workplace Law
The Guide’s Purpose Employment law is always in a state of flux and is constantly faced with new challenges due to ever- evolving technology and digitalisation, as well as social developments. Thus, new working models are regularly introduced all over the world and methods are developed to adapt work to modern lifestyles, the needs of society and the circumstances of everyday life. A variety of measures, which differ from country to country, have not infrequently led to highly divergent and sometimes contradictory results. A comparative view of local employment laws in international rela - tions would thus appear essential in a globalised world of work. Remaining appraised of new legal developments and maintaining the visibility of these on the horizon con - tinues to be critical for employers. As employment laws differ from country to country, this guide aims to answer the most relevant questions in employment law in its participating countries and to provide an insight into current issues.
ple, the Federal Labour Court recently rejected an employer’s attempt to justify a pay gap between men and women on the basis of pay negotiation variations. As of mid-2025, Germany has not yet implemented the EU Pay Transparency Directive. However, the Ger - man government is expected to revise the existing Pay Transparency Act ( Entgelttransparenzgesetz – EntgTranspG) with a draft bill anticipated in late 2025. Climate crisis The climate crisis will have a lasting impact on employment law. The conditions under which work is performed vary in terms of carbon footprint. One example is the efforts by employers to minimise travel distances and the associated CO₂ emissions caused by employees travelling to work. In terms of employ - ment law, this means that regulations regarding remote working or the promotion of climate-friendly means of transport are relevant. The sustainable use of resourc - es and the reduction of transport distances require global production chains to be set up more locally in different locations. A correspondingly closer linkage of operational processes requires global alignment and more flexible options under employment law.
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AUSTRIA
Czech Republic
Germany
Slovak
Vienna
Austria
Law and Practice Contributed by: Johannes Edthaler and Christina Hödlmayr Edthaler Leitner-Bommer Schmieder & Partner Rechtsanwälte GmbH
Hungary
Italy
Slovenia
Croatia
Contents 1. Employment Terms p.12 1.1 Employee Status p.12 1.2 Employment Contracts p.12
6. Collective Relations p.20 6.1 Unions p.20
6.2 Employee Representative Bodies p.20 6.3 Collective Bargaining Agreements p.20 7. Termination p.20 7.1 Grounds for Termination p.20 7.2 Notice Periods p.21 7.3 Dismissal for (Serious) Cause p.22 7.4 Termination Agreements p.23 7.5 Protected Categories of Employee p.23 8. Disputes p.23 8.1 Wrongful Dismissal p.23 8.2 Anti-Discrimination p.24 8.3 Digitalisation p.24 9. Dispute Resolution p.25 9.1 Litigation p.25 9.2 Alternative Dispute Resolution p.25 9.3 Costs p.25
1.3 Working Hours p.13 1.4 Compensation p.14
1.5 Other Employment Terms p.14 2. Restrictive Covenants p.16 2.1 Non-Competes p.16
2.2 Non-Solicits p.16 3. Data Privacy p.17 3.1 Data Privacy Law and Employment p.17 4. Foreign Workers p.17 4.1 Limitations on Foreign Workers p.17 4.2 Registration Requirements for Foreign Workers p.17 5. New Work p.17
5.1 Mobile Work p.17 5.2 Sabbaticals p.18 5.3 Other New Manifestations p.19
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AUSTRIA Law and Practice Contributed by: Johannes Edthaler and Christina Hödlmayr, Edthaler Leitner-Bommer Schmieder & Partner Rechtsanwälte GmbH
Edthaler Leitner-Bommer Schmieder & Partner Re- chtsanwälte GmbH is a dynamic law firm in Austria that specialises in business law, with locations in Linz, Vienna, Graz, Dornbirn, Ried, Kitzbühel, Buda - pest and Prague. The firm’s labour law expert team consists of two partners, two attorneys and two as - sociates. The firm advises national and multinational corporations, as well as small and medium-sized businesses from all industry sectors on all issues related to labour law. This includes comprehensive
advice on individual employment law and collective employment law, representation before all courts and government agencies as well as support when in ne - gotiations with works councils, trade unions, or other interest groups. The firm is currently representing two companies on the issue of the continued validity of the works council’s power of representation in the course of a restructuring, as well as two individuals in litigation concerning the infringement of trade and business secrets.
Authors
Johannes Edthaler is an attorney and partner at LeitnerLaw Rechtsanwälte. He advises nationally and internationally active companies with tailored solutions for labour law, corporate and group law as well as
Christina Hödlmayr is an attorney and partner at LeitnerLaw Rechtsanwälte. She advises nationally and internationally active companies with tailored solutions for labour law, global mobility, immigration topics,
business and contract law, and he also represents them before courts and government authorities. In addition, he focuses on real estate law. He regularly lectures and publishes in his areas of expertise, and he is a lecturer at Johannes Kepler Universität Linz.
and business and contract law, and she also represents them before courts and government authorities. In addition, she is a specialist author and lecturer on her areas of expertise, especially in the field of labour law and the Anti-Wage and Social Dumping Act (Lohn- und Sozialdumping- Bekämpfungsgesetz), regarding which she wrote her doctoral thesis.
Edthaler Leitner-Bommer Schmieder & Partner Rechtsanwälte GmbH Kapuzinerstraße 38 4020 Linz Austria Tel: +43 732 730 369 Email: office@leitnerlaw.eu Web: www.leitnerlaw.eu
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AUSTRIA Law and Practice Contributed by: Johannes Edthaler and Christina Hödlmayr, Edthaler Leitner-Bommer Schmieder & Partner Rechtsanwälte GmbH
1. Employment Terms 1.1 Employee Status Labour law protects different types of workers. The different groups of workers are outlined below. White-Collar and Blue-Collar Workers A distinction is made between white-collar work - ers (“employees”) and blue-collar workers. The term “employee” is defined in the Employees Act ( Anges- telltengesetz ). A person’s white-collar status is contin - gent upon the nature of their employer and the duties they undertake. Employees are predominantly employed in the com - mercial sector, the higher, non-commercial services sector or the office sector. The term blue-collar worker is not defined by law. However, based on case law, any worker not identi - fied as a white-collar employee typically falls under the category of “worker”. Different rules apply to blue- and white-collar workers, especially in the following areas: • reasons for early termination of the employment relationship; • in works constitution law (separate works councils for blue- and white-collar workers); • the eligibility criteria for invalidity/occupational dis - ability pensions; and • separate collective agreements in many sectors. Apprentices Apprentices are persons who, on the basis of an apprenticeship contract, receive technical training in an apprenticeship company to learn an apprentice - ship occupation included in the list of apprenticeship occupations and who work within the framework of this training. The Austrian Vocational Training Act ( Berufsausbildungsgesetz ) regulates, among other things, training, the rights and duties of apprentices and persons entitled to apprenticeship, apprentice - ship income and entitlements in the event of work incapacity. Unless otherwise stipulated by this law, the provisions of general labour law (eg, leave entitlement) apply to apprentices.
Marginal Employees A person is considered to be in marginal employment if he or she earns no more than a certain amount per month in regular employment (employment for one month or for an indefinite period). In 2025, the mar - ginal earnings threshold is EUR551.10 per month. Employees in marginal employment are covered by accident insurance but not insured against unemploy - ment. The same labour law provisions apply to marginally employed employees as to all other employees. It may be that collective agreements contain special provi - sions. 1.2 Employment Contracts The employment relationship is a continuing obliga - tion between employer and employee. A contract of employment is regularly concluded for an indefinite period. A contract of employment may also be lim - ited in time until the expiry of a certain date or until the occurrence of a certain event. The succession of several fixed-term employment contracts is inadmis - sible unless each fixed-term is justified by an objective reason. Formal Requirements for Employment Contracts The conclusion of an employment contract is not bound to any particular form. It can be in writing, ver - bally or implied. An exception exists only in certain cases. The employer is obliged by law to issue a service note irrespective of the duration of the employment rela - tionship. The service note must contain certain infor - mation specified in the law as follows: • name and address of the employer; • name and address of the employee; • the start of the employment relationship; • the end date of the employment relationship (in case of fixed-term employment); • duration of the notice period and date of termina - tion – reference to the termination procedure to be followed; • usual place of employment – if necessary, refer - ence to changing places of employment – regis - tered office of the company;
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AUSTRIA Law and Practice Contributed by: Johannes Edthaler and Christina Hödlmayr, Edthaler Leitner-Bommer Schmieder & Partner Rechtsanwälte GmbH
• any classification in a general scheme; • intended use/activity of the employee with the respective employer and brief description of the work to be performed, • initial remuneration (basic remuneration and other remuneration) and due date of remuneration – remuneration for overtime if applicable and method of payment of remuneration; • extent of annual leave; • agreed normal daily or weekly working hours of the employee, unless the employment relation - ship is one to which the Caretaker Act applies, and, if applicable, information on the conditions for changing shift schedules; • designation of any standards of collective legal organisation applicable to the employment con - tract (collective agreement, articles of association, minimum wage scale, fixed apprentice compensa - tion, and works agreement) and reference to the room in the company where these are available for inspection; • name and address of the employee’s social insur - ance institution and occupational pension fund; • duration and conditions of an agreed probationary period; and • if applicable, the entitlement to further training provided by the employer. Either a service note must therefore be issued or an employment contract containing this information. In principle, an employment contract only has to con - tain the statutory minimum content of a service note. In the context of concluding an employment contract, in practice, additional provisions (beyond the statu - tory minimum content) are usually made regarding the employment relationship (eg, fixed term, competition clause, and expiry provision). 1.3 Working Hours General Working Hours Per Day/Week The statutory normal working time is eight hours per day and 40 hours per week (excluding rest breaks). Many collective agreements provide for a reduced normal working week (eg, 38.5 hours per week). If the normal daily or weekly working hours are exceeded, the employee in principle works overtime.
An extension of normal working hours is possible within the framework of various flexible working time models. Models of flexible working time are, for exam - ple, the calculation of working time or flexible work - ing time. In the case of a four-day week, the normal daily working time may be extended to ten hours. The details of flexible working time models can be found in various collective agreements. Extra Work In collective agreements that standardise a nor - mal working week of less than 40 hours, the period between the normal working time according to the collective agreement and the statutory normal work - ing time is referred to as extra work ( Mehrarbeit ). The collective agreements determine whether this time is remunerated with a supplement or without. Overtime Overtime ( Überstunden ) is generally defined as work - ing hours that exceed the normal daily or weekly work - ing hours. They are permitted in the case of increased work demand – however, the employee has a right of refusal. Pursuant to the Working Time Act ( Arbeitszeitgesetz ), employees working overtime are entitled to: • a supplement of 50%; or • compensation in the form of compensatory time (one overtime hour corresponds to 1.5 hours of compensatory time). The employer and the employee can agree on how overtime is to be compensated (money, time off in lieu or a combination of both). The maximum daily working time is 12 hours per day and the maximum weekly working time is 60 hours – but permanently no more than 48 hours per week on a 17-week average. The applicable collective agree - ment may allow for an extension of the calculation period. Part-Time Employees For part-time employees, extra work comprises hours that go beyond their agreed-upon weekly schedule but have not reached the threshold of overtime. The
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AUSTRIA Law and Practice Contributed by: Johannes Edthaler and Christina Hödlmayr, Edthaler Leitner-Bommer Schmieder & Partner Rechtsanwälte GmbH
law stipulates that for these additional hours, part- time employees are entitled to a 25% surcharge on their regular hourly wage. Extra hours are not subject to extra pay: • if they are compensated by time off in the ratio of 1:1 within the calendar quarter or another fixed period of three months in which they have accrued; or • in the case of flexitime, the agreed working time is not exceeded on average within the flexitime period. If collective agreements with shorter normal weekly working hours provide for no or lower bonuses for the extra work (eg, in the case of a collectively agreed normal weekly working time of 38.5 hours and bonus- free extra work of a further 1.5 hours), this overtime regulation shall also apply to part-time employees. If several surcharges, eg, the statutory or collective agreement surcharge, are provided for the additional time worked, only the highest surcharge shall be paid. There is not a cumulative addition of these surcharges. In connection with the organisation and remuneration of working time, the provisions of the applicable col - lective agreement must always be observed. Collec - tive agreements may contain special provisions. 1.4 Compensation Minimum Wage Requirements There is no statutory minimum wage in Austria. Wheth - er there is an entitlement to a certain minimum wage depends primarily on whether a collective agreement is applicable in the respective company. The appli - cability of the collective agreement results from the employer’s affiliation to a contracting association. If a collective agreement applies in the enterprise, each employee shall be classified according to the scheme of the applicable collective agreement, taking into account previous periods of service. The clas - sification is usually based on the job characteristics, the content of the work and the actual predominant activity.
Where no collective agreement is in force, an admin - istrative body responsible for authorising associations to conclude collective agreements ( Bundeseinigung- samt ) may set a minimum wage under certain con - ditions. As there is a collective agreement in most sectors, there is only a minimum wage agreement for a few occupational groups (eg, domestic help and caretakers). Statutory Increases in Minimum Wages Typically, the minimum remuneration outlined in col - lective agreements undergoes yearly increases. These increases are negotiated between the trade unions as employee representatives and the respective employ - er representatives (Austrian Economic Chambers or Liberal Professions Associations). If there is no col - lective agreement, there is no compulsory entitlement to a wage or salary increase. The employee and the employer must agree on this individually. However, wages or salaries should not be set at an unjustifi - ably low level that could be considered unethical or exploitative. Entitlement to Special Payments Salaries are usually paid monthly 12 times a year. How - ever, there is also the possibility of receiving special payments such as a 13th and 14th salary (holiday and Christmas bonuses). The entitlement, amount and due date of these special payments are regulated in the respective collective agreement or individual employ - ment contract. With a few exceptions, the law does not provide for these payments. The respective collec - tive agreement may also provide for other payments, such as anniversary bonuses or additional payments to compensate for specific conditions of a job role, such as working in dirty environments, facing potential dangers, or enduring particularly challenging condi - tions. Otherwise, bonuses, etc, can be contractually agreed between the employer and employee. 1.5 Other Employment Terms According to the Paid Annual Leave Act ( Urlaubsge- setz ), employees are entitled to five weeks of paid leave (30 working days for a six-day working week or 25 working days for a five-day working week) for each working year (leave year). If the employee is regularly employed for only five or fewer days of the week, the leave entitlement shall be converted into the
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AUSTRIA Law and Practice Contributed by: Johannes Edthaler and Christina Hödlmayr, Edthaler Leitner-Bommer Schmieder & Partner Rechtsanwälte GmbH
corresponding working days. From the 26th year of service with the same employer, the amount of leave increases to six weeks. Under certain conditions, cer - tain periods of previous service may already be taken into account for the leave entitlement. Leave entitlement generally expires after two years from the end of the leave year in which it arose. Holiday Pay During leave, an employee is entitled to continued pay - ment of remuneration (holiday pay), even if no work is performed. Holiday pay includes the basic wage/base salary and other remuneration (eg, bonuses, commis - sions, allowances and overtime) on average. Entitlement in the Event of Illness If an employee cannot work for health reasons that were not their fault or caused through gross negli - gence, he/she is entitled to continued payment of remuneration for six weeks per working year. The entitlement to continued payment of remuneration increases to up to 12 weeks depending on the dura - tion of the employment relationship. For each addi - tional four weeks, the employee remains entitled to half pay. The other half is covered by social insurance. After the period of continued payment of remunera - tion, sickness benefits from social insurance are due. Entitlement in the Event of an Occupational Accident If an employee is prevented from performing his/her work due to an accident at work or occupational dis - ease, he/she shall retain his/her entitlement to remu - neration for up to eight weeks per working year. The entitlement to remuneration shall be increased to ten weeks if the employment relationship has lasted for 15 years without interruption. Care Leave An employee shall be entitled to continued payment of remuneration up to the maximum of his/her regu - lar weekly working hours if, after commencement of employment, he/she is absent from work as a result of:
• nursing leave (care required for a close relative, who is ill – living in the same household is not required); • nursing leave (care for a sick person with whom one is not related but who lives in the same house- hold); • care leave (care required for one’s child, if the responsible caregiver is unavailable); or • accompanying leave (accompaniment of a child under ten years old by the parents during inpatient hospitalisation). Legal Entitlement to Time Off to Accompany Children During Rehabilitation Since 1 November 2023, employees are entitled to up to four weeks’ leave per year to accompany their child, who is not yet 14 years old, during rehabilita - tion. From the notification of the claim until the expiry of four weeks after the end of the rehabilitation leave, the employee is under special protection against ter - mination and dismissal. Employees are entitled to care leave benefits during this time. Maternity Leave Protection period for expecting mothers As a general rule, expectant mothers are prohibited from working eight weeks before their child’s due date. This employment restriction typically continues for eight weeks following the birth. In the case of pre - mature or multiple births, or caesarean section, the period is extended to twelve weeks. If the pre-birth non-working period is reduced, an equivalent exten - sion is granted post-birth, but up to a maximum of 16 weeks. During this time, they receive a maternity allowance from the Austrian Social Insurance. The employer does not pay any remuneration during the protection period. Parental Leave Mothers or fathers are entitled to take parental leave up to the day before their child’s second birthday. This is in addition to the maternity leave. It is possible to apply for childcare allowance during maternity leave as mothers or fathers do not receive any remuneration from the employer during that period.
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AUSTRIA Law and Practice Contributed by: Johannes Edthaler and Christina Hödlmayr, Edthaler Leitner-Bommer Schmieder & Partner Rechtsanwälte GmbH
Violation of Non-Compete Clauses If an employee violates a valid non-compete clause, the employer has several options. The employer can: • claim damages; or • pursue legal action to ensure the employee ceases the competing activity. Enforcement of Non-Compete Clauses The non-compete clause may generally only be invoked if: • the employee terminated the contract without a valid reason; • the employee resigned without a valid justification; • the contract was amicably terminated; • the fixed term ended; or • the employer dismissed the employee due to the employee’s own actions. The successful assertion of a claim for damages usu - ally fails because the amount of the damage incurred cannot be quantified with the legally necessary clarity. For this reason, it is possible to agree on a contractual penalty. Such a contractual penalty can be claimed in the event of a breach of the non-compete clause without having to prove the occurrence of damage. However, it is subject to the judicial right of modera - tion and is only effective if it does not exceed six times the net monthly remuneration due for the last month of the employment relationship. The agreement of a con - tractual penalty excludes claims for injunctive relief or compensation for further damage. 2.2 Non-Solicits In addition to the agreement of a general non-com - pete clause, non-solicitation clauses with reference to employees and with reference to customers may also be agreed between an employer and employee. Employee Protection Clause The term employee protection clause covers agree - ments according to which the employee may not work with the employer’s employees after termination of the employment relationship. Employee protection claus - es are usually to be qualified as non-compete clauses and must not restrict the former employee too much.
The full entitlement to parental leave of 24 months is only available if both parents take at least two months of parental leave. If only one parent takes parental leave, the duration is reduced to 22 months. There is an exception for single parents: they can still take parental leave until the child’s second birthday. Employee Liability Employees are only liable to a limited extent for dam - age they have caused at work. Their financial capac - ity is taken into account when determining the extent of their liability. For employees to be liable, damage must actually have occurred during the performance of the service. The damage must be the fault of the employee and there must be no grounds for exclu - sion of liability. The claim must not have lapsed or become time-barred. These provisions are regulated in the Employees’ Liability Act ( Dienstnehmerhaftpfli - chtgesetz ). 2. Restrictive Covenants 2.1 Non-Competes Agreement of Non-Compete Clauses Between Employer and Employee A non-compete clause is an agreement that restricts the employee’s employment in favour of the employ - er for the period after termination of the employment relationship. A non-compete clause can be agreed upon in employment contracts. The precondition for the admissibility of a non-com - pete clause is that the employee: • is of age at the time of the conclusion of the agree - ment; and • is entitled to remuneration (excluding special payment components) of more than EUR4,300 gross (for the year 2025) for the last month of the employment relationship. The restriction of gainful employment contained in the non-compete clause may only relate to the business sector of the relevant enterprise and may not exceed one year. At the same time, it must not deprive the employee of any possibility of gainful employment.
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AUSTRIA Law and Practice Contributed by: Johannes Edthaler and Christina Hödlmayr, Edthaler Leitner-Bommer Schmieder & Partner Rechtsanwälte GmbH
Customer Protection Clause An agreed customer protection clause aims to pro - tect the employer’s customer base and to prevent the poaching of the existing customer base. Customer protection clauses are generally regarded as non- compete clauses by case law. The statutory provi - sions on non-compete clauses are therefore to be applied mutatis mutandis. 3. Data Privacy 3.1 Data Privacy Law and Employment During the employment relationship, employee data is stored, processed and forwarded and further data is collected, eg, during employee checks. Data pro - tection provisions in the context of labour law can be found in both the EU General Data Protection Regu - lation (GDPR) and the Austrian Data Protection Act ( Datenschutzgesetz ). The employment of foreign nationals in Austria is guid - ed by the Act Governing the Employment of Foreign Nationals ( Ausländerbeschäftigungsgesetz ). Foreign workers can only be employed in Austria under certain conditions. In connection with the employment of workers, every person who does not have Austrian citizenship is considered a foreigner. The employ - ment of foreign workers in Austria is only permissi - ble if they are generally excluded from the scope of application of the Act Governing the Employment of Foreign Nationals or if they have official approval for their employment. The Act Governing the Employment of Foreign Nationals provides for a large number of exemptions for various groups of persons. Exempted are, for example, persons entitled to asylum, artists or certain executives. Furthermore, there are – among others – the following possibilities for the official approval of the employ - ment of a foreigner: 4. Foreign Workers 4.1 Limitations on Foreign Workers
• Red-White-Red Card/Blue Card EU – qualified workers from third countries can settle permanent - ly in Austria and work here with the Red-White-Red Card/Blue Card EU; and • access to the labour market for pupils and stu - dents – pupils and students with an appropriate residence permit may also be gainfully employed if this does not interfere with their education as their primary purpose of residence. The specific type of employment permit that a for - eign national must obtain is determined based on their individual circumstances. In addition to the cri - teria of the Act Governing the Employment of Foreign Nationals, the requirements under immigration law for the residence of a foreign national in Austria must be observed. 4.2 Registration Requirements for Foreign Workers Foreign workers require a combined work and resi - dence permit allowing employment with a specific employer (eg, Red-White-Red Card), free employ - ment market access (eg, Red-White-Red Card plus, Permanent Residence – EU) or an employment market authority authorisation (employment permit) in addi - tion to their residence permit (eg, students) or visa (seasonal workers). This depends on the specific indi - vidual case. In Austria, as of 1 January 2025, the legal framework for “home office” has been extended to telework. In the past, there were no general statutory rules on mobile work, and legal provisions only applied to work from home. With the new law, the distinction between home office and telework loses importance. The provi - sions that were previously limited to home office now apply to telework in general. Telework is understood to mean the regular perfor - mance of work outside the employer’s premises, either at the employee’s residence or at another location of their choice. This may include, for example, a relative’s home, libraries, coffee shops, or co-working spaces. 5. New Work 5.1 Mobile Work
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AUSTRIA Law and Practice Contributed by: Johannes Edthaler and Christina Hödlmayr, Edthaler Leitner-Bommer Schmieder & Partner Rechtsanwälte GmbH
5.2 Sabbaticals In Austria, “sabbatical” is not a legally defined term, but a term that has arisen in practice for different forms of professional leave. A sabbatical is usually understood as a long-term leave agreed between the employee and the employer. The following contractual bases are possible as legal bases for long-term leave in the form of a sabbatical. Agreement on Unpaid Leave In this context, it should be noted that compulsory insurance continues during unpaid leave of up to one month. This is subject to the condition that the employment relationship is not terminated during this period. If the unpaid leave is agreed for longer than one month or if the employment is not continued after the end of this month, the insured person shall be deregistered as of the day before the start of the unpaid leave. Agreement on Educational Leave In Austria, the current scheme of educational leave will be replaced by the new “educational time” model from 2026 onwards. Educational time can be agreed between the employer and the employee after at least one year of employment (or 12 months within the last 24 months and at least three months immediately prior to commencement in seasonal businesses). The leave may last for a minimum of two months up to one year without pay. During this period, employees are entitled to an edu - cational allowance, provided they meet the eligibility requirements under unemployment insurance law and complete further training. Under the new regime, the minimum training requirement is increased to 20 hours per week (16 hours in the case of childcare obliga - tions). In the case of university studies, at least 20 ECTS (European Credit Transfer and Accumulation System) credits must be earned (16 with childcare obligations). Attendance obligations are strengthened, with a focus on seminar-style courses in-person or live-online, and employees must provide proof of par - ticipation. Further innovations include mandatory educational counselling before applying for the allowance, an
Employers and employees cannot unilaterally impose telework. Any agreement must be made in writing. Collective bargaining agreements may provide for framework conditions of telework; however, these provisions only apply if they are more favourable than the statutory rules. Framework conditions may also be agreed by works agreements, in particular regarding the provision and private use of work equipment, cost reimbursement, or a right to return to on-site work. Employees in telework remain “regular employ - ees” under Austrian labour law. All employment law provisions fully apply, including working time rules, holiday entitlement, parental leave, and equality law. Employers are obliged to provide the necessary digital work equipment (such as laptop, phone, and internet access). If employees use their own devices, they are entitled to reimbursement of reasonable and neces - sary costs, which may also be paid in the form of lump sums. The same data protection obligations apply in tele - work as in the office, including requirements for data security and confidentiality. Employers and labour inspectors may not enter employees’ homes to ver - ify compliance without the employee’s consent. The Employees’ Liability Act applies to telework, extend - ing liability relief to damages caused by household members or pets during telework. Austrian Social Security Regulations for Cross- Border Home Office Work In principle, the “normal” provisions of Regulation (EC) No 883/2004 apply in relation to other EU/EEA states. This means that if the employee works at home for at least 25% of the time, the employee’s country of residence is responsible for social insurance. The EU is currently working on a pan-European solution to facilitate cross-border telework. In the absence of current legal regulations, the frame - work conditions for mobile work are to be agreed between the employee and the employer. However, the government is currently considering whether the regulations for home office should now also be extended to mobile working.
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