Employment 2025

AUSTRIA Law and Practice Contributed by: Johannes Edthaler and Christina Hödlmayr, Edthaler Leitner-Bommer Schmieder & Partner Rechtsanwälte GmbH

increased minimum amount of the allowance to facili - tate participation by low-income earners, and stricter rules on timing: educational time may not immedi - ately follow parental leave, with at least 26 weeks of employment subject to unemployment insurance con - tributions required in between. Moreover, employers are expected to face new obligations, such as finan - cial contributions to costs and retention requirements for employees after completion of the educational measure. Agreement on a Leave of Absence Without Pay A leave of absence without pay may be agreed for a period of at least six months up to one year, for which a subsidy from funds of the unemployment insurance or the Austrian Public Employment Service is claimed. Suspension Agreement In this case, the employment relationship is terminated and at the same time a re-employment commitment is agreed between the employee and the employer. These sabbatical variants are only possible by agree - ment between employer and employee. There is no legal entitlement with the possibility of unilaterally enforcing a sabbatical. 5.3 Other New Manifestations “Workation” The “workation” – a combination of work and vaca - tion – remains, in 2025, a new work phenomenon. This allows employees to work in other parts of the world. However, under Austrian law, there is no explicit legal basis for a workation. Therefore, the legal frame - work conditions must be carefully examined in each individual case and a contractual agreement on the framework conditions would be recommended. General Protection Against Dismissal According to a recent ruling of the Austrian Supreme Court, the general protection against dismissal for employees only applies if a domestic establishment exists. This clarification significantly restricts the scope of dismissal protection in cross-border employ - ment situations, as employees linked exclusively to a foreign establishment cannot invoke the Austrian regime. Employers with international structures should

therefore carefully assess whether an Austrian estab - lishment is deemed to exist when planning dismissals. Implementation of the EU Pay Transparency Directive Austria must transpose the EU Pay Transparency Directive (Directive (EU) 2023/970) into national law by 7 June 2026. The Directive introduces far-reaching obligations for employers, including pay transparency in job advertisements, information rights for employ - ees regarding pay levels and comparisons, and reporting duties on the gender pay gap for companies with 100 or more employees. Employers will also be obliged to conduct joint pay assessments if gender- related pay differences of more than 5% persist. Non- compliance may result in damages claims, retroactive pay adjustments, reversal of the burden of proof in litigation, and administrative fines. Early preparation remains essential for Austrian companies. Dual Leadership Shared leadership or topsharing is a partnership- based leadership concept with new forms of decision- making and the further development of the job-sharing model for top positions. In this model, two managers are supposed to hold a position together, lead a team on an equal footing and take responsibility together. In practice, this will probably mostly be implemented by agreeing on part-time employment relationships. Hot-Desking Hot-desking is an organisational workspace system in which employees no longer have their own, per - manently assigned desk, but share desks with other employees. The decision of “where” and “how” work is performed typically falls under the employer’s direc - tive power, allowing them to set these parameters uni - laterally. However, if a works council exists, it might have a say in shaping the specifics of hot-desking. Introducing this system could trigger certain co-deter - mination rights. While Austria currently lacks extensive case law on this topic, many Austrian companies have already adopted the hot-desking approach.

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