🇦🇹 Hiring in Austria

💡 Everything you need to know to hire and manage employees in Austria through Toku. Toku handles payroll processing, tax withholding, social contributions, and statutory compliance. This guide covers what you need to plan costs and manage your team.

At a Glance

Onboarding a New Hire

Plan for 5-7 business days between submitting a new hire and their start date. Before day one, Toku registers the employee with Austrian social insurance, which must be completed before they start work. Your new hire just needs to provide their health insurance details and return the signed employment contract.

Submit your new hire through the Toku platform and we take it from there: local employment agreement, statutory registrations, and payroll setup. See Onboard Contributors as a Client Admin in Toku for the step-by-step process, and the Country Readiness Live Tracker for lead times across all countries.

Employer Costs

On top of gross salary, employers in Austria pay the following contributions:

As a rule of thumb, total cost of employment is roughly 129-130% of gross salary. Keep in mind that gross salary in Austria means 14 payments per year: nearly all employees receive a 13th month salary (holiday bonus, usually June) and a 14th month salary (Christmas bonus, usually November or December), each equal to one month's pay. Budget accordingly.

Employees pay their own social insurance (approximately 18.07% for those earning above EUR 2,630/month) plus progressive income tax of up to 55%. These are withheld from gross salary, not paid on top. Toku calculates and remits all of the above.

Compensation & Payroll

Toku runs one payroll per month in Austria, and employees receive a detailed payslip each cycle. Salaries are paid in EUR.

Austria has no statutory national minimum wage. Minimums are set by sector collective agreements and typically range from EUR 1,900 to EUR 2,300 per month for entry-level roles, with a EUR 2,000 monthly minimum (across 14 payments) being phased in sector by sector through end-2026.

The 13th and 14th month salaries are paid in June and November/December respectively. They receive favorable tax treatment for the employee (a flat 6% rate up to a ceiling), which makes them a valued part of the package.

Employment Contracts & Probation

• Toku issues a compliant local employment agreement for every hire, aligned with the applicable collective agreement.
• Indefinite-term employment is the standard. Part-time employment is fully recognized and protected.
• Fixed-term contracts are permitted but each renewal needs an objective justification; repeated renewals risk being treated as indefinite employment.
• Probation is 1 month under Toku's employment agreement, which is also the statutory maximum. During probation, either party may end the relationship without notice or cause.

Working Hours

The standard working week is 40 hours (8 hours per day); many collective agreements reduce this to 38 or 38.5 hours. Overtime is paid at 150% of the regular wage, or compensated with time off at a 1:1.5 ratio. Sunday and public holiday work is paid at 200% under most collective agreements.

Hard limits apply: no more than 12 hours per day or 60 hours per week including overtime, with a 48-hour weekly average over any 17-week period. Employees may refuse overtime beyond 10 hours per day or 50 hours per week without giving a reason.

Leave Entitlements

Employees must take at least 2 consecutive weeks of leave each year. Unused annual leave carries over and expires two years after the end of the year in which it was earned. Maternity pay and childcare allowances are funded by social insurance and the government, not by you.

Public Holidays (2026)

Austria has 13 paid public holidays in 2026. December 24 and 31 are half-days under many collective agreements but are not statutory holidays.

Benefits: Required vs. Common Extras

Statutory (included in employer costs above): public health insurance, pension insurance, workplace accident insurance, unemployment insurance, and the Abfertigung Neu severance fund. Every employee is covered from day one.

Toku offers fully sponsored international health coverage through Remote Health. See Remote Health, Your Global Insurance Plan for coverage details and enrollment.

Common extras in Austria include company pension schemes, meal vouchers (tax-free up to EUR 8 per working day), public transport passes (Jobticket), supplementary health insurance, and wellness programs. Toku can advise on the cost impact of any of these.

Ending Employment

Termination in Austria does not require a specific reason for most employees, but strict timing rules apply (notice generally takes effect at the end of a calendar quarter unless the contract allows mid-month dates), and strong protections cover pregnant employees, those on parental leave, and employees with disabilities. Involve Toku early so we can manage the process compliantly. For the process, see How to Terminate an Employee or Contractor.

Severance works through the Abfertigung Neu fund: the 1.53% monthly employer contribution (already included in the costs above) builds a fund the employee can access on termination or retirement. There is no separate severance lump sum for employees hired after 2002, which makes exit costs predictable.

Hiring Someone from Overseas?

Non-EU/EEA nationals need a residence permit with work authorization, most commonly the points-based Red-White-Red Card, with processing times of roughly 8-12 weeks. EU/EEA citizens can work in Austria without a permit under free movement rules. Talk to Toku before extending an offer to a candidate who needs sponsorship.

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Last verified July 2026. This guide is for general information and doesn't constitute legal or tax advice. Your Toku account manager can confirm specifics for your situation.