An employee for the purposes of employment contract law is any individual who is obliged to perform work for an employer based on an employment contract. The employment relationship is a continuing obligation. The purpose of this relationship is to perform work and it is established by way of an employment contract concluded in writing, orally or implicitly.

The essential features of an employment relationship are:

  • Personal dependence (classification in the operating organisation, obligation to follow instructions, control, disciplinary responsibility, personal service obligation)
  • Economic dependence of the employee
  • Entitlement to remuneration (not a mandatory feature)
  • Employees enjoy the full protection of labour law.

Employees are divided into the following groups with different rules and regulations:

Please note

Board members of public liability companies are effectively not considered employees for the purposes of employment contract law. Managing partners of a private limited company do not qualify as employees for the purposes of employment contract law, if their participating interest and the resulting rights allow them to exercise significant influence over the company.

The termination of the employment relationship as a continuing obligation requires a separate terminating action:

fixed-term employment relationship is an exception. This ends at the end of term.

Companys have to register their employees with the Austrian Health Insurance (Österreichischen Gesundheitskasse – ÖGK) before starting work.

In accordance with the Allgemeines Sozialversicherungsgesetz (Federal Act on General Social Insurance – ASVG)German text, employees are fully insured under health, pension and accident insurance, provided that the remuneration exceeds the de minimis treshold. Employees are entitled to sickness benefits and a maternity allowance, and receive unemployment insurance. In any case, any individual liable to income tax for the purposes of the Einkommensteuergesetz (Federal Income Tax Act – EStG) is considered an employee under the ASVG.

Marginally employed persons are subject to compulsory accident insurance; they can take out health and pension insurance themselves on a voluntary basis.

Compulsory insurance ends with the end of the employment relationship (or entitlement to remuneration).

Employees in Austria are not required to pay income tax to the tax office themselves. Income tax is deducted from the employee’s gross pay in the form of salaries tax and paid to the tax office by the employer.

Employees may assert their claim to overpaid salaries tax by submitting the employee tax assessment (formerly: employee tax return) to their competent tax office ( BMF)German text.

But, in certain cases ( oesterreich.gv.at), employees also have to submit an assessment.

Further information

Online gross/net calculator ( BMF)German text

Legal bases

Translated by the European Commission
Last update: 1 January 2024
Responsible for the content:
  • Federal Ministry of Finance
  • Federal Ministry of Labour and Economy

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