Dismissal

The term "dismissal" refers to the premature dissolution of an employment relationship declared by the employer for good cause. The reasons that entitle the employer to a dismissal must be of such a serious nature that in the employer’s objective consideration, the continued employment of the employee, even just for the duration of the (statutory or agreed) notice period, is unreasonable. The dismissal must be announced immediately after the employer becomes aware of the reason for the dismissal.

There are no special formal requirements (e.g. written); also implied behaviour is sufficient. When declaring the dismissal, however, it must be clearly evident that there is a serious and undoubted intention to terminate the employment relationship immediately. The dismissal is however only effective upon notification, and therefore must be received and cannot be unilaterally revoked.

Grounds for dismissal

Austrian labour law lists the reason that justify a dismissal for white-collar workers as defined under the Federal Salaried Employees Act (AngG) in a demonstrative fashion (i.e. based on example) and in an exhaustive fashion (i.e. complete) for blue-collar workers under the GewO. The general clause of Section 1162 of the ABGB stipulates that the right to premature withdrawal in the event of good cause is open to either contracting party in the employment relationship.

For example, white-collar and blue-collar workers can be dismissed for the following reasons:

  • White-collar workers under the Federal Salaried Employees Act, if they:
    • are disloyal in their service or are found guilty of an act that makes them appear unworthy of the employer’s trust
    • are not able to perform the promised work or perform the work considered appropriate given the circumstances
    • do not perform the work without a lawful reason (e.g. illness, accident) or persistently refuse to perform the work
    • operate an independent commercial undertaking or enter into transactions in the same line of business as the employer for their own account or the account of a third party without the consent of the employer
    • are prevented from performing their services due to an extended custodial sentence or due to a significant absence in light of the circumstances, except due to illness or an accident
    • violate moral decency, are guilty of defamation or commit acts of violence (e.g. theft, misappropriation, physical injury) against the employer or employees
  • Blue-collar workers under the GewO, if they:
    • when concluding the employment contract, mislead the business owner by presenting false certificates, documents, etc., or do not disclose the existence of another employment relationship
    • persistently breach their obligations
    • are found to be incapable of performing the work
    • abandon the work without authorisation
    • fail to overcome their alcohol addiction despite multiple unsuccessful warnings
    • are found guilty of a theft, misappropriation or another criminal offence that makes them appear unworthy of the employer’s trust
    • are found guilty of a gross defamation of character, physical injury or a dangerous threat against the employer or employees
    • disclose a business or trade secret or operate a detrimental secondary business without the consent of the business owner
    • attempt to induce other workers to dissent, to rebel against the business owner, to enter into disorderly conduct or immoral or unlawful actions
    • are afflicted with a deterring disease or are at fault for becoming incapacitated for work
    • are required to serve a custodial sentence in excess of 14 days

Caution

If a pregnant woman is dismissed without knowledge of her pregnancy, she remains entitled to protection against dismissal despite this, if she meets her duty to provide information on the pregnancy in line with the termination regulation under the Federal Maternity Protection Act and informs the employer of her pregnancy within five working days of notification of the dismissal.

Consequences of dismissal

Every dismissal – including unfair dismissal – ends the employment relationship with immediate effect. Continuation of work is interpreted as renouncement of the dismissal in the eyes of the court.

In companies with an elected works council, the owner of the company must notify the works council of every dismissal without delay. The works council can require the employer to consult them within three working days of the dismissal.

Fair and unfair dismissal have different legal consequences:

With fair dismissal, final accounting is carried out. This incorporates remuneration up to the end of the working relationship, holiday pay and in the case of administrative employees, pro rata special payments. Workers are in the event of a dismissal due to fault liable to pay damages, they must reimburse all damages connected with their fair dismissal.

With unfair dismissal, the employee is entitled to all claims they would have received with a timely and scheduled termination by the employer ("severance payment").

Please note

The employee can generally appeal against the dismissal before the Labour and Social Court within two weeks (sometimes one week) of receipt of the dismissal. Upon the employee's request, the works council can also lodge an appeal with the court within one week.

Further Links

Legal basis

Translated by the European Commission
Last update: 18 July 2022

Responsible for the content: Federal Ministry of Labour and Economy

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