Can I hire employees in Austria without setting up a local company?

Yes, by using an Employer of Record (EOR) or PEO in Austria, you can legally employ local staff without establishing an Austrian legal entity. The EOR becomes the formal employer while you manage the employee’s daily work.

What is the difference between an EOR and a PEO in Austria?

An EOR acts as the legal employer on your behalf and fully assumes responsibility for employment compliance, payroll, and registrations. A PEO typically supports companies that already have an Austrian entity and shares HR responsibilities rather than fully employing the worker.

Are permanent contracts mandatory in Austria?

Permanent (indefinite) contracts are the default and most common employment type in Austria. While fixed‑term contracts are permitted, they must be justified and are subject to more stringent regulation under Austrian labor law.

How much does it cost to employ someone in Austria?

Employer costs in Austria generally amount to approximately 21–22.5% on top of the gross salary, depending on the employment structure and municipal tax applicability. This includes social security and mandatory contributions.

Are 13th and 14th salary payments required in Austria?

They are not mandated by national law but are standard practice in Austria and often required under collective bargaining agreements or individual employment contracts. Most employees expect these additional payments.

How does severance work in Austria?

Austria uses a mandatory severance fund system. Employers contribute 1.53% of gross salary monthly into an employee‑specific fund, which can be accessed in cases of termination, resignation, or retirement.

What notice period applies when terminating an employee in Austria?

Statutory notice periods generally start at six weeks and increase with employee seniority. Longer notice periods may apply based on employment contracts or collective bargaining agreements.

How many vacation days do employees receive in Austria?

Employees are entitled to at least 25 paid vacation days per year, increasing to 30 days after longer service. Public holidays are granted in addition to annual leave.

Who handles payroll taxes and social security when using an EOR in Austria?

When hiring through EuroDev’s EOR service in Austria, all payroll calculations, tax withholdings, social security payments, and reporting obligations are handled by EuroDev.

How quickly can I hire someone in Austria through an EOR?

Hiring through an EOR is significantly faster than setting up a local entity. In most cases, employees can be onboarded within a few weeks, subject to contract finalization and registrations.

PEO & EOR services · Austria

Hire employees in Austria with an Employer of Record

Hiring in Austria through an EOR does not require setting up a local legal entity. EuroDev becomes the legal employer running payroll and compliance while you keep full operational control.

✓ No entity required

✓ Onboard in weeks

✓ Full compliance managed

Talk to our EOR experts today →

AUSTRIA · EMPLOYER COST SNAPSHOT

Avg. annual gross salary €55.678

Employer contributions ≈ 29-30 %

Statutory annual leave 25 days

Standard work week 40 hrs

Source: EuroDev EOR payroll data for Austria, 2026.

PEO & EOR services · Austria

How hiring in Austria through EuroDev works

An Employer of Record lets your company hire in Austria without establishing an Austrian subsidiary or branch. EuroDev becomes the legal employer, while your company retains day-to-day operational direction.

Employee selection

You select the candidate you want to hire in Austria.

Contract setup

EuroDev drafts a locally compliant contract, aligned with labor law and applicable CBAs.

Payroll & tax

We run monthly payroll and report income tax and social security accurately.

Ongoing compliance

Employment administration, benefits, and paid leave managed continuously.

The decision

Direct expansion vs. partner-led market entry

Both paths are legitimate - the right one depends on how fast you need to move and how permanent your presence in Austria will be.

Most chosen

Employer of Record

When an EOR is the right choice

✓ You want to hire quickly without long setup times

✓ You are testing the Austrian market

✓ You plan to hire a small or distributed team

✓ You want to minimize legal and compliance risk

Local Entity

When a local entity makes sense

✓ You are building a large, long-term workforce in Austria

✓ You require a permanent commercial presence

✓ You want full internal control over payroll and HR

Employment contracts

Permanent and fixed-term contract rules

Austria assumes employment is indefinite by default - repeated renewals of fixed-term contracts may lead to permanent status..

Contract type · default

Permanent (indefinite)

✓ No predefined end date

✓ Statutory notice periods for termination

✓ Mandatory severance contributions through the Austrian severance fund system

✓ Common entitlement to 13th and 14th salary payments under CBAs or contracts

✓ Probation permitted within legal limits

Contract type · limited use

Fixed-term (temporary)

✓ Only for a genuine, justified temporary need

✓ Contracts must specify a clear end date

✓ Repeated renewals may lead to permanent status

✓ Fixed-term employees generally receive the same statutory benefits as permanent staff

Termination, notice & severance

Austria has strong employee protection laws

Employment ”at will” does not apply when hiring through an EOR in Austria.
EuroDev guides you through termination procedures to ensure compliance.

6 weeks

Minimum statutory notice

20 days

Severance per year of service

12 mo.

Maximum severance cap

Probation

Probation periods

Not mandatory, but must be agreed in writing. For most roles, the maximum probation period is one month, though applicable collective bargaining agreements may set specific conditions. Either party may terminate without notice or severance during a lawful probation.

In practice

Notice & severance in practice

Notice may be extended by contract or collective agreement, and payment in lieu is permitted. No notice is required for gross misconduct, and no severance is owed for valid disciplinary dismissals.

Payroll & employer costs

What hiring through an EOR costs in Spain

Employer costs typically run around 29.90% on top of gross salary - covering all mandatory employer charges and statutory contributions.

Cost example

Estimated annual employment cost

Average annual gross salary €58,754

Employer contributions (≈29.90%) €17,344

Estimated total employment cost €76,098

Contribution breakdown

Mandatory employer contributions

Social security

~21.00%

Family Burdens Equalisation Fund (FLAF)

3.70%

Municipal payroll tax

3.00%

Chamber of Commerce Levy

0.35%

Mandatory severance fund

1.53%

Insolvency Remuneration Fund (IEF)

0.55%

Total estimated

~29.90%

Registration

Social security registrations

✓ Registering employees

✓ Wage tax withholding

✓ Monthly payroll and contribution reporting

✓ Withholding employee contributions

✓ Paying employer social security contributions

Working time

Working hours & overtime

✓ Standard schedule: 40 hours/week, 8 hours/day

✓ Legal overtime limit: 80 hours per year

✓ Usually governed by collective agreements (CBAs)

✓ Compensated financially or with time off

Paid leave & public holidays

Statutory leave entitlements in Spain

EuroDev ensures every leave entitlement is tracked and administered correctly, from vacation days to parental leave.

Vacation

Annual leave

25 days

✓ Minimum of 25 paid vacation days per year

✓ Increases to 30 days after 25 years of service

Statutory

Public holidays

13 days

✓ 13 paid public holidays annually

✓ Observed nationwide

Parental leave

Maternity leave

16 weeks

✓ First 8 weeks before birth

✓ Remaining 8 weeks after birth

✓ Paid at 100% via Social Security

✓ Employer top-up not mandatory

Parental leave

Paternity leave

1 MONTH

✓ Must be taken shortly after the birth of the child

✓ Employment protection applies during approved leave

✓ Fully paid by Social Security

✓ "Family Time Bonus" leave

Ready when you are

Hire employees in Austria with confidence

Local expertise · Global support

EuroDev helps international companies hire in Austria quickly, compliantly, and without unnecessary risk whether you're onboarding your first employee or expanding an existing team.

Talk to our EOR experts → Explore EOR services

What happens after you contact us? +

1 Share your hiring needs and expected timeline.

2 Receive a compliant employment setup plan.

3 Start contract preparation and employee onboarding.

FAQ's

: Yes, by using an Employer of Record (EOR) or PEO in Austria, you can legally employ local staff without establishing an Austrian legal entity. The EOR becomes the formal employer while you manage the employee’s daily work.
: An EOR acts as the legal employer on your behalf and fully assumes responsibility for employment compliance, payroll, and registrations.

A PEO typically supports companies that already have an Austrian entity and shares HR responsibilities rather than fully employing the worker.
: Permanent (indefinite) contracts are the default and most common employment type in Austria.

While fixed‑term contracts are permitted, they must be justified and are subject to more stringent regulation under Austrian labor law.
: Employer costs in Austria generally amount to approximately 21–22.5% on top of the gross salary, depending on the employment structure and municipal tax applicability. This includes social security and mandatory contributions.
: They are not mandated by national law but are standard practice in Austria and often required under collective bargaining agreements or individual employment contracts. Most employees expect these additional payments.
: Austria uses a mandatory severance fund system. Employers contribute 1.53% of gross salary monthly into an employee‑specific fund, which can be accessed in cases of termination, resignation, or retirement.
: Statutory notice periods generally start at six weeks and increase with employee seniority. Longer notice periods may apply based on employment contracts or collective bargaining agreements.
: Employees are entitled to at least 25 paid vacation days per year, increasing to 30 days after longer service. Public holidays are granted in addition to annual leave.
: When hiring through EuroDev’s EOR service in Austria, all payroll calculations, tax withholdings, social security payments, and reporting obligations are handled by EuroDev.
: Hiring through an EOR is significantly faster than setting up a local entity. In most cases, employees can be onboarded within a few weeks, subject to contract finalization and registrations.