Austria PEO - Employer of Record

Doing Business With an Austria PEO – EOR

Austria’s geographical location at the heart of Europe provides employers access to several EU markets.

Austria is a good choice for business expansion due to its tax-friendly incentives, including group taxation schemes, research tax credits, etc. Furthermore, being the fourth richest country among the EU nations, Austria also boasts high purchasing power. 

Even though Austria provides many benefits to foreign companies setting up your business entity is not entirely free of challenges. Obtaining an Austrian visa can be another hurdle that can take almost 15 to 30 days due to the vast pool of applicants. Even after establishment, most MNCs face stiff competition in the Austrian market. 

So now, if you’re wondering how to expand in Austria, along with employee hiring, their payroll, being mindful of the local laws, etc., an Austria EOR (Employer of Record in Austria) can come to your rescue.

With Multiplier’s EOR and PEO services, you can hire a global talent pool, tackle employment risks, ensure your hiring is compliant with Austrian laws.

Why use an Austria PEO?

A PEO or Professional Employer Organization is an entity that aids businesses in employee hiring. It acts as a co-employer and helps a business streamline HR operations like workers' compensation, payroll, benefits, etc. 

If you’re wondering how any Austrian PEO helps your overseas business? Here is a section on reasons for opting for PEO Austria.

Time saver 

While you’re focusing on ways to expand your business, the Austrian PEO will take on the role of your co-employer and hire your employees, saving you ample time. You will not have to spend time on tedious paperwork, negotiating with the potential candidates, or swiping through the local laws. 

Minimized HR costs

One of the simplest benefits of opting for PEO services is reducing your HR costs. Among the many services provided by a PEO, HR services are included in the PEO package. Therefore, you need not bear any extra HR costs.

Payroll management

A PEO Austria will help manage your employee’s payroll on your behalf. This simplified process covers distributing salaries to your employees, ensuring their social security contributions, tax deductions, etc. Outsourcing such a service reduces the tasks on your plate.

Management of employee benefits

Your PEO in Austria will ensure that your staff receives every benefit per the local legal norms. This covers healthcare plans, pensions, social security benefits, accident insurance, etc. It ensures that your company stays compliant with domestic laws. 

Austria PEO Costs

Most PEOs either charge a flat fee per staff or a percentage of total wages earned in a company in a year. The average cost of a PEO ranges between $500 to $1500 per employee in a year or 2% to 12% of the total annual wage. A “per-employee” PEO fee structure is beneficial if your staff’s fee depends on commissions. On the other hand, a payroll-based PEO fee structure is a better choice if your employees draw a stable monthly salary.

At Multiplier, we offer PEO services at an affordable budget, starting from $300 per month. You can also use Multiplier’s PEO solution to hire and pay your freelancers all over the globe, and the services start at $40 a month only. This package is per-freelancer-based and covers international payroll and multi-lingual contracts. Our convenient and affordable Austrian PEO services are designed to provide a flexible and effortless hiring experience, ensure timely payments, and offer mandatory benefits to your employees.

How to Hire in Austria?

The Austrian government is sensitive to issues like mistreatment of employees, workplace harassment, and likewise. It provides free access to citizens to lodge a complaint if they feel mistreated or unfairly, thus making labor tribunal complaints in Austria pretty common. Hiring with an Austrian PEO like Multiplier can help you stay compliant with the local laws and onboard your employees hassle-free. 

However, if you’d like to take care of hiring on your own, here are a few essential pointers:

Establishing a local entity in Austria

There are multiple types of companies that can register in Austria, and if you’re looking forward to expanding your business here, there are numerous options to consider:

  • ~Private limited liability company or GmbH
  • ~Joint-stock company (AG)  
  • ~Austria civil law partnership (GesnbR)
  • ~General partnership (OG)
  • ~Silent partnership (stGes)
  • ~Limited partnership (KG)

Austria employment contracts

In Austria, a written employment contract is not necessary; oral contracts are sufficient. Collective agreements representing the two parties (employer and employee) are legally binding. Interests of both parties are taken into consideration, and the basic working conditions are justified. 

However, many companies prefer to draft a written contract, mentioning their staff’s benefits and compensation, termination terms, salary, etc.

Taxation in Austria

Every Austrian employee is subjected to taxation on incomes generated via employment, investment, business, etc. Here are the Austrian employee taxation details:

Annual income in EUR Personal income tax rate in %
Below 11,000 0
11,001 to 18,000 20
18,001 to 31,000 35
31,001 to 60,000 42
60,001 to 90,000 48
90,001 to 1,000,000 50
Beyond 1,000,000 55

Mandatory social security contribution is another feature of the Austrian taxation scheme. Here are the details:

Category of social security Contribution of employee (in %) Contribution of the employer (in %)
Unemployment 3.00 3.00
Pension 10.25 12.55
Sickness 3.87 3.78
Accident 0 1.20
Miscellaneous 1.00 0.70

Austria payroll

For extending payroll to the employees, you have four options in Austria. These are:

  • ~Internal payroll: Moderate to large companies in Austria that have been into business for a long time prefer to manage their employees' payroll internally. These companies need to establish a large HR section for internal payroll management.
  • ~Remote payroll: This option is more suitable for the subsidiaries which have their remote payroll set up with their overseas parent company.
  • ~Payroll processing entities: Austrian payroll processing organizations are another option to manage your employee’s payroll. With this option, even though you’d be outsourcing the payroll, every compliance related to it will be your responsibility.
  • ~Hire Austria PEO: A professional PEO Austria will help you manage your employee payroll efficiently. They will be responsible for ensuring compliance with domestic laws.

Employment benefits in Austria

Employment benefits offered to the employees in Austria include:

Social insurance benefits

Every employee in Austria is entitled to a social security number which grants them social insurance access. This insurance acts as an umbrella and covers sickness, work incapacity, senility, unemployment, maternity, and likewise. It also covers accident insurance, including occupational illness, workplace accidents, etc. 

Parental leaves

In Austria, maternity leave grants women employees 8 weeks' leave, both before and after their childbirth.  Paternity leave of up to one month after childbirth was introduced in 2019. Austria even provides parental leave to both mothers and fathers until their child is two years old. 

13th and 14th-month pay

In Austria, both 13th and 14th-month pay are customary but not mandated by law. However, most Austrian companies provide this pay to retain skilled labor and attract employees, especially before the Christmas holidays and before summer.

Holidays

Austria has 13 public holidays. These are listed below:

  • ~All Saints Day
  • ~Ascension Day
  • ~Assumption Day
  • ~Austrian National Day
  • ~Boxing Day / St. Stephen’s Day
  • ~Christmas Day
  • ~Corpus Christi
  • ~Easter Monday
  • ~Epiphany
  • ~Immaculate Conception Day
  • ~Labor Day
  • ~New Year’s Day
  • ~Whit Monday

Note: If any public holiday falls on a weekend, it is not carried forward to the following Monday. 

Vacation days

In Austria, vacation days depend on the number of days an employee is working. Any employee working five days a week is eligible for 25 vacation days a year. This increases to 6 weeks or 30 days of paid vacation leave a year once an employee serves for over 25 years.

Employee severance and terminations in Austria

For employees in Austria, generally, a one-month probation period is agreed upon in their employment contract. Both the employer and employee can terminate their contract during this period without any justification.

Austria makes it mandatory for the employer to provide advance notice to their staff before termination. For a service period of fewer than 24 months, an employee must serve a statutory notice period of 6 months. An employee who has served for 3-5 years is entitled to 2 months' notice, which increases to 5 months’ notice for those who have served for over 26 years.

Severance pay is also mandatory in Austria. Any employee serving the employer over a month is eligible for 1.53% of their month’s salary to be deposited to an employee provision fund. On termination, the employee can keep this amount in their fund or draw it as severance pay.

Why Multiplier?

Establishing an overseas business comes with complicated compliance-related works and employee liabilities. In addition, the constantly evolving local legislation adds another layer of complication to this hefty task. This is where outsourcing HR services for your organization can help you juggle your company expansion, hiring staff, and other allied activities. 

A reliable PEO like Multiplier can help you tackle all these hurdles and end your topsy-turvy HR management. At Multiplier, we guarantee maximum transparency and precision in your human resource hiring and management. Our customers are our top priority, and by opting for our services, you can focus on growing your business without stress.

Our Austria PEO Simplifies Your Expansion

  • ~100% statutory compliance
  • ~On-time global payroll processing
  • ~No hidden charges
  • ~Seamless management and payment of global human resources
  • ~Top-notch security of sensitive internal information
  • ~Doesn’t require a local entity
  • ~Precision and transparency of employee hiring and management

#1 Global Employment Solution
Build a global brand
Local HR experts for global teams
Market entry in minutes
90% lesser expansion costs
Increase employee satisfaction
Zero employment risks
Save with no local entities
24x7 HR & Payroll support
Automated employee contracts
One-click payrolling
Pay employees in local currency

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Frequently Asked Questions

Is there any difference between PEO and EOR?

PEO and EOR have minimal yet significant differences. EORs can help you with partial HR functions (hiring human resources, terminating employees, etc.). On the other hand, PEOs take on every bit of HR-related activities (payroll, taxation, regulatory compliance, etc.). Thus, an Austria PEO will act as your company’s co-employer, while an Austria EOR will serve as a legal employer.

EORs are mainly used for contractual or fluctuating workforces, while on the flip side, at least 5 to 10 employees are mandatory for PEO services.

How can PEO Austria help my business?

Austria PEO will act on your behalf to take care of employee hiring and allied activities. Most PEOs offer services like onboarding, HR management, payroll, managing employee benefits, etc. PEO Austria will provide your business with essential services and infrastructure to ensure its smooth functioning.

Which businesses require PEO services?

Any kind of business can opt for PEO services. Be it retail, Hi-tech, manufacturing, or finance - every sector can ease out their business expansion by going for co-employment via a PEO.

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