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Cross-Border Hiring Out of Workers in the EU

Cross-border hiring out of workers occurs when foreign employers or agencies make their employees available to an Austrian firm in order to carry out work.

The Entitlement to Fair Payment of Workers Hired Out Across Borders

Workers hired out across borders are entitled to receive appropriate levels of payment which are usual for the area in question. When assessing reasonableness, the pay based on collective agreements or legally established payment received by comparable workers for comparable activities in the same company should be used as an orientation aid for the duration of the hiring period.

Wage inspections serve to prevent wage dumping and social dumping, and large fines are imposed in cases of workers being underpaid.

In the case of illness or accidents, for public holidays, or as long as a person is unable to work for important reasons, workers hired out across borders have the same right to continued pay as comparable domestic workers.

The Entitlement to Paid Leave of Workers Hired Out Across Borders

In accordance with the Anti-Wage and Social Dumping Act, workers hired out across borders are entitled to paid leave as laid down by the Paid Annual Leave Act as long as the extent of their paid leave is less in their home country (where they usually work) according to the legal provisions there.

After the end of their period of being hired out, these workers retain a proportion of their entitlement to paid leave: a pro-rata portion of the difference between the higher Austrian entitlement to paid leave and the entitlement to paid leave which applies in their home country. Workers for whom the paid leave regulations of the Construction Workers Holidays and Severance Pay Act apply are excepted from this arrangement.

Entitlement in the Case of Redundancy and Dismissal

Workers hired out across borders have a right to the same periods of notice and termination dates as comparable domestic workers. If these are not adhered to, they have a right to compensation, particularly compensation for redundancy.

If comparable workers who are usually resident in Austria have special protection against redundancy and dismissal, this also extends to workers hired out across borders.

Obligations of Companies Who Hire Out and Employ Temporary Foreign Workers

Notifying the Authorities About Hired-Out Workers

Foreign employers and agencies hiring out their employees on a permit-free basis to Austria have to notify the Central Coordination Office for the Monitoring of Illegal Employment (based at the Federal Ministry of Finance) in electronic form using the web form ZKO4. This has to be carried out at the latest before the person starts work in Austria.

Changes to the data provided to the authorities also have to announced immediately.

Keeping Documents on Notifications, Wages and Social Insurance on File

The Austrian hirer has to keep the following on file for inspection at the place of work or make them accessible: notification of the authorities about temporarily hiring a foreign worker, and – if there is no compulsion to pay social insurance contributions for the worker in Austria – records on the registration of the worker in the social insurance system (particularly the social insurance document A1). The hirer also has to keep any work permit on file which was issued to the worker in the country where the company or agency hiring out the worker is based.

Foreign employers or agencies which hire out workers are obliged – for the duration of the deployment of workers in Austria – to keep wage records on file in German for inspection as proof that the wage which is due to the workers according to Austrian law is being paid.

The following are considered to be wage documentation: the employment contract or work card, pay slips, proof of the payment of wages or bank transfer slips, wage records, records of working hours, and documents on wage classification. The employment contract can also be kept on file in English.

The Austrian hirer has to keep wage documentation on file at the place of work or deployment.

Penalties in Relation to the Obligation to Notify the Authorities

Employers or agencies who hire out foreign workers and do not provenly provide wage documentation to hirers, or hirers who do not keep wage documentation on file, commit an administrative offence which can lead to fines at the following levels from the district administrative authorities:

for every employee: €1,000 – 10,000
In repeat cases: €2,000 - 20,000.

In the case of more than three affected workers: €2,000 – 20,000 each
In repeat cases: €4,000 - 50,000

Employers or agencies who hire out workers and either notify the authorities too late or incompletely, or deliberately incorrectly, commit an administrative offence which is sanctioned with fines ranging from €1,000 – 10,000 for each worker (in repeat cases from €2,000 – 20,000.

Those who employ these workers and do not keep documentation on the notification of the authorities on file for inspection or make it available commit an administrative offence which is sanctioned with fines from €500 – 5,000 (in repeat cases from €1,000 – 10,000) for every employee.

Obligation of the Hirer to Keep Records and Send Data

Those who use workers hired out to Austria have to keep records on:

  • Names, social insurance numbers, dates of birth, gender and citizenship of the hired-out workers, classified according to blue and white-collar workers;
  • the beginning and end of the hiring period for every hired-out worker;
  • the name and registered office of the respective employer or agency hiring out the workers.
  • In addition, employers or agencies hiring out workers have to send to following data to the service provider commissioned by the Federal Ministry of Labour, Social Affairs, Health and Consumer Protection once a year at the end of July:
  • names, dates of birth, gender, citizenship, blue or white-collar workers;
  • The beginning and end of the hiring period for the individual workers, and
  • the country in which the respective employer or agency hiring out workers has its registered office.

In addition, those who employ workers hired out across borders have to inform them about important aspects of their employment.

The Appointment of Designated Representatives Who Are Responsible According to Administrative Criminal Law

The appointment of representatives who are responsible for adherence to the administrative regulations in relation to the hiring out of workers only becomes legally effective when written notice of the appointment including evidence of the agreement of the appointed person has been received by the Central Coordination Office for the Monitoring of Illegal Employment (in the Federal Ministry of Finance). If the appointment of a representative is revoked or s/he resigns, the agency or employer must inform the Central Coordination Office immediately in writing, otherwise a fine can be imposed.

Which persons can be appointed as representatives responsible for adherence is regulated in more detail in Section 9 of the Administrative Penal Act (Verwaltungsstrafgesetz).

Cross-Border Hiring Out of Workers in Regulated Trades

Cross-border hiring out of workers In accordance with the Commercial Code 1994 (GewO 1994) is conditional on the employer or agency has been authorised to carry out this work in its home country for at least one year during the last ten years or whose professional qualifications have been recognised as being equivalent to a certificate of competence for the respective trade in accordance with Section 373d of the Commercial Code 1994 by the Federal Ministry of Digital and Economic Affairs.

In accordance with Section 373a para.4 of the Commercial Code, those hiring out workers have to notify the Federal Ministry of Digital and Economic Affairs in writing in advance about their cross-border work.

Further Information

Further information on cross-border hiring out of workers and the related obligations on keeping documents on file and notifying the authorities can be obtained from the Posting Platform.

last update: 8 November 2019