Austria: Operating a Business

Legal Forms of Companies | The Active Population in Figures | Working Conditions | The Cost of Labor | Management of Human Resources

Legal Forms of Companies

Types of Companies and Capital (Max/Min)	Number of Partners/Shareholders and Liability
Gesellschaft mit beschränkter Haftung (GmbH) is a Private Limited Company. Minimum 35,000€. 50% totally subscribed and released at the creation.	No minimum. Partners' liability is limited to the amount contributed.
Aktiengesellschaft (AG) is a Public Limited Company. Minimum 70,000€. 25% totally subscribed and released at the creation.	No minimum. Partners' liability is limited to the amount contributed.
Offene Handelsgesellschaft (OHG) is a general partnership company. No minimum capital.	Minimum 2 partners. Partners' liability is joint and several for social debts.
Kommanditgesellschaft (KG) is a limited partnership No minimum capital.	Two types of partners: active partners and sleeping partners. Liability of active partners is unlimited. Liability of sleeping partners is limited to the amount contributed.

Enterprises Federation: The Austrian Economic Chambers
Search a Company or a Financial Report: ABN Lookup, available information provided by businesses.
Compnet, Looking for a company (in Deutsch)

Business Setup Procedures

Setting Up a Company	Austria	OECD
Procedures (number)	8.00	5.60
Time (days)	28.00	13.80

Source: Doing Business.

For Further Information: Consult Doing Business Website, to know about procedures to start a Business in Austria.
Austrian Commercial Register
The Competent Organization: Office of the Commercial Register

Recovery Procedures

Principle: Insolvency proceedings in Austria can either be initiated by the involved company itself or a creditor. If the company is insolvent ("Zahlungsunfähigkeit") or its liabilities exceed its assets ("Überschuldung"), the management of a company is responsible to file a petition for insolvency proceedings without delay,
Minimum Debt-to-Capital Ratio Triggering Liquidation: In case not even 20% of the creditors' claims can be satisfied or the creditors do not agree to the composition proceeding, the company's assets will be liquidated and the proceeds will be used to satisfy the creditor's claims.
Bankruptcy Laws: Visit this link.
Reorganization and Rehabilitation Laws: Compulsive composition proceeding: (Zwangsausgleich) 20% of the claims to be settled in 2 years. Composition proceeding (Ausgleich): 40% of the claims to be settled in 2 years.

The Active Population in Figures

	2010
Labor Force	3,700,000

Source: CIA - The world factbook

	2009	2010
Total activity rate	-	60.40%
Men activity rate	68.10%	-
Women activity rate	53.20%	-

Source: UN - United Nations

For Further Statistics: Austrian Statistics
For Further Information About the Labor Market: Federal ministry of Economics and Labour

Working Conditions

Opening Hours
Legal Weekly Duration: 40 hours
Maximum Duration: The statutory maximum working day is 10 hours. However, this may get extended to 12 hours on mutual agreement.
Night Hours: Between 10 p.m. and 5 a.m.

Working Rest Day: 36 hours per week which must include a Sunday.
Paid Annual Vacation: 25 working days annually, and 30 days for employee who has been employed for more than 25 years.
Retirement Age: 60 for women and 65 for men.
Child Labor and Minimum Age For Employment: The minimum age for employment is 15 years.
Informal Labor Market: Very limited.

The Cost of Labor

Pay

Minimum Wage: No legally mandated national minimum wage
Average Wage: 2,117 euros by month (ILO data)
Other Forms of Pay
Pay For Overtime: At least 50% more than regular wages.
Pay For Rest Days Worked: At least 50% more than regular wages, depending on the terms of the employment contract.
Pay For Night Hours: At least 50% more than regular wages.
Pay For Overtime at Night: At least 50% more than regular wages.

Social Security Costs

The Areas Covered: It covers health, occupational and pension insurance. Additional coverage comes under the unemployment insurance system.
Contributions: Contributions Paid By the Employer: Pensions (12.55%), sickness insurance (3.83%), unemployment pay (3%), housing fund (0.5%), severance fund(1.53%).
Contributions Paid By the Employee: Pensions (10.25%), sickness insurance (3.82%), unemployment pay (3%), housing fund (0.5%).
Competent Organization: Association of Austrian Social Insurance Agencies

Management of Human Resources

Recruitment

Recruitment Websites: Monster
Hays

The Contract

Type of Contract: The employment contracts in Austria are regulated by the Employment Contract Law. However terms & types of such contracts are governed by the collective bargaining agreements ("Kollektivvertrag"). A non-EU person needs to obtain a work-permit before entering into an employment contract.

Breach of Contracts
Retirement: Here the employment contract may be terminated by mutual agreement by giving a notice to the employee.
Dismissals: Labour regulations prohibit termination without notice except in some extreme conditions like theft, assault, harassment.
Other Possible Methods: Collective dismissal: In this case the employer has to notify the employment centre.
Labor Laws: Employment contract law

Dispute Settlement

Conciliation Process

Cases of Dispute

Dismissal, harassment, conflict over retirement, etc.

Legal Framework

Mediation is generally used in Austria; governed by ‘Act on Mediation – 2004’.

Procedure

The concerned parties engage a mediator (a trained and neutral intermediary) to enable the parties to solve their conflict on their own account. Such services could be provided only by registered mediators, listed with Ministry of Justice.

The Act on Mediation also establishes an Advisory Board for Mediation at the Ministry of Justice, which consists of about 25 members.

Judicial Structures

Legal Framework: Act on the Procedure in Labor Law and Social Law Matters (Arbeits – und Sozialgerichtsgesetz).
Competent Legal Body: Employment Courts An appeal from the Employment Court may be made to the Regional Court of Appeals (Oberlandesgericht). By way of exception, an appeal can made to the Supreme Court (Oberster Gerichtshof) against a decision made on appeal by the Regional Court of Appeals.

Social Partners

Social Dialogue and Involvement of Social Partners: The law allows the workers to form and join unions. Collective bargaining is protected in law and is freely practiced. Nearly 80% percent of the labor force worked under a collective bargaining agreement. There are nearly 9 national unions which are part of the Austrian Trade Union Federation (OGB)
Unionization Rate: 36% in the year 2007.
Unions: Austrian Trade Union Federation (OGB)
Regulation Bodies: Federal Ministry of Labour & Economic Affairs

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