COVID-19 HR/Labor Law - Current updates regarding short-time work (phase 3), special care period, risk groups, etc.
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Our Firm News Expertise
COVID-19 HR/Labor Law
Current updates regarding short-time work
(phase 3), special care period, risk groups, etc.
Dear esteemed readers,
We hope you are well and were able to enjoy the summer despite Covid-19. As you probably know, over the sum-
mer the Corona short-time work program (now in "Phase 3") was extended, effective October 1, 2020. They also
changed the way the subsidies are calculated. In September the Covid-19 Measures Act was amended and legally
"reorganized".
Here are the most important updates:
1
1. Corona short-time work extended (Phase 3)
Corona short-time work was initially extended until September 30, 2020. In August, lawmakers decided to extend the Co-
rona short-time work program for another six months, from October 1, 2020 to March 31, 2021. The averaging period
is now six months. As before, early termination is possible at any time. According to the Austrian Chamber of Commerce
(WKO), sectors that have been particularly affected may get an extension past March 31, 2021. As a result, two new social
partner agreements (1x as a company agreement, 1x as an individual agreement - both as compare versions) have been
published. Aslo an amended short-time work guideline (compare version) concerning the new regulations in Phase 3 has
been published.
Key aspects of Phase 3 Corona short-time work:
• As before, employees will receive 80/85/90% of the net salary they received before short-time work was imple-
mented; apprentices will receive 100% of their previous net salary. In any case, the employer must pay the employee
the minimum monthly gross salary that is shown in the table of minimum gross remuneration for short-time work
published by the BMAFJ. As soon as the gross remuneration agreed in the employment contract for the working time
actually worked exceeds the gross remuneration resulting from the net replacement rate, the gross remuneration for
the working time actually worked is due in that month.
What is new is that wage increases such as collective bargaining agreements increases to a small extent (up to
5%) will also be taken into account under state aid law ("dynamic consideration"). This means that you as an emp-
loyer will not have to "absorb" all wage increases.
In addition, overtime lump sums ("Überstundenpauschalen") not revoked at the start of short-time work can now be
included in the basis for calculating the net salary.
• Starting October 1, 2020, working hours must average 30% to 80% of normal weekly working hours. Conversely, this
results in a possible loss of working hours (which can be subsidized by the AMS) of between 20% and 70% of normal
weekly working hours. In special cases, the working time can be reduced below 30% with the agreement of the social
partners (the WKO refers to the city hotel industry as an example). In this context, Supplement 2 of the social partner
agreement must also be filled out and send to the AMS. In these cases, however, approval by the AMS is only permitted
if there is positive feedback from the WKO and the Austrian Trade Union Federation (ÖGB).
• As before, employees must be retained for at least one month after short-time work ends, and cannot be dismissed
during this time. With the consent of the works council/union or, secondarily, with the consent of the AMS regional
office exceptions can be made.
• If an employer offers job skills training during non-working hours, employees can be required to attend. The company
should coordinate the trainings with AMS. The company can interrupt the training if necessary; however, the employee
should have a legal right to complete the training within 18 months. Periods of job skills training are regarded as lost
hours ("Ausfallstunden") and are taken into account when calculating the short-time working allowance.
• Apprenticeship training has to be guaranteed during short-time work. Short-time work is only possible for apprentices
if at least 50% of the lost hours is used for job skills training or job-related measures over the entire short-time
work period. If the reduction in working hours is more than 20% on average over the entire short-time work period, an
implementation report must be submitted at the end of the short-time work period to show which specific measures
have been taken per apprentice and to what extent.
2
• The approval procedure will continue to be bureaucratically streamlined. The WKO grants general approval and the ÖGB
has a right to object. In Phase 3, a standardized procedure will be used to asses the extent to which a business
has been financially affected by the crisis, in order to prevent fraud. The company must demonstrate the financial
need for the subsidy (including information on the monthly turnover), provide evidence of the actual financial situation,
and present a forecast for the duration of short-time work. If an employer puts six or more employees on short-ti-
me work, a tax consultant has to confirm the plausibility of this data.
• Besides that, the employer must aim seriously at the reduction of old vacation claims. If old vacations and time cre-
dits have already been taken, a week of the current vacation claim within the short-time work period is to be consumed
(if available).
• Until October 31, 2020 it is possible to file applications with retroactive effect to October 1, 2020.
3
2. Changes to how the short-time work subsidy is calculated
Effective retroactively, for projects starting on or after June 1, 2020, the subsidy will no longer be a flat-rate, but rather
calculated using a "difference method". In essence, the short-time work subsidy is limited to making up the difference bet-
ween what the employer pays and the minimum gross remuneration. The minimum gross remuneration (BMAFJ table of
minimum gross remuneration for short-time work), minus the remuneration for hours actually worked ("Arbeitsentgelt")
and compensation for absence that is subsidized by the state ("Stunden mit Entgeltfortzahlungs- und Ersatzleistungs-
ansprüchen"; e.g. sick leave, maternity, etc.) equals the amount of the short-time work subsidy. If the remuneration for hours
actually worked is higher than the minimum gross remuneration, there may be no subsidy at all. In practice, this means
the short-time work subsidy may be significantly reduced, or even denied, for higher earning employees with higher actual
working hours (e.g. 80%). The difference method will also be used in Phase 3.
In addition, there will be a cost reimbursement for pro rata special payments and eligible social security expenses up to gross
salaries of EUR 5,370.00.
Example: short-time work subsidy for high-income employees:
See column number 3 below. The employee normally earns EUR 10,000.00 gross per month. They would normally work
40 hours per week, which is 176 hours per month. In June 2020, they actually worked 88 hours (= 50%). In this case, the
remuneration to be paid by the employer is calculated as follows:
10,000.00 (the normal gross pay) / 176 (the normal hours per month) * 88 (hours actually worked by the employee that are
to be paid by the employer) = EUR 5,000.00 gross.
Since this exceeds even the highest minimum gross remuneration of EUR 4,041.29, the employer is not entitled to a short-
time work subsidy from the AMS.
Below you will find a chart showing some examples using the difference method:
Employee 1 2 3 4 5
Normal gross salary 1.510,00 5.370,00 10.000,00 10.000,00 12.000,00
Minimum gross remuneration (per month) 1.314,89 4.041,29 4.041,29 4.041,29 4.041,29
Normal hrs./week 40 40 40 40 40
Normal hrs./month1 176 176 176 176 176
Hours actually worked 105 135 88 70 70
Hours not worked under short-time work 71 41 88 106 106
Remuneration from employer 900,85 4.119,03 5.000,00 3.977,27 4.772,72
Short-time work subsidy 414,04 0,00 0,00 64,02 0,00
Gross income 1.314,89 4.119,03 5.000,00 4.041,29 4.772,72
1 set by collective agreement or contract
43. Special care extended
If institutions - such as schools and kindergartens - are partially or completely closed by official measures, and an emp-
loyee is not entitled to time off work to care for their child, the employer can voluntarily grant the employee a special care
period of up to three weeks. This applies from the time of the official closure, for the care of children up to the completed
14th year of age, for whom there is a legal duty to care. Relatives of persons in need of care, or with disabilities legally
requiring care, also qualify.
The great advantage for employers is that the federal government will compensate part of the salary they pay to the
employee during this special care period. Until now, that amount has been one-third. The compensation is capped at the
maximum monthly contribution basis (2020: EUR 5,370 gross / month).
The special care program was initially authorized up to September 30, 2020. On September 23, 2020, the government ex-
tended it until February 28, 2021. The employer may grant special care periods of up to three weeks, even for employees
who already benefited from this program. Starting in October, the government will compensate half of the employee's
wage / salary, instead of only one-third. As before, the employee does not have a legal entitlement to special care
period.
4. Changes to the COVID-19 Measures Act
In addition to the special care period, the National Council passed further amendments to the COVID-19 Measures Act on
September 23, 2020. The Federal Council approved the changes on September 25, 2020. Here are the main changes:
• By decree, and taking into account the epidemiological situation, the government can restrict entry and travel to
places of work/business premises, certain places, and public places, generally or individually (e.g. by conditions), or
completely prohibit it.
The Minister of Health is primarily responsible for imposing these measures. Provincial governors and district admi-
nistrative authorities may also issue such decrees, if the Minister of Health has not acted, or they wish to take additional
measures.
• The consequences for violating these restrictions are severe. Anyone who enters a business premises or place of work
in violation of the ban may be fined up to 1,450 euros. Owners of such premises who fail to keep people out may be
fined up to 30,000 euros.
• The government can also issue orders to stay at home. People will still be allowed to leave the private living area to: (i)
avert immediate danger to life, limb, and property, (ii) provide care for others and fulfill family duties, (iii) meet basic
needs of daily life, (iv) work, and (v) go outdoors for physical recreation and mental well-being.
• If the government puts restrictions on going to work under § 3 COVID-19 Measures Act, there will be no legal claim to
compensation for wages / salaries under the Epidemic Law during that time.
55. Further clarifications and advice
• Fixing billing errors for short-time work
According to the AMS website, in the event of billing errors, the corrected CSV file should be sent as a project-related
message via eAMS account, including an explanation of the change to be made (bills for subsequent months should not
be changed). AMS will then process the corrected file as part of the check for proper use.
• Strategic considerations for personnel restructuring
Employers must naturally balance the pros and cons of taking the short-time work subsidy. The benefit of salary com-
pensation must be weighed against the restrictions on termination, including the obligation to retain employees for 1
month after ending short-time work, and the obligation to maintain the same number of employees as before taking
the short-time work subsidy.
When determining if you can terminate an employee without refilling the position, you must consult the application
for short-time work, and what was stated concerning how many employees you had before. If the total number of
employees was listed on the application, terminations may be more difficult. If an employer is planning to reduce
personnel in the future, they must consider this when determining whether or not to extend short-time work.
• Guide to payroll accounting
At the end of July 2020, the BMAFJ published a guideline on payroll accounting for short-time work, which contains
examples and special questions, e.g. in the case of part-time work for older employees.
• Corona Benefits
With Federal Law Gazette I No. 103/2020,"Corona Benefits" were also exempted from municipal tax and the employ-
er›s contribution to the Family Burden Equalization Act (as well as the surcharge on the employer›s contribution: "DZ").
The exemption went into effect on September 17, 2020.
• Correctly adding new hires to grant applications
An employee must work for one full calendar month with full pay before becoming eligible for short-time work.
If no subsidy can be granted to persons who do not receive a full monthly salary in the month of assessment, the em-
ployer can submit a separate request for these employees with a correspondingly modified short-time work start date.
• Risk groups – Leave of absence program extended
The regulations for putting at-risk employees on leave have been provisionally extended until December 31, 2020. As
you surely know, employees who have a very high risk of serious illness are entitled to work at home or workplace
accommodations. If this is not possible, there is ultimately a right to a temporary leave of absence. The employer is
entitled to reimbursement of the continued remuneration.
• Home office - Mandatory or voluntary
In the wake of the rising number of infections, the federal government held a press conference to expressly recom-
mend home office again. However, they did not state that it is mandatory. To date, no law has been passed that would
standardize such an obligation for companies. The employer is therefore still free to have its employees work in the
office - if possible. The important aspect here is to have a clear home office policy (e.g. regarding reimbursement of
costs, data protection, revocability, remote access issues, etc.).
6We hope this update is helpful. If you have any questions, please do not hesitate to contact us at any time!
Best regards,
Jana Eichmeyer & Karolin Andréewitch
Further Links
1. Beschluss EpiG und COVID-19-MG
2. Beschluss ASVG
3. Beschluss AIVG
4. Beschluss AVRAG
The information, opinions and legal views in this article are not intended to be comprehensive and in any case cannot replace an individual examination based on the special
circumstances.
No liability is accepted for the content of this article.
Dr. Jana Eichmeyer Dr. Karolin Andréewitch
Partnerin Lawyer
+43 676 836 47 307 +43 676 836 47 308
j.eichmeyer@ehlaw.at k.andreewitch@ehlaw.at
Wienerbergstraße 11, 1100 Wien | Österreich | T: +43 1 606 36 47, F: +43 1 606 36 47-58 |
office@ehlaw.at | www.ehlaw.at
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