The 2nd comprehensive COVID-19-Law - Novelties for the Employer - Taylor Wessing
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The 2nd comprehensive COVID-19-Law –
Novelties for the Employer
On Friday, 20 March 2020, the National Assemply adopted another far-reaching package of measures to
combat COVID-19. We have roughly summarised for you what this entails for employers and employees.
May employers refuse to continue to pay wages?
According to the General Civil Code (ABGB), an employer must continue to pay wages to his employee,
even if the employee does not perform any work but is willing to perform and is only prevented from
working by circumstances on the part of the employer. In order to eliminate a certain legal uncertainty,
the legislator has included "COVID-19-provisions" in the ABGB. Accordingly, COVID-19-measures that
lead to a ban or restrictions on entering operations are considered as such circumstances on the part of
the employer. There is thus an obligation to continue to pay the employees concerned.
The provision enters into force retroactively from 15 March 2020 and - for the time being - remains in
force until 31 December 2020.
If an employee cannot perform his or her work due to the aforementioned COVID-19-measures, but for
other reasons on the part of the employer (e.g. due to a general decline in orders as a result of the crisis),
the employer is already obliged under the previous general provision to continue to pay the remuneration.
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The 2nd comprehensive COVID-19-Law
Novelties for the Employer
Do employers have a right to compensation?
If a restriction or closure of a business is ordered under the Epidemics Act, the employer is entitled to
compensation in accordance with the terms of this Act. In addition, the Crisis Management Fund and the
Hardship Loss Fund were established to support employers. These enable not only companies affected
by (partial) closures by the authorities, but also those who have suffered massive losses for other corona
reasons, to apply for compensation.
Compulsory use of holidays and time off
A consumption of holidays or time off can usually not be ordered. If, however, COVID-19-measures result
in a ban or restriction on entering operations, the employer can now require employees to use up holiday
and time credits if work cannot be performed as a result. However, only two weeks from the current
holiday year need be taken for this purpose; older holidays can be used in their entirety. In total, no more
than eight weeks of holiday and time credits need to be used up. These provisions will enter into force
retroactively as of 15 March 2020 and will remain in force until 31 December 2020.
Corona short-time work
The Corona short-time working model can be used by any company in any industry. Where collective
bargaining agreements exist, these must also be observed.
Requirements:
Company agreement, in companies without works council individual agreements
(= social partner agreement)
Signature by the social partners
Application to the Public Employment Service for short time working assistance
Managing directors subject to ASVG, other executives and apprentices can also be included.
An economic justification is necessary, with a reference to the epidemic and a brief description of the
follow-up measures being sufficient.
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Novelties for the Employer
The social partners have announced that they will sign ready-to-sign agreements within 48 hours. The
short-time working allowance can be applied for retroactively from 1 March 2020.
Duration / Termination:
Short-time work can be agreed for a period of up to 3 months. An extension for up to another 3 months
is possible. The employer can also set the start of short-time work at a later date at short notice or end
short-time work earlier at any time, in both cases without requirement of the consent of the works
council/employee or social partners.
Reduction of working-time:
During the agreed period, normal working hours must be on average at least 10% and at most 90% of
the statutory or collectively prescribed normal working hours (reduced accordingly for part-time
employees) and may also be set differently for employees. It can be reduced to zero during certain periods
(e.g. for a duration of 6 weeks: 5 weeks 0 %, 1 week 60 %). Overtime may only be worked in agreed
areas. Flexitime agreements must be adjusted accordingly.
A change in this average working time is possible in agreement with the works council (in companies
without a works council with the employee). Companies without a works council must inform the social
partners of this at least 5 working days in advance.
Net remuneration guarantee:
The employer must pay the following percentage of the net remuneration which was applicable before
short-time working:
90 % to employees with gross salaries below EUR 1,500
85 % for gross salaries between EUR 1.700 and EUR 2.685 (half maximum contribution
basis)
80 % for gross salaries above EUR 2.685 (also above the maximum contribution basis!)
100 % for apprentices
The basis for the calculation of the aforementioned net remuneration is the average net remuneration of
the last 13 weeks/ 3 months before the start of short-time work. Supplements and surcharges must be
included.
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Novelties for the Employer
The employer must bear the remuneration due for the work performed. The employer receives the
remainder up to 80%, 85% or 90% of the gross remuneration almost entirely from the Public Employment
Service (AMS) in the form of short-time work assistance (up to the maximum contribution basis of
EUR 5,370).
Social security contributions are to be paid on the basis of the remuneration prior to short-time work.
These additional costs on the employer's side are covered by the AMS from the 1 st month of short-time
work.
Holidays, time credits, sick leave, compensation for dismissal:
In the case of vacation, time off and sick leave/absence of service, full remuneration is to be paid as
before the start of short-time work. The AMS does not grant short-time working assistance.
Employees are obliged to use up holiday credits from previous holiday years as well as time credits in
their entirety before the start of or during short-time work if the employer requests them to do so. If short-
time work is extended beyond 3 months, the employer may demand the consumption of a further 3 weeks
of holiday credit from the existing holiday year.
Maintenance of the workforce, dismissals, retention period:
The number of employees in the operation is to be maintained from the beginning of the short-time work
period until one month after its end (retention period). In agreement with the works council/employee and
the social partners, the retention period can be shortened or waived.
Notices of termination for operational reasons may therefore only be given after the retention period has
expired. However, terminations for personal reasons are - as before - possible, as are immediate
dismissals for good cause and amicable dissolutions. In principle, there is an "obligation to replenish".
The use of (not already included) leased employees (temporary workers) or the employment on the basis
of a respective contract for work and labour from the beginning of short-time work is only possible with
the agreement of the works council or with the union if no such council is appointed.
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Novelties for the Employer
Special payments / severance pay:
Special payments (13th and 14th salary) are always to be paid on the basis of the salary before short-time
work, which is also used to calculate the "old" severance payment.
Works councils
Works councils/bodies representing the employees of the company and disabled persons'
representatives whose term of office ends between 16 March 2020 and 30 April 2020 shall remain in
office until the new bodies are constituted. Elections shall be held after 30 April 2020. If the corona crisis
persists, this extension could be prolonged until 31 December 2020.
Suspension of time limits
Contestation of termination / Contestation/Determination according to the Equal Treatment Act
Periods for the contestation of employer's notices of termination by the works council or employees as
well as periods pursuant to the Equal Treatment Act for actions for contestation and declaratory
judgement which run on 16 March 2020 or begin after this date, are suspended until 30 April 2020, so
that they only continue after this date. If the corona crisis continues, these periods could be extended by
decree until 31 December 2020.
Limitation and expiry periods
Statutory, collective bargaining, but also contractual limitation and forfeiture periods with regard to claims
arising from employment relationships are suspended until 30 April 2020 if these periods run on 16 March
2020 or begin to run after this date. If the corona crisis continues, this suspension could be extended by
regulation until 31 December 2020.
Partial retirement
If the employment relationship of a partial retirement employee is terminated as a result of COVID-19-
measures between 15 March 2020 and 30 September 2020, the employment relationship may be
continued with the originally agreed partial retirement at the latest on 1 October 2020. There shall be no
extension of the maximum extent of the partial retirement (maximum of five years or until completion of
the standard retirement age).
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Novelties for the Employer
We are at your disposal for questions, implementations and other concerns around "COVID-19" at any
time!
Your contact persons:
Wolfgang Kapek Brigitte Sammer, LL.M.
Partner, Head of Employment CEE Partner, Employment
Taylor Wessing Vienna Taylor Wessing Vienna
w.kapek@taylorwessing.com b.sammer@taylorwessing.com
© Taylor Wessing 2020, 23 March 2020
This article has been prepared as a general information only. Neither is it intended to provide legal advice, nor can it replace
legal advice. Taylor Wessing assumes no liability of any kind.
TaylorWessing e|n|w|c Natlacen Walderdorff Cancola Rechtsanwälte GmbH, A-1030 Vienna, Schwarzenbergplatz 7
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