Hiring your first employee in Austria: a checklist in seven steps

Before you write a job advert, settle whose name will appear as employer on the contract. A first employee in Austria has to be employed by someone who can register them with social insurance, withhold wage tax and pay the employer levies, and a business with no Austrian presence cannot do any of that on the day it makes an offer.

There are two workable answers. The first is to found your own company, usually a GmbH with at least €10,000 of share capital, and then open the employer accounts it needs. The second is to have an employer of record take the employment onto its payroll while you direct the work. The article comparing an EOR or a GmbH in Austria weighs both in detail; for a single hire the EOR route is usually quicker to put in place because no company has to be formed first.

Whichever you pick, every later step on this checklist still happens. The difference is only who carries it out. Where we write “you” below, read it as “you, or the EOR on your behalf”.

Confirm that the role is an employment before you think about pay. Austrian authorities classify a working relationship by how it operates in practice, so a person who takes your instructions, keeps the hours you set and works inside your team is an employee whatever the paperwork calls them. Engaging your first Austrian person as a freelancer to postpone the payroll question is a common shortcut and a costly one if an audit later reclassifies the arrangement.

The three Austrian contract types are the employment contract (Dienstvertrag), the free service contract (freier Dienstvertrag) and the contract for work (Werkvertrag), and only the first suits someone who will join your team for the long run. If an audit does reclassify the relationship, the bill covers what payroll would have cost from the start: back contributions, wage tax, DB, its surcharge and Kommunalsteuer, with interest and surcharges on top, plus the employee’s own claims to leave and collective agreement pay. That is far more than the effort of employing the person properly from day one.

Our guide to telling a contractor or employee in Austria apart explains the tests auditors apply.

Write a short role profile at this stage: job title, main duties, seniority, weekly hours, and where the person will physically work. Every later decision, from the pay grade to the municipality that collects Kommunalsteuer, depends on those five facts.

Pay is set by the collective agreement first and by negotiation second. No Austrian statute fixes a minimum wage. Instead, more than 800 Kollektivverträge (collective agreements) cover about 98% of employees, and each one fixes minimum salaries by grade. Your first task is to identify which agreement applies to the role and which grade the job falls into; the offer can be higher than that floor but never lower.

As an illustration, the 2026 IT collective agreement puts a skilled professional at grade ST1 on at least €3,267 a month at entry level, which over 14 payments makes €45,738 a year. Our article on minimum pay in Austria walks through how the grades work.

Quote the salary the Austrian way. Pay here is normally expressed as a monthly amount paid 14 times, with the two extra payments, the Urlaubszuschuss paid as a holiday bonus and the Weihnachtsremuneration paid at Christmas, coming from the collective agreement rather than from statute. A candidate offered “€60,000 a year” will translate it straight into 14 × €4,285.71, and a candidate offered €5,000 a month will assume 14 of them unless told otherwise.

Budget the employer side at the same time. On the site’s Vienna reference salary of €60,000 for 2026, the employer pays about €77,805 in total, a 29.7% uplift before any EOR fee.

Once pay is agreed, the terms have to be written down. Austrian law requires a Dienstzettel (written statement of terms) without delay after the start of employment, unless a written contract with the same content is handed over instead. The EU transparency rules, in force in Austria since 28 March 2024, lengthened the list. The statement now has to cover items such as where the employer is seated, what the job involves in brief, how termination works, how overtime and salary are paid, how long probation lasts, and which insurer and which severance fund the employee belongs to.

Several Austrian rules surprise employers drafting their first contract:

• probation (Probezeit) can last one month at most, during which either side may end the contract without notice or reason;
• the first fixed term can be agreed without giving a reason, but a run of renewals has to rest on an objective reason, or the chain becomes open-ended;
• the statutory working week is 40 hours (8 per day), and a collective agreement may shorten it;
• an all-in package covering overtime has to spell out in writing what the base pay for normal hours is;
• a non-compete binds nobody whose final monthly salary is at or below €4,620 gross (2026 threshold);
• annual leave is 30 Werktage, which for a Monday-to-Friday employee means five weeks, fully earned once six months of the first year have passed.

If the person will work from home, add a written telework agreement naming the location. The employment contract in Austria guide covers the drafting points one by one.

Check the right to work as soon as you have a preferred candidate. A candidate holding an EU, EEA or Swiss passport can start without any permit. Anyone else needs a residence title that allows employment, most often the Rot-Weiß-Rot-Karte (Red-White-Red Card) or the EU Blue Card.

The Red-White-Red Card is issued for one employer, and a Blue Card holder can only switch employer freely once 12 months have passed, so the application names whoever will employ the person. For the route covering other key workers, the 2026 salary floor is €3,465 gross a month plus special payments; for the Blue Card it is €55,678 gross a year including special payments. Because no official processing time is published, leave generous room in the start date for a non-EU hire and do not book their first day until the permit is in hand. The Blue Card asks for a degree from a programme lasting three years or more (IT specialists can rely on comparable experience instead) and a job that matches the qualification. After 21 months of work in a 24-month window, a card holder can switch to the plus version of the card, with unrestricted labour-market access. The official portal migration.gv.at sets out each route’s criteria.

The single non-negotiable deadline in hiring is the social insurance registration. It has to be filed electronically through ELDA before the employee starts work; ELDA is the only accepted route, so a letter, an email or a phone call does not count. An unregistered worker found during an inspection costs a €400 contribution surcharge plus €600 for the inspection, and ordinary late reports cost €70 each in 2026.

For a first employee, other registrations sit alongside that one. A new employer needs a tax number and employer account for wage tax, the Dienstgeberbeitrag (DB) and its surcharge, a Kommunalsteuer registration with the municipality of the workplace, and a contract with a Betriebliche Vorsorgekasse that will receive the 1.53% severance contribution from the employee’s second month. Vienna adds one more: the Dienstgeberabgabe, a city levy of €2 for each employee for every week begun. With an EOR these accounts already exist, so only the employee’s own registration is new.

The severance fund choice deserves a moment of attention. The employer selects the Betriebliche Vorsorgekasse, ÖGK collects the 1.53% contribution along with social insurance and forwards it, and the employee’s balance builds up there for as long as they work for you. It is also one of the items the written statement of terms must name, so decide it before the contract is drafted rather than after.

Plan the first day itself as you would anywhere: equipment, accounts, an introduction to the people they will work with. The Austrian part is done once ELDA has confirmed the registration.

Keep a copy of that confirmation with the signed contract and the written statement of terms. Together they form the starting file for this employee, and they are the first documents a payroll auditor asks to see when the joint review comes round.

Hiring does not end with the first day. From the first month, Austrian employment runs on a fixed calendar:

• on the 15th after each pay month: the tax office’s share (wage tax, DB, DZ), the monthly contribution return to ÖGK, and Kommunalsteuer to the municipality;
• twice a year, on the dates the collective agreement sets: the holiday bonus and the Christmas bonus, taxed separately from regular pay;
• by 31 March: the annual Kommunalsteuer return, with Vienna’s weekly-levy return also falling due;
• by the end of February: the Lohnzettel (L16) for each employee, filed through ELDA;
• every three to five years: a joint payroll audit covering wage tax, levies and social insurance together.

Sickness, leave and the end of employment all follow statutory rules too, and it pays to read them before the first case arrives rather than during it. Our guides to the Austrian payroll process and to sick pay in Austria are the natural next reads. Sick pay in particular catches first-time employers out, because in the first year of service an ill employee draws six weeks on full salary from you and four further weeks on half, before ÖGK’s sickness benefit takes over. That cost belongs in the budget from the first month, alongside the five weeks of paid leave.

If you would rather not build any of this for one person, Employer of Record Austria can employ your first hire on an Austrian contract and run the payroll from the first month, from €599 per employee per month. The onboarding sequence shows how the EOR version of these steps unfolds.