Reduction of the employer’s contribution
Reduction of the employer’s contribution to the Austrian Family Burden Equalization Fund adopted as a further measure to cushion the price increase.
Date of application
- The employer’s contribution will be reduced from previously 3.9% to 3.7% starting from the calendar year 2025.
- It is possible to reduce the employer’s contribution already in the years 2023 and 2024, if this reduction is regulated in a “wage-regulating provision”.
The following may be considered a “wage-regulating provision”
- 1. Federal regulations
- 2. Official regulations of local authorities
- 3. Official (remuneration) regulation of corporate entities under public law approved by the supervisory authority
- 4. Work regulation for civil servants stipulated by the Austrian Trade Union Federation (ÖGB)
- 5. Collective bargaining agreement or company agreement concluded based on special legitimations pursuant to collective bargaining agreements.
- 6. Company agreements concluded due to lack of parties authorised to engage in negotiation of collective bargaining agreements on the employers’ side between a single employer and the party authorised to engage in negotiation of collective bargaining agreements on the employees’ side
- 7. Company-internal regulations for all employees or for certain employee groups
Remarks for application
All employers may reduce the employer’s contribution already starting at 01/01/2023 by means of an internal regulation. For example, by an informal internal note:
“Pursuant to section 41 para. 5a subsec. 7 Austrian Family Burden Equalization Fund
the employer’s contribution for all employees for whom the contribution is to be paid
is fixed at 3.7% of the contribution base for the years 2023 and 2024.”
We recommend filing the note with the wage-related documentation for 2023 and 2024 to be able to present the note at any time in case of tax audits.
The FAQs of the Federal Ministry of Labour and Economy on the reduction of the non-wage labour costs clarify that starting with 2023 the reduction of the employer’s contribution to 3.7% may also be applied to independent contractors and managing directors of GmbHs (Austrian limited liability companies) with material participating interests.
