Article:

Change in notice periods: We recommend contract adjustments

30 September 2021

As of 1 October 2021, the harmonisation of the notice periods and termination dates of blue-collar workers with those of white-collar workers, which was already decided in 2018, will come into force. This will result in a considerable extension of the previously applicable notice periods when terminating an employment relationship with blue-collar workers.

The new regulations apply to all notices of termination issued on or after 1 October 2021. Notices of termination given prior to this date - even if the employment relationship ends after 1 October 2021 - are not covered by the new regulations. The old legal situation applies to notices of termination given by 30 September 2020.

 

New regulations for employer dismissal

As of 1 October 2021, the following notice periods will apply:

Duration of employment Notice period
1st and 2nd year of service 6 weeks
3rd to 5th year of service 2 months
6th to 15th year of service 3 months
16 to 25 years of service 4 months
More than 25 years of service 5 months


Furthermore, the legally standardized termination dates (end of quarter) are

  • 31 March,
  • 30 June,
  • 30 September or
  • 31 December.

This means that the employer must take into account not only the much longer notice periods, but also the possible dates of termination, if they wish to terminate the employment of a worker. 


Employee dismissal

The periods and dates of notice are also aligned in the context of an employee's notice of termination. Employees can terminate the employment relationship

  • with the last day of a calendar month
  • terminate the contract with one month's notice.

 

Agreements in individual collective agreements

Collective agreements (CA) can stipulate different regulations for both employers and employees in certain sectors - for example, in tourism businesses, the construction industry and other seasonal businesses. Some collective agreements already contain specific regulations, some also provide that the old regulations should continue to apply in full or only for certain sub-sectors.

  • CA Construction
    The KV partners have agreed that the previous (i.e. old) termination regulations will continue to apply ("seasonal clause").
  • CA Gastronomy
    The CT partners have not yet been able to agree on the extent to which catering is considered to be a seasonal business; there is no agreement to this effect to date.
  • CA trade
    In the trade sector, a "supplementary collective agreement for trade workers concerning the postponement of notice periods" has been concluded, which contains the following provisions:

    For employer notices of termination given after 30 September 2021, it shall be deemed agreed that the employment relationship of indefinite duration may be terminated by the employer with prior observance of the statutory notice period on any fifteenth or last day of a calendar month. The employee may terminate his/her employment relationship on the fifteenth or the last day of a calendar month by giving one month's notice. 
  • CA Metalworking industry
    An explicit provision was also made by the KV partners for this sector:

    After the entry into force of § 1159 ABGB in the version of the Federal Act, Federal Law Gazette I No. 153/2017, it shall be deemed agreed pursuant to § 1159 para. 3 ABGB that the employment relationship of indefinite duration may be terminated by the employer after the expiry of the probationary period in compliance with the statutory notice periods on each 15th and last day of the month.

    The employee notice periods continue to be (at the end of the working week) as of the entry into force of the amendments to Section 1159 ABGB:
     
    Length of service Notice period
    4 weeks 1 week
    1 year 2 weeks
    5 years 4 weeks
    10 years 6 weeks

    Exception: Plumbers (tinsmiths and coppersmiths) are considered a seasonal industry. The previous (thus former) deadlines therefore continue to apply for them.

 

 

Relevance and handling in practice 


Step 1: Look at the applicable collective agreement

As described, some CA partners made use of their right to provide for additional or different regulations with regard to notice periods and dates.

  • PRACTICETIP: It is therefore essential to observe the provisions of the relevant collective agreement!  

 

Step 2: Contract adjustments

If the new longer notice periods and dates are not taken into account when giving notice of termination, but the old legal situation continues to apply, workers are entitled to compensation for termination in accordance with the new regulations. In addition, workers are no longer obliged to work after the expiry of this period.

  • The new notice periods and dates apply from 1 October 2021; other agreements in the employment contract are not permitted (e.g. continued application of the old periods by mutual agreement). In order to avoiding problems in practice (termination compensation in the event of non-compliance with the new legal framework conditions), it would be advisable to adapt not only the new, but also the old employment contracts.
  • PRACTICE TIP for the termination by the employer: We recommend already now - as is quite common for salaried employees - to make use of the legal possibility to agree on the 15th and the last of a calendar month as termination date for new, but also existing employment contracts of workers (unless the collective agreement already provides for this or does not regulate anything to the contrary). Thus, a total of 24 termination will be available in the event of termination.
  • PRACTICE TIP for the employee's notice of termination: Although the notice period cannot be shortened, it can be extended by agreement up to six months (unless the collective agreement already provides for this or regulates something to the contrary). However, the period of notice to be observed by the employer may not be shorter than the period of notice agreed with the employees.

Attention: Freelancers

According to case law and jurisprudence, the termination rules in the ABGB apply analogously to freelance employment relationships. Accordingly, compliance with the new notice periods and deadlines is of utmost relevance not only for the termination of workers, but also for the termination of freelancers.