Author Caroline Forster HR Manager, Service Line Manager HR and Payroll Accounting

Update 03/09/2025

New legal regulation for employee notice periods from 2026

According to a draft assessment by the Ministry of Social Affairs, the statutory notice periods and deadlines for workers will be reorganised with effect from 1 January 2026:
The statutory authorisation of the collective bargaining partners to regulate the notice periods differently for predominantly seasonal industries („seasonal privilege“).“ pursuant to § 1159 para. 2 last sentence ABGB) is to be removed from the law with effect from 1 January 2026. The background to this is the well-known problem of interpreting the seasonal clause.

The planned revision of Section 1159 para. 2 ABGB provides for a notice period of six weeks for employer terminations from 2026, as before, and an increase to up to five months depending on the year of service (the termination date remains the end of the quarter or the 15th and/or last day of the calendar month can also be agreed).

What is new is that the authorisation of the collective bargaining partners to regulate deviating provisions for seasonal industries has been removed. However, an exemption provision is intended to ensure that those special collective agreement regulations that were previously explicitly based on the seasonal clause can remain in place:

Deviating collective agreement termination provisions remain valid if they were concluded and announced in the period from 1 January 2018 to 1 February 2025 with reference to Section 1159 (2) ABGB (in the previous version) (Section 1159 (3a) ABGB). Accordingly, the parties to the collective agreement must actively conclude a new agreement (plus publication) within the aforementioned time window.

Conversely, this means that, on the one hand, simply maintaining a collective agreement termination provision that already existed before 1 January 2018 is not sufficient. On the other hand, collective agreements that were or will only be concluded after 1 February 2025 may no longer deviate from the termination provision of Section 1159 ABGB from 1 January 2026, even if they enter into force retroactively.

Practical orientation guideThe explanatory notes to the draft bill list the collective agreements that fulfil the requirements for the continued application of the deviating termination provisions:

  • KV workers in the agricultural service industry,
  • Construction industry and building trade,
  • KV building trade,
  • KV security guards in the security industry,
  • KV floor laying trade,
  • KV well master, foundation engineering and deep drilling contractor,
  • KV roofing trade,
  • Combined cleaning of monuments, facades and buildings, other cleaning services and housekeeping,
  • KV Eisen- und Metallverarbeitendes Gewerbe for the trades of tinsmiths (plumbers and coppersmiths),
  • KV Commercial forestry companies,
  • KV glazier trade,
  • KV commercial cemetery gardening companies,
  • KV Commercial gardening and landscaping companies,
  • KV Hafner-, Platten- und Fliesenlegergewerbe und Keramikergewerbe,
  • KV timber construction master craftsman,
  • KV painters, varnishers and sign makers,
  • KV paving trade,
  • Supplementary contract for chimney sweeps,
  • KV Pest Control,
  • KV stone workers' trade,
  • KV upholsterer trade,
  • KV Holz- und kunststoffverarbeitendes Gewerbe in the version applicable to carpenters and wood designers,
  • KV Private bus companies,
  • CT inland navigation,
  • KV cable cars,
  • CT freight transport industry,
  • CT small transport industry,
  • KV stone and ceramics industry,
  • KV glass working and processing, flat glass grinding.

Update 01.08.2024

The Constitutional Court has ruled on the issue: The supreme judges have ruled that the statutory worker dismissal regulation is constitutional and therefore remains in full force and effect (Constitutional Court 25 June 2024, G-29/2024). The Constitutional Court does not see any violation of the principle of legality or the principle of equality in the seasonal privilege, which allows the parties to the collective labour agreement to allow shorter notice periods in industries with predominantly seasonal operations.

However, since it is still unclear who bears the burden of proof for the classification as a predominantly seasonal industry, which entails the applicability of the shortened notice period, it must still be recommended in the hotel and catering industry to „switch to amicable termination“ in the event of a planned termination of employment relationships. If this is not possible due to the employee's lack of consent, the statutory notice period (on the intended termination date) should be applied as a precaution.

Status April 2024

As already reported, since 1 October 2021, the same statutory notice periods and notice periods apply to blue-collar workers as to white-collar workers, i.e. six weeks to five months, depending on the length of service. The employment relationship must end at the end of the quarter or - if provided for in the collective labour agreement, the employment contract or a works agreement - can also end on the 15th or last day of the month. However, shorter notice periods can still be regulated via the collective labour agreement for sectors in which seasonal operations predominate throughout Austria („seasonal privilege“). This provision has caused uncertainty for years, particularly in the hotel and catering industry. Two decisions by the Supreme Court have not yet provided any clarification, despite the best endeavours of the Supreme Court judges.

But now there are new developments: The Supreme Court considers the provision of Section 1159 ABGB to be unconstitutional and has therefore filed an application with the Constitutional Court for cancellation. The Supreme Court's concerns are based on the fact that the current legal regulation is contrary to the rule of law and the principle of equality.

This highlights the difficulties for operational practice in human resources. Not only the hotel and catering industry is affected, but also many other sectors. It could possibly affect those sectors in which the parties to the collective labour agreement had already agreed to apply the seasonal privilege (construction, construction industry, goods transport, plumbers, etc.).

Depending on the final decision of the Constitutional Court, various scenarios are conceivable for the future:

  1. Cancellation of the entire termination provision of Section 1159 ABGB: All sectors are threatened with a return to the old legal situation. This would mean that a statutory notice period of 14 days would once again apply to workers (on both the company and employee side). In this case, the legislator would probably be forced to react quickly with a new regulation.
  2. Cancellation (only) of the seasonal privilege contained in § 1159 ABGBThis would bring about the same legal situation for dismissals of blue-collar workers as for white-collar workers in all sectors. Deteriorations in collective agreements to the detriment of workers would then no longer be permitted compared to the law (with the exception of the establishment of the 15th and last day of the month as the termination date for employers). The competence of the parties to the collective agreement to determine deviating termination regulations for seasonal industries would be abolished without replacement, which would also render all collective agreement regulations based on it (e.g. construction industry, goods transport industry, plumbers, etc.) ineffective.
  3. Rejection of the application by the Constitutional CourtThis would result in the continued application of Section 1159 ABGB including the seasonal privilege. All sectors in which this is applicable could breathe a sigh of relief. For sectors in which the applicability of the seasonal privilege is disputed (in particular for the hotel and catering industry), on the other hand, this would mean the continuation of legal uncertainty regarding the dismissal of workers until „the day after tomorrow“.

Experts expect a decision by the Constitutional Court in autumn 2024.

If, in the meantime, the termination of an employee's employment is pending, the following is recommended:

  • In sectors in which the seasonal privilege is affirmed by the parties to the collective agreement (e.g. construction industry, goods transport industry, plumbers, etc.), employers can apply the collective agreement cancellation regulations without major risk until the Constitutional Court's decision. It is considered unlikely that the Constitutional Court's decision - whatever its content - will have to be implemented retroactively.
  • In those sectors in which the applicability of the seasonal privilege is disputed (particularly in the hotel and catering industry), attempts should be made to reach mutually agreed cancellations. If this is not possible in individual cases due to a lack of employee consent, it is advisable until further notice to give notice of termination in compliance with the statutory notice period on a legally permissible termination date (in particular to avoid the risk of termination compensation).

Status: 03/09/2025
Created: 30.04.2024
Source: Kraft & Kronberger specialised publications
Image: Pexels - Andrea Piacquadio