Following the abolition of the continuing education allowance and part-time education allowance in spring 2025, the Ministry of Social Affairs is presenting a new model for labour market policy support. The draft law for the introduction of a „further training allowance“ in 2026 is currently under review and is due to come into force together with new provisions on educational leave and part-time educational leave. The aim of the new regulation is to provide targeted support for people with low qualifications, while at the same time reducing the burden on the budget: instead of around EUR 650 million per year to date, EUR 150 million is now to be spent.
New subsidy instrument for further training
The planned further training allowance replaces the previous further training allowance and is no longer regulated in the Unemployment Insurance Act (AlVG), but in the Labour Market Service Act (AMSG). It will therefore be organised as an allowance without legal entitlement, which will only be granted at the discretion of the AMS.
Requirements for the application
- Duration of employment
- At least 12 months of employment subject to unemployment insurance contributions in the same company before the start of further training.
- For seasonal businesses with fixed-term employment contracts: at least 3 months of employment.
- Special regulation for academicsPersons who have completed a Master's degree or diploma programme must have been employed for at least 208 weeks (four years) before submitting their application, of which the last 12 months must have been spent continuously in the current company.
- Parental leave restrictionPeriods of receipt of maternity or childcare allowance do not count as qualifying periods of employment if they fall within the last 26 weeks before the start of the training programme. It is therefore not possible to receive a continuing education allowance immediately after parental leave.
- Deadline for applicationEarliest possible application: three months before the start of educational leave or part-time educational leave.
- Obligation to provide educational counselling for low-income earnersIf the gross monthly salary is less than 50 % of the ASVG maximum contribution base (expected to be EUR 3,465.00 in 2026), educational counselling is mandatory before the allowance is granted.
Minimum scope of further training
The training measure must fulfil the following requirements:
- Minimum number of hours per week
- Without childcare obligations: at least 20 hours per week
- With childcare obligations (children under 7 years): at least 16 hours per week
- For studies
- At least 20 ECTS per semester
- If caring for children under the age of 7: at least 16 ECTS
Employer subsidy for higher earners
For employees with a current gross income of at least 50 % of the ASVG maximum contribution base (2026: expected to be EUR 3,465.00), the law provides for a mandatory employer subsidy of 15 % of the AMS subsidy granted. This subsidy is:
- directly to the employees,
- not subject to income tax, provided it does not exceed the marginal earnings threshold (note if the allowance is voluntarily higher),
- social security contributions, as all social security contributions are paid by the AMS.
Amount of the training allowance
The continuing education allowance is graduated according to income. The draft law provides for the following minimum and maximum daily amounts for educational leave:
- Minimum amount: EUR 40.40
- Maximum amount: EUR 67.94
These amounts are subject to annual valorisation in accordance with § 108 ASVG. For 2026, an adjustment factor of 1.027 results in an expected payout range of EUR 41.49 to EUR 69.77 per day. For part-time educational leave, the calculation depends on income and the extent of the reduction in hours in the same way as for educational leave.
ImportantThe specific conditions for calculating the amount and duration of the allowance will be set out in an AMS guideline yet to be issued. This will be published on the AMS website.
Labour law changes to educational leave and part-time educational leave
In addition, the draft law provides for new labour law requirements for the agreement of educational leave and partial educational leave:
- Increased minimum period of employment: increase in the required length of service from six to twelve months
- Content requirements for the agreement: In future, educational leave/part-time work agreements must document the current level of education, the planned training programme and the objective of the further training.
- Link to AMS decision: The labour law agreement only comes into force on the day following the award of the benefit by the AMS. Employees are obliged to inform their employer of the decision immediately.
Please note: As before, there is no legal entitlement to educational leave or part-time educational leave. The conclusion of an agreement is still voluntary and requires the agreement of both parties.
The draft law is currently in the review phase. It is expected to be passed in autumn 2025, but changes or adjustments to the regulations are still possible, particularly due to the AMS directive that is yet to be issued.
Status: 30/09/2025
Source: Kraft & Kronberger specialised publications
Photo: Andrea Piacquadio
