- Income support for workers
Work foundation (outplacement)
Coverage varies depending on the type of work foundation (also: reemployment scheme); in general, this is available to people entitled to unemployment benefits.
A work foundation is usually installed for employees affected by mass redundancies. Different types of foundations exist. Company foundations (Unternehmensstiftungen) are for employees of one company; insolvency foundations (Insolvenzstiftungen) are run by a legal entity in case of the insolvency of a company; regional foundations (Regionalstiftungen) are provided for several companies within a region; and industry foundations (Branchenstiftungen) are provided by employers' statutory interest group in a specific economic sector.
Regarding procedures, the employer and the works council agree on a social plan which offers the workers the possibility to participate in a work foundation (training) course. Following consultation with the social partners, the regional branch of the Public Employment Service (PES) recognises the foundation. Workers can choose to participate in the work foundation course or may opt to benefit from other PES measures. Those who agree to take part in the foundation undergo a substantial profiling process that lasts six weeks. This forms the basis of an individualised training plan which may last for up to four years. Training may include apprenticeship programmes, vocational adult training courses, company internal training, school-based courses and university-based vocational training. Finally, workers are supported in finding a new job or in starting their own business.
During participation, the workers receive 'foundation unemployment benefits' that are equal to standard unemployment benefits (basic amount: 55% of former income). The length of time during which unemployment benefits can usually be obtained (in case of unemployment) is extended when participating in a work foundation (up to 156 weeks, and in case of a longer training course or for persons older than 50 years, up to 209 weeks) (AlVG §18 (5)). Besides the AMS, concerned companies have to provide funding to the work foundation. Furthermore, local labour market actors and the social partners are also involved.
- Regional funds
- National funds
Legal framework; funding.
Public employment services
This involves strong involvement of social partners, employers and PES. The PES pays unemployment benefits for those employees involved in the programme. The duration of receiving benefits is extended.
Employer or employee organisations
This involves strong involvement of social partners, employers and PES.
In some cases employees make contributions (solidarity contribution) to a work foundation, to support colleagues who lost their job. In the case of company foundations the funding is solely funded by employers.
This programme is very successful; one year after the end of the measure (includes all types of work foundation, in this case also implacement foundations) 65% of the participants have a job (2016). In 2016, 4,369 people were supported by outplacement foundations, overall €91,198 was spent (Sozialministerium, 2018). In 2018, a total number of 3,327 people were supported by outplacement foundations. Overall, €73 million have been spent (BMASK, 2019). To note is that there are various types of foundations ('Arbeitsstiftungen'). The budget is the combined sum for all of them, not only the outplacement foundations.
A recent study on the 'Quelle Stiftung' also confirmed positive effects on employment. Almost three out of four participants in retraining by the foundation were able to find a job appropriating their new qualifications (Mitterhumer et al, 2016).
Outplacement foundations enable workers to avoid the stigma associated with dismissal. Social partners are intensively involved at regional and company level. The training leads to a substantial and long-term qualification (including complete requalification for occupational change). This benefits both employees and employers. Participants can choose the qualification they want to obtain. The companies concerned cover some costs of the programme which reduces the amount of public money spent on it. The programme fosters initiative among participants who can also avail of unemployment benefits for a longer period of time than is usually allowed. Finally, employers benefit from 'social peace' - they keep their good image, among their remaining workers as well as on the market.
This programme is expensive. Participation is limited to specific target groups (e.g. only employees entitled to unemployment allowance are eligible).