Austria: Latest working life developments – Q2 2016

Personnel changes and new economic policies at federal level, the integration of refugees, entitlements to education and child support, and the results of collective bargaining are the main topics of interest in this article. This country update reports on the latest developments in working life in Austria in the second quarter of 2016.

Personnel and policy changes at federal government level

Christian Kern, former head of Austrian Railways and now leader of the Social Democratic Party (SPÖ), has been appointed federal chancellor following the resignation of the former chancellor Werner Faymann. Alongside the appointment of Mr Kern, new ministers for education and infrastructure, as well as new secretaries of state – for diversity, public services and digitalisation, and government coordination – were installed on 17 May.

Mr Kern has proposed a ‘new deal’ designed to boost the economy and create jobs. Together with vice-chancellor Reinhold Mitterlehner of the Conservative People’s Party (ÖVP), he presented five priorities to be tackled in the coming weeks and months.

The vice-chancellor has demanded a radical re-orientation of the social partners’ role. This was met with heavy criticism from the social partners, who stated that they would present solutions and suggestions on various measures that the government had not yet implemented.

Rights of refugees

The social partners issued a joint position paper on the integration of refugees at the government’s refugee summit in late April. The government has not yet responded. Mr Kern, whose approach to the refugee situation is of great interest, has shown a slight preference for opening the labour market sooner to asylum-seekers.

In Upper Austria, the means-based minimum income scheme – a social benefit for those in need, which is administered by the provinces – has been reduced for recognised refugees as of 1 July 2016.

Child allowance and education commitments

At federal level, the child allowance for parents of young children has been made more flexible, with a fixed sum to be paid over a freely chosen period of time, within certain limits. This change is due to be implemented on 1 March 2017.

An obligation to provide education or training up to the age of 18 has been adopted by the Council of Ministers and is waiting to be approved by parliament. This measure is due to be implemented in the school year 2017–2018.

Collective bargaining

Moderate wage increases

Moderate wage increases of between 1.3% and 1.5% were agreed in the second quarter of 2016, continuing the trend of the two previous quarters. In the electrical and electronics sector, which has 50,000 employees, the minimum income is now €1,715.96 gross per month. In the hotel and restaurants sector, which has around 200,000 employees, it is now €1,420 gross per month.

Unions have demanded a minimum wage of €1,700 (equivalent to two-thirds of the median income) to be implemented in sectoral wage agreements. A recently published study from Statistics Austria shows that the incomes of 344,000 full-time working employees are still below this mark and that 244,000 full-time working employees earn less than €1,500 gross per month.

Conflicts in the haulage and logistics sector

Collective bargaining In the haulage and logistics sector has been conflictual, and works meetings had to be held before an agreement could be reached. The main point of discussion was the employers’ demands to soften restrictions on working during civic holiday rest periods. A one-year agreement was finally reached, making a works agreement binding to allow for holiday work. The agreement permits employees to refuse to work and applies only to those employees engaged in planning and arranging the processing of customer transactions in international traffic.

Flexible working time for metalworkers

A new working time model that allows greater flexibility is due to be implemented in the metalworking sector on 1 July 2016. The model was negotiated by the sectoral social partners in autumn 2015, and the contractual details have been developed over the past few months.

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