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Client employment briefing: Austria, October 2017

  • Austria
  • Employment law


The impact of the General Data Protection Regulation and job creation incentives

Employers and the GDPR

The General Data Protection Regulation (GDPR) will come into force on 25th May 2018 and is accompanied by an amendment to the Data Protection Act in Austria. The Austrian legislation confirms current works council rights regarding the processing of employee data will remain applicable under the GDPR.

While the core principles of data protection legislation will not change, there are several new obligations and duties that employers will have to comply with. For example, the GDPR introduce an obligation upon many employers to appoint a data protection officer (DPO) where, as a data controller or processor, they conduct large scale data processing of special categories of data or undertake regular and systematic monitoring of data subjects on a large scale. The requirement for DPO is likely to apply in the majority of cases. However, it is possible for employers to appoint a group wide data protection officer or outsource this function entirely.

In addition, the GDPR introduces the principles of data protection by design and by default, which have to be accompanied by technical and organisational measures. Such organisational measures include regular data protection training of employees, which should be adapted to specific roles, data access rights and educational history. Data protection policies are already common within many employers but will have increased relevance as an important organisational measure to ensure compliance with data protection legislation. Just as importantly, any such measures are accompanied by a duty to document them, along with any assessments and other actions taken in the context of data protection. The Data Protection Authority may inspect an employer’s records regarding compliance and evidence of its application of data protection legislation in practice.

The GDPR also introduces significantly increased fines of up to 20 million euros or 20% of a group's annual turnover, which is similar to EU competition law fines.

Employment bonus for companies creating new jobs

Changes to the Austrian Business-Service Act were introduced in June 2017 to boost employment. As a result, companies which create new jobs on or after 1 July 2017 are entitled to apply for a subsidy of non-wage labour costs, which is also known as "employment bonus".

The bonus amounts up to 50% of eligible non-wage labour costs, which include sums such as employer contributions for pensions insurance, health/sickness insurance, unemployment insurance, occupational accident and illness insurance, and a number of other statutory contributions. The bonus is payable within one year of the employer's application.

Employers can currently apply for the bonus online despite the fact that consent of the European Commission for this job creation measure is still outstanding. There is also a financial limit to the bonus pot, the subsidy fund financing these incentives being limited to 2 billion euros.