How to stay compliant

Employer-of-Record (EOR) in Austria: Do You Need One?

Lorem ipsum dolor sit amet, consectetur adipiscing elit. Suspendisse varius enim in eros elementum tristique. Duis cursus, mi quis viverra ornare, eros dolor interdum nulla, ut commodo diam libero vitae erat. Aenean faucibus nibh et justo cursus id rutrum lorem imperdiet. Nunc ut sem vitae risus tristique posuere.

How to stay compliant

Employer-of-Record (EOR) in Austria: Do You Need One?

So you want to hire someone in Austria. Problem is, your company is located somewhere else.

If you’ve done some research, you’ve probably been told you should be using an Employer-of-Record (EOR). Why? Well, if your company isn’t located in Austria, using an EOR can help you bypass the traditional obstacles to hiring full-time employees.

But there’s a catch: EOR solutions in Austria are expensive—usually at least $500 per month per employee—and can take time to set up. And because you’re complying with a different set of labor laws, logistics and benefits can end up costing you lots of time and money. While they will save you time from setting up your own Austrian entity, they’re rarely cheap or fast.

The good news? There’s another way to hire remote workers in Austria, and it doesn’t involve forking out huge amounts of money for an EOR.

The solution: Hire your teammates in Austria as contractors. If you’re hiring remotely and your teammates have autonomy, there’s a good chance you can make compliant contractor hires. You still have to use locally-compliant contracts, but the process is a lot easier, more affordable, and faster.

We built Thera to help you make contractor hires, in 150+ countries (like Austria). So you can hire the people you want on your team, without paying thousands for an EOR. You can get set up in a couple of clicks—and you’ll only pay $49 per contractor per month.

It’s just as easy as it sounds. No catch. Here’s what Thera looks like vs. an EOR in Austria:

Everything you should know about using an EOR in Austria

Are you considering hiring independent contractors abroad or expanding your business to Austria? If so, you may have heard of the term "EOR" or "Employer of Record." An EOR is a third-party company that acts as the legal employer of your workers, handling payroll, taxes, and compliance on your behalf. In this post, we'll break down everything you need to know about using an EOR in Austria, including legal and regulatory conditions specific to the country. We'll also make the case for why hiring independent contractors might be easier than using an EOR in certain situations.

Legal and regulatory conditions in Austria

Austria has a complex set of labor laws and regulations that can make it challenging for foreign companies to navigate. For example, employers are required to provide a minimum of 25 days of paid vacation per year, and employees must be paid a 13th and 14th month of salary as a bonus(yes, really). Additionally, employers must contribute to social security and pension funds, and failure to comply with these regulations can result in hefty fines and legal consequences.

Using an EOR in Austria can help alleviate some of these compliance burdens, as the EOR will handle all payroll and tax obligations on your behalf. However, it's important to note that the EOR will also be responsible for ensuring compliance with all Austrian labor laws and regulations, which can be complex and time-consuming.

Should you hire contractors instead of using an EOR?

In some cases, hiring independent contractors in Austria may be a simpler and more cost-effective solution than using an EOR. For one, you won’t have to pay that 13th and 14th salary bonus.

Plus, independent contractors are not considered employees, so they are not subject to the same labor laws and regulations as traditional employees. This can make it easier for foreign companies to hire and manage workers in Austria, as they can avoid the compliance burdens associated with traditional employment.

However, it's important to note that there are strict criteria for determining whether a worker is considered an independent contractor or an employee in Austria. If a worker is found to be misclassified as an independent contractor when they should be considered an employee, the employer can face significant legal and financial consequences.

But what if I accidentally misclassify my contractors?

We’ve got two pieces of good news for you. For one, if you’re hiring remotely, it’s unlikely you’ll misclassify your contractors. Many of the things that qualify people as employees, such as company equipment and set working hours, don’t typically apply to remote work.

Still, it’s helpful to have the comfort of knowing you’re not at risk for misclassification. That’s why, at Thera, we’ve launched Misclassification Assurance: so you can hire contractors abroad, worry-free. Learn more about hiring with Thera below.

Hiring contractors? Thera can save you a ton of time

If you’re hiring contractors, you’re probably spending too much time on their payroll, contracts, and tax documents. Which is why we built Thera, which saves you 90% the time you spend on contractor paperwork each month.

With Thera, you can compliantly hire your contractors in 150+ countries, onboard them in minutes, and pay them all at once (in a click). It’s global contractor payroll, finally simplified.

Sound interesting? Click here to book a demo and see the platform firsthand

Run your global workforce on autopilot with Thera

Book a demo to get started.