Austria: The 2021 Legislative Package To Govern Working From Home ("Home Office")

With the onset of the COVID-19 crisis, working from home has become a prevailing mode of employment. The long-awaited package of measures for home office 2021 has introduced notable amendments in labour law and tax law.

According to the statutory definition, "home office" means that an employee regularly works from his/ her own home (Section 2h (1) of the Act Governing Amendments to Employment Law (AVRAG)). According to the legislative procedural records, "home" includes a residential building, a secondary residence, or the home (house) of a near relative. Consequently, the new regulations do not apply to other types of mobile working, e.g. in a public coworking space. Such flexible types of work may certainly be agreed on but will not be governed by the regulations of the new package.

Remote working continues to be subject to mutual consent

Even before the new arrangements entered into force, remote working has always required an agreement between employer and employee. Section 2h (2) AVRAG specifically stipulates that remote working must be agreed on in writing "for documentary purposes". According to the legislative procedural records, agreeing to a unilateral reservation of instruction on the part of the employer (i.e. the employer's right to unilaterally order an employee to work from home) is not permissible. However, since this restriction is not found in the actual law, it must still be possible to have unilateral instructions to work from home temporarily considering the mutual duty of care and loyalty, at least in special exceptional cases such as granting leave of absence to high-risk groups, for quarantine or in the event of an urgent health recommendation (e.g. a possible fourth wave of the pandemic in autumn).

According to the legislative procedural records, the lack of a written (signed) agreement does not cause such agreement to be void; an agreement may also be achieved electronically (e.g. by email).

The digital tools required for regular work from home (laptop, mobile phone, data link) must be provided by the employer (Section 2h (3) AVRAG). The parties may agree to depart from this rule, provided that the employer bears the reasonable and necessary costs of the digital tools made available by the employee; such costs may be recompensed as a lump-sum.

For important reason, a remote-working agreement may be cancelled at a month's notice on the last day of any calendar month (Section 2h (4) AVRAG). Irrespective of this option, the parties may agree time limits and provisions for (ordinary) termination of employment. Mutually agreed termination is possible at any time.

Voluntary works council agreement

In Section 97 (1) no. 27 of the Austrian Labour Constitution Act ArbVG, the legislative package also introduces a specific works council agreement ("framework regulations for working from home") which provides the prerequisites for detailed regulations at company's level (provision of working tools, rules for cost remuneration, etc.). Such works council agreements may be used as a basis for the individual agreements which are always required.

Accidents at work

The Third COVID-19 Act has already come up with special temporary rules regarding accidents sustained at work. They are now adapted and made permanent: accidents at work now include accidents that occur at home in a temporal and direct context of the insured employment relationship (Section 175 (1a) of the Austrian General Social Security Act ASVG). By equalling the place of abode with the place of work in Section 175 (1b) ASVG, coverage now includes certain en-route accidents.

Furthermore, Section 2 (4) of the Austrian Act Governing Liability of Employees (DHG) stipulates that the provisions of this act must apply when the employer sustains damage from persons living in the employee's household in connection with such employee working from home.

Working from home and taxation

The tax side of the package governing remote working was regulated in the Second COVID-19 Tax Act with a view to compensating employees for the higher costs of working from home.

It stipulates that the value of the digital tools provided for free by the employer to the employee for the latter's work, as well as a lump-sum allowance for remote working granted by the employer are not taxable (and not subject to social insurance contributions). The lump-sum allowance is, at most, EUR 3 for each day that the employee works solely from home; it is payable for not more than 100 days per calendar year. A lumpsum allowance exceeding EUR 300 per calendar year is deemed to be remuneration for work and subject to taxation and social security contributions. When the lump-sum allowance is less than the maximum of EUR 3 per day of working from home, the employee may assert the difference for each day of actually working from home (within the limit of 100 days) as lump-sum allowance for promotion expenses in his/ her tax return. The lump-sum allowance for remote working cuts the deductible expenditure on digital tools for use at a home workplace by the asserted amount. It is not credited against the general lump-sum allowance for promotion expenses of EUR 132.

Expenses on ergonomic furniture (including but not limited to desk, swivel chair, lamps) of a home workplace may be asserted as income-related expenses for up to EUR 300 per calendar year (without being credited to the lump-sum allowance for promotion expenses), subject to having at least 26 days of remote working per calendar year. If the total purchasing or production costs of such furniture exceed the maximum amount, the excess may be asserted, again up to the maximum amount, in a subsequent year up to the calendar year of 2023. For assets procured in 2020, a transition rule applies in such way that the maximum amount for the 2020 calendar year is EUR 150 (always provided that the employee worked from home for at least 26 days). An application to account for such costs constitutes a retroactive event within the meaning of Section 295a of the Austrian Federal Tax Code BAO. The maximum amount for the 2021 calendar year thus is EUR 300, reduced by the amount asserted in the 2020 calendar year. Altogether, up to EUR 900 in additional promotion expenses are tax-deductible up to 2023. However, the employee must not assert any further expenses for a work room at home in the same calendar year.

Contrary to the labour law provisions, the tax provisions are time-limited and will become ineffective on 1 January 2024.

Amendment of the Ordinance Governing Payroll Accounts

A change in the Ordinance Governing Payroll Accounts needs to be noted by employers: In order to compute the maximum non-taxable lump-sum allowance for working from home, and the lump-sum allowance for income-related expenses regarding ergonomically fit furniture for remote working, it is necessary to enter in the payroll account every day on which the employee works solely from home, regardless of whether or not a lump-sum allowance for working from home is actually paid out.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.