By amending the Construction Workers' Holiday and Clearance Act, and the Construction Workers' Bad Weather Compensation Act 1957, Austria has transposed into the national legislation exclusively Article 3.1a Directive 96/71/EC as amended and supplemented by Directive 2018/957/EU (provisions on long term postings), and only to the construction sector. 

The amendments have entered into force on 1 April 2021.

Can it be alleged that Austria has not fully transposed the amended Posting of Workers Directive?

Regarding the first period of 12 months, Directive 2018/957/EU introduces the following changes to the terms and condition of employment must be granted to posted workers:

Where the mandatory terms and conditions of employment under Directive 96/71/EC had concerned only the construction sector, that directive has not precluded the application by Member States, to national undertakings and to the undertakings of other States, on a basis of equality of treatment, of terms and conditions of employment laid down in the collective agreements or arbitration awards (within the meaning of Article 3 paragraph 8), concerning other business sectors.

Pursuant to its Section 1(4), the Austrian Anti-Wage and Social Dumping Act (LSD-BG), without prejudice to the law otherwise governing the employment relationship, also apply to workers posted to perform work in Austria or hired out on a cross-border basis from the European Union (EU), the European Economic Area (EEA), the Swiss Confederation or any other third country (regardless of the business sector).

Regarding the concept of “minimum remuneration” within the meaning of the LSD-BG, workers posted to Austria by an employer established in an EU Member State or EEA State or a third country in order to perform work shall, without prejudice to the law governing the employment relationship, be mandatorily entitled to at least the remuneration determined by law, ordinance or collective agreement (except for contributions in accordance with Section 6 of the Company Employee and Self-Employed Pension Act - BMSVG, or comparable Austrian legal provisions and contributions or premiums according to the Company Pension Act - BPG), to which comparable workers employed by comparable employers are entitled at the place of work (Section 3.3 LSD-BG).

In addition, if a law, ordinance, or collective agreement provides for special payments, the employer shall make such payments to the posted worker or the worker who has been hired out on a cross-border basis on a pro-rated basis for the respective wage period, in addition to the regular remuneration (Section 3.4 LSD-BG).

It follows that the concept of “minimum remuneration” within the meaning of the LSD-BG had fully transposed the definition of remuneration as laid down (later) in Directive 2018/957/EU. The word “minimum” from the Section 3 LSD-BG, must be read as meaning “equal pay for equal work” (vs identical pay for equal work), and not “minimum rates of pay” (in the strict sense of Article 3.1 Directive 96/71/EC).

Regarding allowances or reimbursement of expenditure to cover travel, board, and lodging expenses for workers away from home for professional reasons, such payments fall under special payments (supplements and allowances) and are due in accordance with the relevant applicable collective agreement.

Changes regarding long-term posting introduced by Directive 2018/957/EU, require to a certain extent national transposition, and not only to the construction sector. However, the amendments required are minor.

To consider that on the one hand, in principle, the whole relevant system of Austrian labour law (within the meaning of Article 3.1a Directive 96/71/EC as supplemented by Directive 2018/957/EU) applies to posted workers, and on the other, almost all collective agreements are concluded at sectorial or industry level.

The mandatory application of the principle of equal treatment in accordance with Article 5 Directive 2008/104/EC (see Article 3.1.b Directive 96/71/EC as supplemented by Directive 2018/957/EU), does not require further transposition.

The obligation to provide information (in situations of successive postings of temporary agency workers), requires transposition into the national legislation.

Article 5 Directive 2018/957/EU (monitoring, control, and enforcement) does not require further transposition. Inter alia, Section 2 LSD-BG provides for the concept of “true economic substance”.

The takeaway

The amened PWD is mostly transposed into the Austrian’ national legislation, and the latter legislation must be complied with.