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Austria – Staffing firms to pay into agency worker fund

27 August 2012

Staffing firms are facing higher costs for unemployed agency workers next year as the Austrian Ministry of Social Affairs last week announced plans to introduce a special fund for jobless temporary workers – and temporary employment agencies are expected to contribute to this.

The Austrian newspaper Der Standard reported on Friday that the Ministry wants to kick-start a fund for jobless agency workers to increase their unemployment benefits with extra one-off payments. The fund aims to collect €10 million and could also be used to finance further training for temporary workers.

The fund is planned to start in January 2013 and this will see staffing firms contribute 0.25% of wage bills paid to workers in the first year of the fund running. This is going to increase to 0.8% by 2017, the newspaper claims.

The Ministry of Social Affairs will contribute €2 to €3 million per year as special start-up funding. Unions in the country have welcomed the move, arguing that this will counteract a “hire and fire” culture in the industry.

Other plans that would have seen a tightening of the law for staffing firms will not be introduced. The Social Affairs Minister Rudolf Hundstorfer said that previously planned regulations to offer bonus pay programmes, which permanent staff are entitled to, will for now not have to be applicable to temporary workers.

This comes after major recruitment firms in the country, including ManpowerGroup and Trenkwalder, have recently spoken out against legislative changes which will charge employment agencies a sum of €110 on the termination of a contract with temporary workers – even if the worker finds permanent employment elsewhere.

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