The 3rd COVID-19 act published on 4 April 2020 includes important answers to current questions regarding payroll accounting in Austria.
If the distance between any person’s home and their place of work is not covered anymore or not on every workday due exclusively to the current COVID-19 crisis, the commuting allowance may be taken into account, as for instance in case of sick leave, to the same extent as prior to adoption of the COVID measures. This applies to (voluntary or obligatory) home office work, to quarantine cases and in case of COVID-19 short-time work. So, no reduction needs to be effected if the distance between place of residence and place of work is not covered on at least 4 / 8 / 11 days a month due to the coronavirus crisis. In our view, new applications for commuting allowances that were only submitted during the coronavirus period should be accepted by the employer in exceptional cases only.
Dirty-work bonus, extra pay for difficult working conditions, and danger pay; Sunday, holiday and night shift premiums
These types of extra pay or premiums that employers continue to pay to employees in case of home office work, quarantine or COVID-19 short-time work may still be treated as tax-exempt. The tax exemption of such extra pay/premiums, which incidentally is limited in terms of amount, normally requires that the relevant work is actually performed. So far, exemption from tax has been accepted only in case of sickness (but not in case of vacation). Hence, the above-mentioned “corona-related” facts are considered equivalent to sick leave.
Extra pay and premiums exempt from tax and social insurance contributions
Extra pay and premiums additionally paid to employees due to the COVID-19 crisis will be exempt from tax and social insurance contributions up to an amount of EUR 3,000 in the 2020 calendar year. To be so exempt, they must be additional payments effected for that purpose exclusively and not normally granted prior to the current crisis. For the rest, the favourable taxation of the 13th and 14th monthly salaries is maintained as before. No exemption from incidental wage costs (DB [employer’s contribution], DZ [employer’s supplement], KommSt [municipal tax]) is contained in the legislative package.
It remains to be seen how generously this new exemption from tax and social insurance contributions will be interpreted by the fiscal authorities. For it appears that the legislator’s explanations are intended to limit the scope of application of this provision. These explanations mention employees whose perform extraordinary work in areas indispensable to maintain the system. The starting point of these considerations is likely to have been food retailers, but also healthcare. In our view, it is by no means only “systemic” companies or organisations that are mentioned in the legislative text, rather it basically covers all employees; but of course, the purpose of the payment (extra pay/premium) must show a clear connection to the COVID-19 crisis.
Accident insurance cover in the home office
So far, applicable case law has usually treated accidents in private households merely as leisure accidents. So, while medical treatment by resident physicians or in the hospital was ensured after such accidents, the special extra benefits within the scope of statutory accident insurance were not provided. The difference is primarily relevant in the event of accidents resulting in severe disabilities. This is the sphere where statutory accident insurance guarantees (even) better rehabilitation services and disability pensions (financial benefits).
For the duration of the COVID-19 measures, accidents bearing a temporal and causal relationship to home office work will now also be considered as occupational accidents, thus justifying the granting of benefits from statutory accident insurance.
Garden leave for risk groups
The health insurance carrier must inform employees about their classification in the COVID-19 risk group. The definition of this risk group is effected by a group of experts set up by the competent federal ministries. Based on this general information provided by the health insurance carrier, the employee’s attending physician must assess the relevant person’s individual risk situation and issue a certificate regarding classification of the person concerned in the COVID-19 risk group, if applicable (COVID-19 medical risk certificate).
If an employee submits this COVID-19 medical risk certificate to their employer, they are entitled to be granted garden leave with continued payment of remuneration, except if
- the person concerned can perform his/her duties at home (home office) or
- through appropriate measures, the conditions for performing their duties at the place of work can be adjusted in such a way that a COVID-19 infection is excluded with the greatest possible certainty, including measures applicable to the journey to and from work, or
- the employee is employed in an area of “critical infrastructure” (i.e. generally no entitlement to garden leave). However, the law does not include any definition of said infrastructure.
Any dismissal announced due to the relevant person making use of their entitlement to garden leave may be challenged in court.
Garden leave may be taken until no later than 30 April 2020. This period may be extended by decree.
As regards the financial framework, this new model is based on the quarantine measures ordered by the official authorities. That means, employers must initially continue paying the remuneration, and after termination of the garden leave, they are given a period of six weeks to apply for reimbursement of their costs. The reimbursement of costs comprises the gross salary and the employer’s social insurance, but not ancillary wage costs (DB [employer’s contribution], DZ [employer’s supplement], KommSt [municipal tax]) or pro rata special payments. The application must be filed with the health insurance carrier.
The following must be observed:
- In our view, the information of the employee by the health insurance carrier cannot be a prerequisite for the entitlement to garden leave.
- An employee is not obliged to go to the doctor; that must remain their individual decision. Even if the employee decides to get medical treatment, they cannot be obliged to request a COVID-19 medical risk certificate from the physician. Nor are they obliged to submit any medical certificate issued by the physician to their employer.
- In our view, the medical certificates issued prior to the law entering into force are not considered as COVID-19 medical risk certificates, because the law was not even in force at that time, and hence no legally binding definition of risk groups existed. This may be relevant with respect to the employer’s claim for reimbursement of costs vis-à-vis the health insurance carrier.
TPA tip: Under no circumstances will a COVID-19 medical risk certificate in itself result in a valid claim for paid garden leave! The possibility of home office work must be examined in particular. If this is not possible, it must then be checked whether the person’s individual situation at work can be adjusted such that a COVID-19 infection can be excluded to the greatest possible extent. If employers are too careless in granting garden leave, they may lose their claim for reimbursement of costs against the health insurance carrier.