Main measures in the government agreement concerning employees

The Government Agreement 2025-2029 introduces a number of reforms affecting employers and employees. Here is an overview of the main measures:

1. Unemployment benefits

– Unemployment benefit will be limited to 2 years (after a 5-year career), except for 55+ workers with at least 30 years of career (35 years from 2030).

– Possibility of receiving benefits after resignation for workers with a career spanning more than 10 years.

2. Leave and end of career

– Creation of a ‘family credit’ for childcare leave (valid for parents and grandparents).

– Continuation of part-time or 4/5ths-time work from the age of 55, with a minimum career of 30 years (35 years from 2030).

– End of unemployment system with single payment (early retirement), except for medical reasons or collective redundancies prior to the agreement.

3. Vocational training

– Abolition of the Federal Learning Account (FLA), replaced by a more flexible registration system.

– The individual right to training becomes more flexible, but cannot be converted into salary.

4. Flexible working

– Introduction of annualised working hours.

– Abolition of the minimum weekly threshold for part-time work (while maintaining a minimum of 3 hours per shift).

– End of the ban on night work in distribution.

– Extension of tax-privileged overtime (up to 360 hours voluntary/year).

– Student employment increased to 650 hours/year.

– Extension of flexi-jobs to all sectors (except protected professions), with higher income ceilings (€18,000/year).

5. Redundancy

– Reintroduction of a trial period with one week’s notice for the first 6 months.

– Capping redundancy payments at 52 weeks for new recruits.

– Limitation of special redundancy payments.

6. Incapacity for work

– Non-SME companies will pay 30% of National Institute for Sickness and Disability Insurance compensation during the first 2 months of incapacity (for 18-54 year-olds).

– Increased penalties for refusal to participate in reintegration programmes.

– Reduction of sick leave without a medical certificate to 2×1 day/year (companies with more than 50 employees).

– A relapse will not entitle employees to guaranteed pay until they have been back on the job for 8 weeks.

– Doctors will be able to specify which tasks can still be performed by the worker.

7. Wages and benefits

– Automatic indexation and the Pay Standard Act will be maintained.

– Progressive increase in net salaries from 2027 (via the tax-exempt portion and the employment bonus).

– Simplification and harmonisation of collective bonuses (CBA 90, profit bonus).

– Reduction in employer contributions:

o First employee: unlimited reduction of €2,000/quarter.

o 2nd to 5th employees: reduction of €1,000/quarter for 3 years.

– Increase in meal vouchers (+€2 twice), phasing out of eco-vouchers.

– Temporary suspension of the limited deductibility of hybrid cars and obligation to offer a mobility budget to employees benefiting from a company car.

Implementation: These measures, subject to modification, will come into force on 1 January 2025.