What steps are needed for an Austrian asset sale to protect employee rights under Betriebsübergang rules?

In Austria, an asset deal may qualify as a \"Betriebsübergang\" (transfer of an undertaking) under section 3 AVRAG if a going economic entity is transferred and continues its activity (share deals generally do not).

If applicable, all employment contracts transfer automatically by law to the buyer, including accrued and future employee entitlements, and dismissals solely due to the transfer are invalid.

The works council (or employees, if none exists) must be informed in advance and in writing about the transfer and its consequences.

A "Betriebsübergang" also triggers employer obligations beyond labor law, such as social security re-registration and tax notifications.

From a buyer’s perspective, careful assessment of whether a transfer applies, focused employment due diligence, and appropriate warranties and indemnities are key to managing post-closing risk.

We would be glad to assist you in structuring and implementing your planned transaction in full compliance with Austrian labor and employment law.