2024 budget agreement – changes to system of flex jobs
18 Oct 2023
The Federal government recently concluded the 2024 budget agreement, which includes an expansion of the scope of application of the system of flex jobs (‘flexi-jobs’) to 12 additional sectors as of 1 January 2024. Several changes to the characteristics of the system itself were also agreed on.
Please note that, as there are currently no draft legal texts on these changes available yet, the below information is based on the government’s press releases and could therefore still be subject to change going forward.
Flex jobs – what’s in a name?
The system of flex jobs allows employees who work at least 4/5th of a full-time employment, as well as pensioners, to complement their work schedule with additional hours (with another employer) at a salary that enjoys a favourable social security and income tax treatment. As the name indicates, the aim of this system is flexible deployability of workers, however, limited to clearly-defined sectors, which currently include inter alia the hospitality sector, department stores, independent retailers, food retailers and bakeries.
From the perspective of the individual, the flex salary is fully exempt from social security contributions and withholding taxes. The employer, on the other hand, is required to pay a special employer social security contribution of 25% (this percentage will, however, be adjusted upwards as of 1 January 2024).
The expansion to 12 additional sectors
As mentioned above, effective 1 January 2024, the system of flex jobs will be expanded to 12 additional sectors, including childcare, education, agriculture and horticulture, and the events - and food sectors.
Broadly speaking, the government's continued goal with this new expansion of the scope of application, is to make it possible to attract personnel more quickly and easily in sectors where there is a labour shortage.
Changes to some of the system’s characteristics
In addition, several of the characteristics of the system of flex jobs will be modified, effective 1 January 2024 as well. Where, currently, the federal minimum wages must in principle be taken into account in case of flex work, the (higher) sectoral wage scales will become applicable as of this date. Moreover, a new maximum threshold is introduced for flex work; going forward, the system will only be able to be used for a maximum of EUR 12,000 per year per worker. Also, the specific employer social security contribution that’s due on the flex salary will increase from 25% to 28%.
Conclusion
As from 1 January 2024, the use of flex jobs will be possible in more sectors than ever. However, this expansion of the scope of application is off-set with a higher cost for a company that employs flex workers, due to the fact that i) the sectoral wage scales will become applicable and ii) the employer social security contributions will increase to 28%. If you have any questions on how these changes will affect your company, don’t hesitate to reach out: we’d love to hear from you.
