Austria’s Public Employment Service may have paid thousands of unemployed people too little money for years, after the country’s highest administrative court found that unemployment benefits had been calculated incorrectly.
The case began with a woman from Upper Austria who had been receiving unemployment benefits since 2022. The Austrian Public Employment Service, known as the AMS, set her daily benefit at 21.09 euros, based on a monthly gross income of 1,123.86 euros plus a share of special payments, reported by Kronen Zeitung.
But the woman challenged the calculation. She argued that the AMS had deducted too much in social insurance contributions from her previous earnings, leaving her with a lower benefit than she was entitled to receive.
At the heart of the dispute was a technical but important question: how should contributions to unemployment insurance be counted when officials calculate a person’s net income for benefit purposes?
The AMS had used the standard employee contribution rate in every case. A lower court initially agreed with the authority, saying that an averaged calculation was acceptable when determining unemployment benefits.
However, the Constitutional Administrative Court, the Verwaltungsgerichtshof, overturned that decision after an extraordinary appeal. It ruled that reduced unemployment insurance contributions for people on low incomes must also be taken into account. A blanket calculation that disadvantages claimants, the court said, conflicts with the law’s aim of keeping unemployment benefits close to a person’s actual net earnings.
The ruling could have wide consequences. In 2026, people with gross monthly incomes of up to 2,225 euros pay no separate unemployment insurance contribution, while reduced rates apply up to 2,630 euros.
The Social Ministry said the precise legal consequences were still being examined and that new guidelines for the AMS were being prepared.
Because incorrect benefit calculations can be corrected retroactively for up to three years, people with low previous incomes may now be able to ask the AMS to review their cases and claim back payments.
