AUSTRIA: Agent’s termination for reasons of age without regular retirement and indemnity.

Gustav BREITER | AUSTRIA | 2011-11-15


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The female commercial agent at the age of 58 years terminated the agency contract with effective date April 30, 2008. The responsible social insurance institution decided on August 5, 2008 that she is entitled to early retirement (before the regular age of 60 years) with the effective date May 1, 2008. This was due to the fact that she already worked for 40 years.

She claimed for an indemnity for the customer stock according to art 24 Austrian Act on Agents (Handelsvertretergesetz – HVertrG 1993). The Austrian High Court decided that an indemnity for reasons of age can also be due in case of an earlier retirement resp. before the regular retirement. It is not a legal requirement that the agent has already reached the regular age of retirement (65 years for men, 60 years for women). The understanding of the term ‘age’ has to be seen in context with the further requirement that (due to reasons of age or illness) it would be unreasonable to expect the agent to continue the contract. So the ‘age’ in the sense of art 24 is ‘a typically higher age’ which makes the continuation unreasonable. In any case, it is not relevant if and when the agent is entitled to retire under the rules of social insurance.

If the agent has reached the regular age of retirement, the continuation of the contract has to be seen as unreasonable. In case of an earlier termination (as it was the case at the age of 58 years), the agent has to state and prove that she cannot be expected to continue (the same applies to cases of illness).

All circumstances have to be considered, especially the contractual territory, the number of customers, the intensity of the necessary activities of the agent etc. In the concrete case the High Court told the court of first instance to clarify this aspect in the further proceedings.

Comment: The difference between cases of illness and a ‘higher’ age is, of course, that the illness can be evaluated by an expert opinion. But, whether an age of e.g. 58 years makes the continuation of the contract unreasonable, cannot be evaluated by an expert, it must only, but still, be stated and explained by the agent in the court proceedings.



Gustav Breiter, agency & distribution country expert for Austria.



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