New continuing education allowance and “modified” educational leave/part-time work from 2026

As a successor model to the regulations on continuing education allowance (§ 26 AlVG) and educational part-time allowance (§ 26a AlVG), which expired on 31.03.2025, a draft law presented by the Ministry of Social Affairs provides, as of 01.01.2026, a so-called continuing education grant to (partially) secure livelihood.

In combination with the planned changes for educational leave or educational part-time arrangements, the new “continuing education time” model is intended to promote, in a more labor-market-targeted and budget-conscious way, especially lower-qualified individuals: instead of the previous approx. €650 million annually, only €150 million will be available for this purpose in the future. The granting of the allowance is subject to a positive discretionary decision by the Public Employment Service (AMS) and, for higher earners, is supplemented by a newly introduced employer contribution.

Key Points of the Planned Reform

The legislative amendment provides the following main points for the continuing education grant under § 37e of the Public Employment Service Act (AMSG) as of 01.01.2026:

• A key difference from the previous continuing education allowance or educational part-time allowance lies in the change of the legal basis. Unlike the formerly valid provisions of the Unemployment Insurance Act (former § 26 and § 26a AlVG), the AMS support is now regulated under the Public Employment Service Act and is therefore—true to its name—structured as a mere grant, i.e., without any legal entitlement.
• Employees applying for a continuing education grant must have been employed for at least 12 months subject to unemployment insurance in the same company before the start of the educational leave or part-time arrangement. For individuals employed in a fixed-term position at a seasonal business, the “waiting period” is reduced to three months. For those with a completed master’s or diploma degree, a continuing education grant is only possible if they have a total of at least four years (208 weeks) of employment subject to unemployment insurance, of which the last 12 months must have been spent continuously with the current employer.
• Due to the legal provision that periods of receiving maternity pay or childcare allowance generally count as employment subject to unemployment insurance—but do not count if they fall within the last 26 weeks before the start of educational leave or part-time education—it is no longer possible to claim the continuing education grant immediately following statutory parental leave.
• Employees may apply for the grant no earlier than three months before the start of educational leave. The law stipulates that, once the necessary documents for assessment are submitted, the AMS must decide on the granting of the allowance as soon as possible. Prior to this decision, educational counseling is required for individuals whose monthly gross salary is less than half of the current ASVG contribution ceiling (in 2026, expected to be €3,465.00).
• The continuing education program must comprise at least 20 hours per week, or 16 hours per week for individuals with childcare responsibilities (children up to seven years old). For university studies, at least 20 ECTS credits per semester must be completed, with the threshold reduced to 16 ECTS for those with childcare responsibilities for children under seven.
• For individuals whose current gross salary is at least 50% of the ASVG contribution ceiling (expected to be €3,465.00 in 2026), employers are required to provide a contribution to the AMS continuing education grant of 15% directly to the employee on leave. In this case, the AMS grant paid to the employee is correspondingly reduced. The social security contributions (health, accident, and pension insurance) arising from the mandatory employer contribution are fully covered by the AMS and are calculated in the same way as the grant for livelihood support.
  • Note: The draft law clarifies that the employer’s contribution is tax-free up to the marginal earnings threshold (relevant if the employer voluntarily provides a higher contribution than the mandatory 15%). Nonetheless, due to the rather “unconventional” design of this legal construct, payroll processing issues are very likely to arise.
• The continuing education grant is generally to be structured as an income-dependent tiered model, with the AMS defining the specific conditions for the amount and duration of the grant in coordination with the relevant ministries through a guideline. By law, for educational leave, a minimum daily amount of €40.40 and a maximum of €67.94 are specified. From 2026, these amounts are to be adjusted annually according to § 108 ASVG (expected amounts for 2026, applying an adjustment factor of 1.027: €41.49 and €69.77). The grant amount for educational part-time is to be calculated analogously, depending on income and reduction in working hours.
  • Note: Due to the only rudimentary legal regulation, the contents of the AMS guideline will be of central importance for the concrete details of grant disbursement. If the law is enacted as proposed by the Ministry of Social Affairs, it is to be hoped that the AMS guideline will be issued promptly and designed with practical applicability. The guideline will be published on the AMS website.

In addition to the grant-related provisions, the draft law provides the following labor law adjustments for educational leave and educational part-time (regulated in § 11 and § 11a AVRAG):

• The required period of employment with the company is generally increased from six to twelve months.
• The agreement on educational leave or educational part-time must specify the current level of education, the training measure, and the educational objective.
• The labor law agreement only becomes legally effective (as of the following day) once the continuing education grant has been awarded to the employee by the AMS. The employee is obliged to inform the employer immediately of this notification (grant awarded or denied).

It should be noted that the planned legislative amendment must still go through the legislative process after the review phase (until 29.09.2025). Therefore, changes or adjustments to the provisions are still possible. The finalization of the law is expected in the autumn. Further pending is the AMS guideline to be issued based on the legislative amendment.

Link to the draft law concerning educational leave, educational part-time, and continuing education grants:

https://www.parlament.gv.at/gegenstand/XXVIII/ME/46