Death of a GmbH Managing Director: No General Contingency Duty

Sept 17, 2026 Benn-Ibler Rechtsanwälte

In a recent decision, the Austrian Supreme Court (Oberster Gerichtshof, hereinafter OGH) examined whether the sole shareholder and managing director of a GmbH is required to make contingency arrangements in anticipation of their sudden death. The case concerned whether an employee could bring claims against the GmbH after salary payments ceased following the managing director’s death.

The claimant was the defendant GmbH’s sole employee, whose sole shareholder and managing director died unexpectedly after an approximately one-month hospitalisation during which he was comatose. The claimant continued working for approximately two months following the managing director’s death. When no further salary payments were made, she resigned with immediate effect. At that time, no new managing director had been appointed, and the deceased’s estate had not yet been formally represented.

The employee subsequently claimed, among other forms of relief, compensation in lieu of notice. Such compensation would have required the employer to be responsible for the circumstances that led to her resignation. The OGH therefore considered whether a GmbH is required to make contingency arrangements in the event of the unexpected death of its sole shareholder and managing director. The Court rejected the existence of such an obligation, holding that the employer’s duty of care does not require a managing director, absent specific indications of a threat to their life, to make arrangements during their lifetime for the possibility of their death.

The Court further observed that the Austrian Limited Liability Companies Act (GmbH-Gesetz) provides a mechanism for addressing circumstances in which a company is temporarily without a managing director. Under Section 15a thereof, an emergency managing director may be appointed, and the company’s employees may, in principle, apply for such an appointment. However, the OGH held that this provision does not require an employee to submit such an application. Nor does it establish an obligation for a managing director to make special contingency arrangements in anticipation of an entirely unexpected death.

OGH, 8 ObA 40/25b 24 June 2026