5 practical tips for implementing the mobility budget

On 9 January 2026, the Council of Ministers discussed and approved draft legislation updating the federal mobility budget requirements. Under the proposed law, all employers who provide company cars for more than 36 months must offer a mobility budget as of 1 January 2027.

For employers with 15 to 50 employees, the obligation will take effect as of 1 January 2028.

Although this obligation applies broadly, a limited number of exceptions apply:

-          employers engaged in collective dismissal procedures

-          companies classified as being in difficulty

-          small companies with an average workforce of fewer than 15 employees during the reference period

The new requirements are slated to take effect on 1 January 2027. The draft legislation will now be submitted for advice to the Council of State, the Central Economic Council, and the National Labor Council, marking the next step in the legislative process.

Importantly, this future obligation does not mean that employees will automatically be enrolled in the mobility budget. The employer still sets the terms through a formal policy. On the other hand, while the mobility budget must be offered, participation is not mandatory for employees, as opting in remains voluntary.

As an employer, it’s crucial to be well-prepared for the implementation of the mobility budget. It should not stand alone but be fully integrated into a broader mobility policy and aligned with existing company car selection processes. The good news is that the current mobility budget legislation offers significant flexibility, giving employers a wide range of options to tailor the program to their needs.

However, thoughtful decision-making is essential, as there are many factors that can influence the effectiveness of the mobility budget.

Drawing from our years of experience implementing mobility budgets, we share five key considerations that can support successful integration within your organization.

Although the mobility budget will become mandatory, it still allows for considerable flexibility within an employer's policy. A clear and well-thought-out policy is critical, allowing employers to define and communicate the rules transparently to employees.

For example, employers can still set entry conditions by specifying in the policy that employees may only enroll in the mobility budget when their current lease expires. With the upcoming requirement in mind, it’s worth considering now whether employees with leases expiring soon might prefer to extend their current lease until they become eligible to participate in the mobility budget.

Employers should also carefully assess whether it is necessary to require certain roles to continue choosing a pillar 1 car.

The draft legislative text provides that employers may oblige certain employees to choose a pillar 1 car. Any such requirement should be based on objective, non-discriminatory, and proportional criteria that are directly related to the job function and legitimate business interests. For example, employees such as sales representatives or technicians who are required to visit clients regularly as part of their job duties may be obliged to opt for a company car—even when participating in the mobility budget.

Once everything is clearly defined, an annex can easily be added to the employment contract, including the required legal references, the start date, and the allocated budget.

In addition to policy-specific considerations, it’s also essential to think about how the mobility budget will be calculated. Does your organization already categorize company cars based on job profiles? Does your car policy reference lease amounts or Total Cost of Ownership (TCO)?

Since there are several ways to determine the budget, it’s important to carefully evaluate what works best for your organization - and what the implications are for employees. For example, if an employee currently receives a monthly fixed reimbursement for car expenses, this would no longer apply under the mobility budget unless it’s explicitly incorporated or clearly communicated.

Employees can only begin using the mobility budget once it’s been formally established. When designing the mobility budget, it’s crucial to carefully consider which components to include, as each additional element may impact internal processes and introduce administrative overhead.

A good example is the reimbursement of housing costs under Pillar 2. Although this is generally only available to employees who live within 10 kilometers of the workplace, it can also apply to those who regularly work from home (at least 60% of their working hours). However, many companies choose to exclude this option to avoid encouraging excessive remote work.

For now, the draft legislation does not foresee any changes to the three existing pillars:

• Pillar 1: (Electric) company car
• Pillar 2: Alternative mobility solutions and housing costs
• Pillar 3: Cash payment

Employers are not required to offer all three pillars. It is perfectly acceptable to offer only Pillars 2 and 3, and even limit the options within Pillar 2. The key is to make choices that best serve both the organization and its employees.

If your company already offers a cafeteria plan that includes mobility-related options, it's important to carefully assess whether these options are compatible with the mobility budget.

Take bike leasing, for example - a popular benefit in many cafeteria plans but not entirely compatible with the mobility budget. Once an employee switches to the mobility budget, it is generally advised not to grant a leased bike through the cafeteria plan anymore. From that point on, financing a (new) bike should happen via the mobility budget instead. This is the only way to preserve the tax benefits - provided the bike is regularly used for commuting.

If an employee who has chosen the mobility budget still gets a leased bike through the cafeteria plan (e.g., using their year-end bonus), the bike loses its favorable tax status. Its full value then becomes subject to social security contributions and taxes. In other words: the tax benefit is lost.

This principle also applies when combining the mobility budget with a standard bike lease program or other mobility benefits, such as a cycling allowance.

While these challenges aren’t insurmountable, companies should seek informed guidance to manage them effectively.

One of the biggest pitfalls of the mobility budget is the administrative burden it can create. Over time, we’ve seen organizations fail to consistently follow established processes, leading to compliance issues.

For example, if an employee requests reimbursement of housing expenses, these are typically paid out monthly. But has it been verified that the employee is listed as the tenant on the lease? What happens if the employee moves and no longer lives within 10 kilometers of the workplace?

Our first recommendation is to carefully evaluate what is included in the mobility budget. A more limited offering often simplifies processes. Also, involve all key stakeholders in the implementation - including HR, Compensation & Benefits, recruitment, the fleet or mobility manager, and the finance department - since accounting and VAT considerations are often relevant as well.

And of course, the more automation, the better. There are excellent mobility apps available that help automate the decision-making process for Pillar 2 and reduce the employer’s administrative workload. These tools are convenient for employees and even more valuable for employers when they include document verification through AI, consultants, or both. This helps ensure ongoing compliance with the mobility budget framework.

The mandatory implementation of the mobility budget introduces several points of attention, such as a well-considered policy, a clear employment contract annex, and compatibility with any existing cafeteria plan.

In short: thorough preparation is key to a smooth launch as of 2027!