Hubert Troppmann, a teacher at a polytechnic school in St Poelten near Vienna, took legal action after local school authorities refused to pay him 78 hours overtime. His win means up to 70,000 teachers across the country could also make claims, costing the state an estimated 120 million euros (Pounds 83m).
In Austria, teachers must work a set number of hours each year. Any bank holidays that fall during the week are deducted from these hours. But in 2001-02, many bank holidays fell at weekends, which meant that Mr Troppmann and other staff effectively worked overtime that year.
The authorities argued that the number of hours worked was based on an average over a number of years, regardless of when bank holidays fall, and refused to accept the overtime claims.
After going through a number of courts, a tribunal in Vienna ruled in favour of the teacher.