Hire in Switzerland

Employer of record in Switzerland

If a lack of speed or local expertise are among your top concerns when expanding to or employing workers in Switzerland, an employer of record may be the best option for achieving your global growth objectives.

An employer of record, sometimes known as an international PEO, enables you to quickly hire and onboard workers in Switzerland―often in as little as two weeks―without having to take on the cost and risk of establishing a local entity.

Learn about the hiring, employment, payroll and benefits requirements for workers in Switzerland, and how our employer of record service, EOR, and local HR experts can help you manage your international employment needs.

Hiring in Switzerland

There are several main sources of labor law in Switzerland. Some examples include the Federal Code of Obligations and the Federal Labor Act. The former sets standards on matters of employment contracts and termination, while the latter contains standards for various conditions of employment. 

As your employer of record and PEO in Switzerland, we can ensure that every contract, for every worker, meets all requirements. We can also provide you with guidance about cultural norms and hiring best practices and keep you up-to-date with employment regulations as they change.

Employment contracts in Switzerland

As you look to hire employees in Switzerland, here are some common regulations you’ll need to know to create a compliant contract, as well as how an employer of record and PEO can provide support for your unique HR needs.

Working hours

Employment contracts in Switzerland must include details about required work hours. Employees in industrial, office, and sales roles are limited to a maximum of 45 hours per week, and all others are limited to 50 hours per week.

Compensation

As you consider the appropriate salary to offer new employees, keep in mind:

• There is no mandated minimum wage for employees in Switzerland.
• Employees who work overtime are entitled to 25% added pay or compensatory time off. The annual overtime limit is 170 hours for employees who work 45 per week, and 140 hours for those who work 50 hours per week.
• Employees required to work on Sundays or public holidays are entitled to 50% additional pay.
• Wages must be paid at least monthly.

As your employer of record in Switzerland, we can provide you with resources and insights about employee compensation, so you are better equipped to make a competitive employment offer.

Bonuses

Although there is no mandatory bonus in Switzerland, it is customary for employers to pay a “13 month’s salary,” or a bonus equal to one month’s salary at the end of the year.

Probationary period

The Swiss Code of Obligations allows employers to require a probationary period of up to three months if it is specified in the employment contract. If not addressed in the contract, the probationary period is for one month. Any deviation from a one to three-month probationary period must be in writing.

Termination and severance

Unless spelled out differently in an employment contract or collective labor agreement, written notice of termination must be provided:

• During the probationary period (which may not exceed three months), seven days notice is required
• After the probationary period but during the first year of service, one month’s notice
• Second through the ninth years of service, two months’ notice
• After the ninth year of service, three months’ notice

A contract may be terminated without notice if there is just cause, which the Code of Obligations defines as a condition that prevents either the employer or employee from being able to continue the relationship in good faith. If the employer terminates the contract without a just reason, it must compensate the employee for damages and pay a penalty of up to six months’ remuneration.

Employees cannot be dismissed during certain protected periods such as during absences due to illness or accidents, during pregnancy, within 16 weeks after childbirth or during military or civil service.

Furthermore, employees are also protected against dismissal if they are exercising a constitutional right or are part of a mass layoff not conducted per the rules for collective dismissal.

An employer must provide a departing employee with a written job reference or employment attestation. The former employee must have this document to apply for unemployment benefits.

As your employer of record in Switzerland, we can work with you to quickly handle the unforeseen event of an employee termination, providing legal guidance and a personalized process that ensures you stay out of labor court.

Employee benefits and paid leave in Switzerland

When negotiating terms of an employment contract with a candidate in Switzerland, here are some of the statutory benefits and paid leave requirements to keep in mind, as well as how an employer of record can support your company’s benefits strategy.

Maternity leave

Pregnant employees are entitled to 14 weeks of maternity leave after the birth of a child. For employees who have worked for the same employer for at least three months and contributed to the social security system for at least nine months, there is a daily allowance of 80% of their wages during maternity. If an employee does not qualify for the maternity allowance, she is entitled to claim sick leave benefits.

Vacation

Employees in Switzerland are entitled to four weeks of paid vacation a year, and two weeks must be taken consecutively. An employer may not pay workers in lieu of granting them vacation time, and unused vacation may not be carried over.

Holidays

Although Switzerland only observes one national public holiday, National Day, various regional and religious public holidays are celebrated throughout the country.

Sick leave

Swiss law requires employers to continue to pay employees who are unable to work due to illness and who have been employed for at least three months for between one and three weeks (depending on the canton) in the first year of employment and for longer periods at full pay proportionate to longer periods of employment. Cantons specify sick leave limits after an employee’s first year. Employers may require a medical certificate for any absence longer than three consecutive days.

Health coverage

Switzerland has three “pillars” to support income for retired workers:

• The Social Security old-age pension
• Occupational pension plans
• Voluntary private pensions.

The old-age pension plus the occupational pension are intended to provide eligible retirees with about 60% of their last income before retirement.

Old-age pension. Men at 65 years of age and women at 64 may retire and collect an old-age pension if they have made at least one year of contributions into the system. The amount of the pension depends on a person’s years of contributions and his or her income. The pension is reduced if a person retires at an earlier age and increased if a person retires later. Old-age and survivors’ insurance, disability insurance and unemployment insurance are partially funded through employer and employee contributions (5.15 percent of salary each). The federal government and the cantons pay part of the fund’s expenses.

Occupational pension plan. This type of plan is sponsored by the employer and established and governed as an entity separate from the old-age pension. An employer is required to register its employees with an occupational retirement plan, and both the employer and the employee make contributions, the amount of which depends on the plan and the salaries to be insured.

Voluntary private pension. Employees can enroll in individual plans, such as life insurance or savings plans.

Additional benefits

In addition to healthcare, the Swiss social security system includes unemployment, disability, accident and pension insurance.

Employer social costs will cover a large portion of employee benefits in Switzerland, but we can consult with you about supplemental coverage options, such as additional pension contributions or life insurance, if needed.

Updated: December 18, 2023

Employee onboarding with an employer of record in Switzerland

We write and validate all local employment contracts, streamlining the onboarding process for you and your Switzerland employees—all you have to do is provide relevant information and review and approve the employment agreement.

As your employer of record in Switzerland, we will:

• Schedule a welcome call to discuss HR and employment information for Switzerland, as well as answer any questions
• Prepare a customized employment contract in English and in the preferred national language, such as German, French, Italian or Romansh
• Share the employment contract and benefits information with the new employee for signature and review
• Gather tax and banking information from the employee to set up payroll
• Provide a local point of contact to the employee to answer any questions regarding their employment, local HR or payroll

The entire onboarding process for the employee is often completed in as little as two weeks.

Partner with Safeguard Global as your Switzerland employer of record and PEO

With over a decade of service, we are the longest-serving employer of record and PEO provider in the international market. Organizations around the world rely on EOR, our employer of record solution, to expand and hire in over 170+ countries around the world, quickly and compliantly.

We’ve seen just about every global employment circumstance imaginable—and with our extensive knowledge of local law and culture, we know what it takes to get employment right in Switzerland. We provide written contracts in the local language, salaries in the local currency and HR support in your employees’ time zone.

Additionally, as a global payroll provider we support payroll administration—including payments, filings and other calculations— all around the world and can accommodate the payroll outsourcing needs of any size organization.

Whether you’re looking to hire as part of a strategic expansion or to meet specific talent needs, our global solutions advisors can walk you through your international hiring options so you can make the right choice for your organization. Contact us today.

Disclaimer

The information provided on or through this website is for informational purposes only and does not constitute legal advice. Safeguard Global expressly disclaims any liability with respect to warranty or representation concerning the information contained herein, including the lost essence, interpretation, accuracy and/or completeness of the information in transit and language translation.