Switzerland PEO Services

Global PEO Services (GPS) helps companies hire employees in Switzerland without establishing a legal entity. All human resources, benefits, payroll, and tax needs for the employees are managed by the Global PEO, while the new hires and headquarter teams focus on your business goals.

When hiring employees in Switzerland, establishing a subsidiary or branch office is not always the best route, as it’s often a lengthy and expensive process. Hiring via a Professional Employer Organization (PEO), or Employer of Record (EOR), is a faster and often more effective option – especially when starting up in a new country.

Global PEO Services hires the employees on your behalf, legally contracting them through our subsidiary in accordance with Switzerland labor laws. As a result, the burden of compliance is on us and the employees can begin work for your company in a matter of days. PEOs/EORs provide you with a streamlined option for hiring employees, testing markets, and responding to growing business needs in Switzerland. With Global PEO Services, you get control without taking on legal entity liabilities, contractor risks, or sacrificing on talent or speed to market.

Most employees in the private sector of Switzerland sign an employment contract that specifies the terms of their employment. In case there is a collective agreement, it can also include these terms.

The Code of Obligations mandates written employment contracts for some category of employees before they start working, such as traveling salespersons. For other employment relations, there can be an oral employment contract. When in probation period, either party may end the contract by giving 7 days’ notice.

There is no specific duration for fixed-term contracts, although if the same parties sign successive employment contracts without a particular reason, a Swiss court may declare it to be an employment agreement for an unlimited period.

Holidays

Public holidays in Switzerland are mostly determined on the Cantonal level, as there is only one national holiday—National Day on August 1. Cantons often vary in declared public holidays based on the religious affiliation of the canton (Catholic or Protestant). Employees must receive paid leave on these holidays, while paid-by-the-hour workers receive paid leave as specified in their employment contract. However, all employees must receive paid leave on the National Day.

Annual Leave

Usually, employers need to provide 4 weeks of paid vacation days to employees every year. However, employers need to provide 5 weeks of paid leave annually to workers who are below 20 years of age. Employers need to allow employees to take a minimum of 2 weeks’ leave consecutively and cannot pay workers in lieu of vacation.

Additionally, if an employee does not come to work for longer than a month in a year, the employer may lessen the holiday entitlement by 1/12 for each full month of absence, unless the absence is due to certain unavoidable circumstances.

Maternity Leave

All female employees receive maternity leave for 14 weeks after childbirth. Under the compulsory insurance program that provides covers for “loss-of-earnings,” employees who have worked for an employer for a minimum of 3 months may receive 80% of their regular pay as a daily allowance for 14 weeks after childbirth subject to the highest amount of 196 francs per day.

In case an employee is not eligible for this program, she is entitled to leave under the sick leave provisions of the Code of Obligations. There are no specific provisions for maternity leave before childbirth, but pregnant employees can take sick leave in this duration if they are unable to work. A woman is not allowed to return to work for the first 8 weeks after the birth of a child. When a new mother resumes work, the employer:

• needs to ensure that the performance of the job does not pose a risk to the employee’s health,
• cannot make her work overtime, and
• needs to provide adequate paid time for breastfeeding.

Employers may not dismiss pregnant workers or new mothers during the first 16 weeks post-childbirth.

Paternity Leave

Swiss law does not mandate paternity leave. Still, male workers typically receive 2 or 3 days’ leave after the birth of their child, although this decision is at the discretion of employers.

Sick Leave

All persons gainfully employed or residing in Switzerland are entitled to sickness benefits. The insured pay premiums, which vary on the basis of the fund, types of benefits, the age of first insurance, and the canton. The law does not make it mandatory for employers to contribute, but some collective agreements necessitate that the employer must share employees’ membership fees.

The Swiss law mandates employers to continue paying employees who cannot work due to illness subject to certain conditions. Cantons specify limits of sick leave after the first year of an employee.

Other Leave

Employees under 30 years of age are entitled to 1 week’s leave without pay per year to volunteer for a social or cultural organization. In addition, employers must provide leaves of absence to employees for the performance of their compulsory military duties.