Last updated on: September 5th, 2023
The labor relationship in Switzerland is mainly regulated by the Federal Code of Obligations 1911 (amended as of January 2022) which governs the terms and conditions of employment such as employment contracts and termination of employment etc. The Federal Labor Act, of 1964 (amended as of January 2021) sets out employment standards such as working hours, holidays and rest periods, wages, overtime, and employment relationships.
Other Regulation – Switzerland law provides comprehensive regulations and Ordinances which is an extension of the Federal Labor Law on various aspects such as working time, rest period, breaks, on-call requirements, Uninterrupted Operation, etc., for different types of businesses as follows:
Hours & Pay Regulations
Duration of Annual Leave – Employees are entitled to 4 weeks of paid vacation per year, of which at least 2 weeks must be consecutive. Where an employee has not yet completed one year’s service, his holiday entitlement is fixed pro-rata. Employees under the age of 20 are entitled to 5 weeks of paid vacation.
Annual Leave Pay– An employee is entitled to receive their full salary for the annual leaves taken. In case of any loss in the benefits for leave entitlement, the employer shall pay fair and reasonable compensation.
Payment in Lieu & Carryover of Unused Annual Leave – An employer cannot pay employees in lieu of granting them time to take annual leave and unused vacation generally cannot be carried over to the following year. Swiss Code of Obligations, March 30, 1911, art. 329 (a)(c).
Replaced Annual Leave with Cash Payment – The annual leaves cannot be replaced by cash payments or other benefits. If an employee engages in any activities for a third party that is in conflict with the company’s interests, the employer has the right to refuse to pay the employee’s compensation for the annual leaves.
Reduction of Annual Leave
- Where in a given year of service the employee through their own fault is prevented from working for more than a month in total, the employer may reduce the holiday entitlement by one-twelfth for each full month of absence.
- Where the total absence does not exceed one month in a given year of service and is the result of personal circumstances for which the employee is not at fault, such as illness, accident, legal obligations, public duties or leave for youth work, the employer is not entitled to reduce the holiday entitlement.
- A standard employment contract or collective employment contract may derogate from the above conditions if it gives employees terms of at least equal benefit.
Annual Leave Coinciding with Public Holiday – If a public holiday falls during annual vacation, the vacation period shall be extended accordingly.
Annual Leave coinciding with Sick Leave – In case, an employee falls sick during the holiday, those sick days are not cut from the annual holiday of the employee.
Annual Leave coinciding with Other Leave – The employer may not reduce the annual leave entitlement of:
- a female employee who is prevented from working by pregnancy for up to two months;
- a female employee who has taken maternity leave;
- a male employee who has taken paternity leave;
- an employee who has taken carer’s leave
- an employee who has taken adoption leave.
Swiss Code of Obligations, art. 329b&c.
Switzerland does not have a mandated minimum wage.
Where the employer pays a bonus over and above the salary on particular occasions, such as at Christmas or the end of the financial year, the employee is entitled to such a bonus where it is contractually stipulated. If the employment relationship ends prior to the occasion on which the bonus is paid, the employee is entitled to a pro-rata bonus where the contract so provides. The code of Obligations(amended Dec 2019) art. 322d.
Duration of Sick Leave – Employers continue to pay employees who are unable to work due to illness for up to 3 weeks in the first year of employment and as employees’ length of service with the same employer increases, they will be entitled to an additional period of paid time off.
Eligibility Criteria: An employee is entitled to sick leave benefit after 3 months of continuous service with the same employer for the first year and subsequently it will increase. Cantons specify sick leave limits after an employee’s first year.
Medical Certificate : Employees are required to inform the employer regarding any sick leave as soon as possible. Employers generally require a medical certificate for any absence longer than 3 consecutive days of leave due to sickness.
Sick leave coinciding with Annual Leave: If an employee falls sick during their scheduled annual leave, they have the right to convert their annual leave into sick leave.
The employee is required to provide a medical certificate to their employer as evidence of their illness. The medical certificate should indicate the period of sickness and the employee’s inability to take their annual leave as originally planned.
All employees residing or gainfully employed in Switzerland are entitled to sickness benefits. The insured pay premiums, which vary depending on the fund, the type of benefits provided, the age first insured, and the canton. Employers are not required by law to contribute, but some collective agreements require the employer to share employees’ membership fees.
In the case of daily sickness benefits insurance – Although not mandated by law, daily sickness benefits insurance is frequently included in employment contracts, benefiting both employer and employee.
Sick Leave Pay – An employee is typically entitled to 720 or 730 days of sickness benefits within a 900-day period, amounting to 80% of their regular salary.
The specific terms outlined in the insurance policy and general insurance conditions govern the provision of benefits from the daily allowance insurance. In some cases, the insurance policy may even offer a daily allowance equivalent to 100% of the employee’s salary. Swiss Code of Obligations, March 30, 1911, art. 328(a).
All female employees are entitled to maternity leave for 14 weeks after the birth of a child.
Pregnant and breastfeeding women shall be employed with their consent. Pregnant women may take time off from work or leave work by merely notifying their employer. Employers shall not employ any pregnant women between 8 pm and 6 am from the 8th week before the birth and must offer them equivalent work between 6am and 8pm. This obligation also applies to the period between the 8th and 16th week after the birth.
Pay – An employee who has worked at least 5 out of the 9 months before birth may receive 80% of the regular pay as a daily allowance subject to a maximum of 196 francs per day from Social Security.
There are no specific provisions for maternity leave before the birth of a child, but pregnant employees can take sick leave during this time if they cannot work. Female employees may not work during the first 8 weeks after the birth. Pregnant women may not be employed between 8 p.m. and 6 a.m. from the 8th week before the birth.
Breastfeeding Break – Employees must be given time for breastfeeding and expressing milk. This time counts as paid work time (at least 30 minutes per day for work of up to 4 hours; 60 minutes per day for work of more than 4 hours; and 90 minutes per day for work of more than 7 hours). Swiss Code of Obligations, March 30, 1911, art. 329(a)(c); Federal Law on Work in Industry, Trade, and Commerce of March 13, 1964, arts. 35(b).
Employees who are legally the father of a child at birth or become an adoptive father within the subsequent 6 months of the child’s birth are entitled to 2 weeks of paid leave which can be taken up to 6 months following the birth of the child and maybe split up in daily or weekly increments. Fathers will receive compensation equal to 80% of their income capped at 196 Swiss francs (CHF) per day. Swiss Code of Obligations, March 30, 1911, art. 329(g).
An employee who has a seriously ill child or a child impaired due to an accident is entitled to paid leave for a maximum period of 14 weeks. If both parents are employed, each parent is entitled to childcare leave of a maximum of 7 weeks. Leave can be taken at one go or by the day. This leave shall be taken within a time period of 18 months calculated from the first day, the daily allowance has been drawn. Swiss Code of Obligations(amended Dec 2019) art. 329(i).
Employees are entitled to paid leave for family responsibilities. Family responsibilities include bringing up children up to the age of 15 and caring for relatives or close people in need of care. These employees may only be used for overtime work with their consent. At their request, they are to be granted a lunch break of at least 1.5 hours.
On presentation of a medical certificate, the employer must grant the employee leave to look after a family member or partner with a health condition. The leave is limited to the duration required for the care but amounts to a maximum of 3 days per event. With the exception of children, the care leave is a maximum of 10 days per year. Labor Act, ArG, 1964, Arts 36, Swiss Code of Obligations Art 329h.
An employee who adopts a child shall be entitled to adoption leave of 2 paid weeks. The adoption leave must be taken within one year of adopting the child. It may be taken by one parent or shared between both parents. Both parents may not take their share of leave at the same time. It may be taken in full weeks or on a day-to-day basis. Swiss Code of Obligations, March 30, 1911, art. 329(j).
Employees under 30 years of age are entitled to 1 working week of leave without pay per year to do volunteer work for a social or cultural organization. Any leave for youth work not taken by the end of the calendar year is forfeited. An individual employment contract or collective employment contract may provide employee benefits for such leaves. Leave days not taken expire at the end of the calendar year.
Leave for Military Duty – In addition, employers must provide leaves of absence to employees for the performance of their compulsory military duties. Swiss Code of Obligations, March 30, 1911, arts. 329.