Payroll and Benefits Guide Switzerland – Geneva

Employer

Employer Payroll Contributions

Employee

Employee Payroll Contributions

Employee Income Tax

General

Switzerland has no national minimum wage. However, minimum wages can be established by way of collective bargaining agreements, or by canton ruling, for example:

Canton wage level (per hour):

Geneva – 24 CHF

Basel City – 21 CHF

Neuchâtel – 20.08 CHF

Jura – 20 CHF

Ticino – 19 CHF

Winterthur – 23 CHF

Zurich – 23.90 CHF

Payroll Cycle

Employees must be paid monthly by the last working day, however, the pay date is typically by the 25th of the month.

13th Salary

A 13th salary is not compulsory, but it is very common and, if due, will be outlined in the employment contract or collective bargaining agreement.

General

A 40-44 hour workweek is common, dependent on collective bargaining agreement in place. Working hours are calculated on a yearly basis, provided that the certain cumulative conditions are met.

Geneva: Contractually agreed working hours are 40 or 42 hours per week. Depending on the field of work, the maximum number of working hours per week is either 45 or 50 hours.

Overtime

Geneva: Overtime work is compensated at 125% of the regular pay rate (capped at 2 hours per day), or time off is given in lieu of payment.

Working Week

Monday–Friday

Paid Time Off

Employees over the age of 20 and under 50 receive 4 weeks of paid holiday. Under the age of 20 and over 50 receive 5 weeks of paid holiday. The annual leave cycle is the calendar year. Carryover of vacation days is permitted, the carryover policy is determined by the employer. Unused vacation days are paid out upon termination of employment.

Public Holidays

Most public holidays are set by each individual canton.

Public holidays that fall on the weekend are usually lost.

Sick Days

All employees are entitled to paid sick leave based on the number of years of continuous employment. During the first year of employment, the employee receives up to 3 weeks of paid sick leave.

Alternatively, employers and employees may agree to opt for a daily benefits insurance scheme where employees will receive up to 80% of their last salary for a maximum of 720 days. the employee is required to provide a doctor’s note.

Maternity Leave

Maternity allowance is given to employees who have contributed to the OASI for at least 9 months preceding the delivery and have worked for at least five months.
Mothers (both full-time and part-time employees) are paid 80% of their wages in the form of a daily allowance for 98 days (up to a maximum cap of SFr 196 per day).

However, Geneva law provides an additional two weeks, amounting to a total of 16 weeks. The employee is required to provide the birth certificate.

Paternity Leave

Fathers in Switzerland are entitled to 10 days of paid paternity leave and federal employees will now be entitled to 4 weeks of paternity leave. This leave can either be taken either on a weekly basis (weekends included) or on the basis of individual days.

As is the case with maternity leave, weekends are included in the compensation. Consequently, the father has 14 daily allowances and is entitled to a total of 10 days off work. The paternity leave must be taken within six months of the birth of the child and the employee is required to provide the birth certificate.

Paternity leave benefits will equal 80% of the employee’s average salary prior to the baby’s birth but will be capped at a total of CHF220 per day.

Parental Leave

There are no statutory laws on parental leave.

Other Leave

Care leave: 14 weeks of paid leave to provide care for a seriously ill or injured child. The employee is required to provide a doctor’s certificate.

Death leave: The law does not specifically define how many hours or days an employee can take off in case of a relative’s death. Employers may decide this. Normally, three days to five days are given in case of close relatives and one to three days in other cases.

Wedding leave:  The law does not specifically define how many hours or days an employee can take off in case of a wedding. Employers may decide this. Normally one to three days are given.

Termination Process

Termination in Switzerland has the principle of freedom of dismissal, making it possible to terminate a contract of employment without there being an important reason, provided that such termination is not discriminatory or abusive. The reason for the dismissal must be explained when the other party requests it. Even if the dismissal is valid through oral termination, it is advisable to do so in writing for evidentiary purposes.

Notice Period

Termination is considered legally valid from the moment the recipient receives it.
The statutory notice periods are as follows:

• 7 days during the trial period
• 1 month during the first year of service
• 2 months during the second to the ninth year of service
• 3 months from the tenth year of service

Alternatively, the parties can contractually agree on a notice period. Notice begins at the end of the calendar month. Garden leave can be utilized during this period.
A fixed-term employment contract ends upon the expiry of the agreed period.

Severance Pay

Severance pay is stipulated within the employment contract or collective bargaining agreement. In addition, the statutory severance payment is only applicable to employees of at least 50 years of age who have completed at least 20 years of employment and provided there is a shortfall in pension benefits. Due to this last condition, this statutory entitlement is very rare. The severance payment due in this instance is calculated at between two and eight months’ pay.

Probation Period

The probation period is 1-3 months for indefinite employees.

General

• Mobile phone allowance
• Work from home allowance

VISA

In Switzerland, there are two ways you can obtain a residence permit. This permit grants the permission to work in Switzerland:
A citizen of an EU member state or a citizen of the European Free Trade Association (and can enter Switzerland for 3-6 months while they search for a job):

• L (short-term resident): This is a permit valid from 3-12 months for individuals that have a valid employment contract.
• B (resident foreign nationals): This permit is for foreign nationals that have a valid employment contract for at least 12 months. This permit is valid for up to 5 years and can be extended automatically if the duration of the employment is extended.
• C (settled foreign nationals): This permit is valid indefinitely after one has resided in Switzerland for 5 uninterrupted years.
• G (cross-border nationals): For citizens who work in Switzerland but reside in a different country. Cross-border commuters must return home at least once a week.

Note that the EU Blue Card is not valid in Switzerland.

Non-EU/EFTA nationals: When an EU/EFTA citizen cannot be hired for a job, a company can extend a job offer to a third-party national. The employer must be able to show that they have made efforts to hire an EU/EFTA or any individual that already resides in Switzerland and must be able to show why the candidate was not fit for the job. For non-EU/EFTA nationals, permits L, B, and C can be applied for.

However, there is no limit to how long it may take to obtain the work permit.

General

VAT is 7.7% standard rate.