Planning to hire employees in Switzerland? Here’s a quick guide

With 26 cantons in Switzerland, employment rules and processes can vary significantly from one region to another. This makes hiring in Switzerland more complex, especially for employers managing talent from abroad. 

Work permit requirements also differ between EU and EFTA nationals and non-EU/EFTA nationals, and the rules can change depending on how long an employee plans to work in the country.

Because of such differences, many companies turn to workforce management platforms like Payoneer Workforce Management for support to navigate the local employment landscape. 

It helps businesses stay aligned with local requirements while making it easier to manage onboarding, payroll, taxes, and benefits in one place.

In this guide, we’ll walk you through key aspects of the hiring process in Switzerland, such as onboarding, employee benefits, and important legal considerations. 

We’ll also explore different ways to hire in Switzerland, including using a workforce management platform, so that it can help navigate compliance and make global hiring more manageable.

How to hire in Switzerland

To engage talent in Switzerland, you have to make sure that you abide by the local labor laws of the country. 

There are three ways in which you can engage people in Switzerland: 

1. By setting up a legal entity in Switzerland

If you are an organization looking forward to expanding your business into Switzerland, the typical process is to open a bank account and register as a local business. This makes interaction with Swiss government services easy, thereby reducing the risk of non-compliance. 

This, however, may not be a suitable solution for businesses seeking quick market entry or engaging a few people, as the process is time-consuming and expensive. 

2. By hiring contractors

This is one of the most convenient options for businesses planning to accomplish tasks in a time-based manner. Contractors are, however, in charge of their own schedule, taxes, and rates. You cannot direct their work or take disciplinary action against them. 

While onboarding contractors, you have to be careful about not misclassifying them, which could otherwise lead to government fines and penalties. 

3. By using a workforce management platform

You can engage talent through a third-party workforce management platform that onboards employees on your behalf. 

A workforce management platform like Payoneer Workforce Management helps with employment contracts, employee taxes, benefits, payroll, leaves, etc. 

Payoneer Workforce Management also takes local laws and regulations into consideration when engaging employees, thereby facilitating easy workforce management in Switzerland. 

Where to find employees in Switzerland

Hiring talent in Switzerland begins with sourcing candidates through appropriate job platforms and localized outreach. 

You should focus on region-specific channels and provide multilingual support to enhance reach and manage recruitment effectively.

1. Popular job boards in Switzerland

Post your job openings on the job boards in Switzerland. Some popular job boards are:

• arbeit.swiss
• jobs.ch
• Indeed Switzerland
• LinkedIn
• SwissDevJobs.ch
• MedTalent
• itjobs.ch / ictjobc.ch
• Jobs4Sales.ch

2. Work with local recruitment agencies

Even if the job requires English, offering support in local languages like German, French, or Italian can make the hiring process in Switzerland easier for both you and the candidates. 

Clear communication is especially important when discussing salaries and signing contracts, which is why many employers work with local recruitment agencies.

However, this can add to the cost, as agencies usually manage a large part of the hiring process.

3. EOR support

An EOR does more than just payroll processing. It can help you draft employment contracts for employees and onboard them while considering the local labor laws. 

This way, you can engage in other important tasks like screening the resumes, identifying suitable people and conducting interviews, while leaving the rest to experts.

Onboarding employees in Switzerland

While hiring talent in Switzerland, you have to ensure a good onboarding experience for the local candidates. 

The rules may be different for onboarding employees of varying nationalities, i.e., EU and non-EU. 

• Issuing an employment contract: You have to issue an employment contract to your employee. The contract must contain all the details of the employment, such as the names of the employer and employee, type of employment, the date of commencement of the employment, the role for which the employee has been hired, salary and allowances, weekly working hours, and so on.
• Social security registration: You have to register your new employees in Switzerland’s social security system. The three pillars of Switzerland’s social security system are: 
  1. Old-age and survivor’s insurance and invalidity insurance scheme
  2. Occupational pension fund
  3. Optional private savings scheme 
• Work permit: Employees have to obtain a work permit. The rules differ for employees belonging to different geographical regions. 
• Local registration: After employees arrive in Switzerland, they have to secure a local registration at the local municipal office (Gemeinde or Commune) within 14 days of arrival.

Key employment laws and requirements in Switzerland

When employing individuals in Switzerland, understanding statutory benefits and adhering to applicable regulations is crucial. 

Below are some key requirements employers should keep in mind.

Employment contracts

You and your employee should have a written employment contract duly signed by both parties. These contracts list the rights and obligations of both parties in the employment relationship.

An employment contract should include the following:

• Employer and employee’s name and other personal details.
• The type of employment contract.
• The role for which the employee has been hired and its description.
• The date of commencement or conclusion (if any) of the contract.
• The employee’s salary, other allowances, and benefits.
• The employee’s weekly working hours.
• Any additional special rules that may be applicable.

Employment benefits

Employees in  Switzerland enjoy a range of benefits, some of which are mentioned below:

• Employees get 4 weeks of paid annual leave in the first year of service and 5 weeks after one year. 
• The minimum wage of employees depends on the canton in which they are working. Some minimum wages are CHF19 (Ticino), CHF20 (Jura), CHF20.08 (Neuenburg), and CHF24.32 (Geneva) per hour. 
• There is no standardized law for sick leave in Switzerland. When an employee takes sick leave, you have to pay the employee for the first 15 days. Thereafter, the employee shall be paid by the National Insurance Scheme. 
• Employees are entitled to a paid maternity leave of 14 weeks and paternity leave of 2 weeks. 
• Employees shall also get other leaves like compassionate leave, wedding leave, and leave for military recruitment. 
• Employees are entitled to a social security fund that involves three pillars: old-age and survivors’ insurance and invalidity insurance scheme, occupational pension fund, and an optional private savings scheme. 

For a detailed breakdown of employer contributions and employment costs, use our employee cost calculator.

Working hours and holidays

Have a look at the laws in Switzerland with respect to working hours and holidays:

• The limit for working hours per week is 40 hours. 
• If you engage your employees to work overtime, you have to pay them a supplement of at least 40%. 

There are 12 public holidays in Switzerland. However, the public holidays vary based on the cantons. 

Some of the common public holidays in Switzerland are: 

• New Year’s Day
• Good Friday
• Easter Monday
• Ascension day
• Whit Monday
• National Day
• Jeune genevois
• Christmas Day
• Restoration day. 

The regulations vary from one canton to another. Many Swiss events overlap with those in Germany. 

Tax obligations

In Switzerland, there is no one-size-fits-all approach to income tax. An employee’s tax liability varies based on their individual circumstances as well as the canton they reside in.

Termination and severance

If you terminate an employee, you have to show enough reason to support your decision. 

Termination of an employment contract may be considered valid under the following circumstances: 

1. Ordinary dismissal 
2. Dismissal for a specific cause 
3. The employee’s decision to dissolve the employment contract 
4. Both you and the employee mutually decide to dissolve the employment contract 
5. Automatic termination of a fixed-term employment

The termination should be documented in writing, and you have to provide a written notice to the employee. 

Notice period

• If an employee is dismissed during probation, a notice period of 14 days has to be observed. 
• If employees have to be dismissed after probation, the notice period shall depend on the employee’s seniority. In this case, the notice period ranges between 1 and 6 months. 

The notice period begins on the first day of the month following the month when the notice letter is issued. This helps maintain proper communication and adhere to the employment laws regarding termination. 

Severance pay

If you dissolve an employment contract of an employee aged more than 50, having served at least 20 years, you have to pay a severance amount equal to at least two months’ salary. 

In case the court decides that an employee has been terminated in an unjustified manner, you shall have to pay the employee 6 months’ salary as indemnification. 

Explore Payoneer Workforce Management in Switzerland

Hiring in Switzerland can be difficult, as local laws affect everything from recruitment and salaries to taxes and benefits. For companies hiring across countries, keeping up with these rules can take a lot of time and effort.

Payoneer Workforce Management helps you navigate and manage the employment regulations in Switzerland and makes it easier to hire and manage employees.

A workforce management platform like Payoneer Workforce Management can facilitate global hiring by helping you-

• Onboard employees easily
• Run payroll across countries
• Navigate compliance with local laws
• Manage taxes, contributions, timesheets, benefits, and more in one place

Speak with an expert today to see how Payoneer Workforce Management can support.

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