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SWITZERLAND: Annual Update – Expected Labour Law Changes in 2017

By - - Employment Law

Immigration

Restrictions on immigration:   The new constitutional Article (121a) voted by the Swiss population on February 9, 2014 must be implemented by February 2017. However, it appears that the Federal Council does not wish to apply the full restrictions approved in the referendum and is currently trying to find alternative solutions.

A confirmation of the Parliament’s draft is expected in December 2016, and a counter-proposal of the Federal Council on the new initiative should be published in April 2017.

The position therefore remains uncertain. The Swiss government is trying to propose alternatives to the strict application of Art. 121a, according to which immigration quotas should be implemented. Even if it seems that the government wishes to opt for a “lighter” version of foreign workforce restrictions, it remains possible that quotas will be introduced.

Action required: Employers should therefore be ready to deal with more difficulties in recruiting foreign employees by 2017 or 2018 at the latest.

Posted Workers

Limitation of secondment cost reimbursement for posted workers:  Proposed changes to rules on Foreign Nationals and Posted Workers are currently under consultation. In relation to posted workers in Switzerland it is proposed that the secondment allowance paid by the employer to the posted worker be limited in case of long-term secondment. Collective labour agreements are however protected.

Parliament still has to vote on the draft legislation. A date for the entry in force has yet to be fixed.

Action required: If the secondment allowance is reduced, it will be more advantageous to send long-term posted workers to Switzerland in the future. However, it will not be possible to diminish the allowance for posted workers who are already under contract. In such cases, a modification of the employment contract will be necessary.

Sanction for breach of minimum salary rules:  There are proposals to increase the sanction cap currently in force in case of breach of the provisions relating to minimum salary. The maximum administrative fine will rise to CHF 30’000.- instead of CHF 5’000.- currently.

A date for the entry in force has yet to be fixed.

Action required: Foreign employers who send posted workers to Switzerland will have to certify to the Swiss employer that the minimum salary conditions applicable in Switzerland are respected.

Internships

New criteria on internships in Geneva:  Geneva Authorities have introduced criteria for determining whether an employment is an internship or not. If the internship does not take place within an education or a social or professional re-integration program, it is a “real” job and must be paid accordingly. The Geneva authorities may issue a standard contract imposing minimal salaries for all types of internships, if the guidelines are not voluntarily followed.

The criteria are already in force and applicable.

Action required: Employers who are active in Geneva should check how they hire interns. If they are hired outside an education or re-insertion program, they are entitled to be paid the usual salary for the role. However, there are currently no coercive measures for employers who are not subject to a collective labour agreement.
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