TL;DR, Hiring in Switzerland
- Fully-loaded employer cost: ~15.5% to the AHV/IV/EO cap, ~7% above (pension + accident only)
- Pension (BVG/LPP) employer contribution is age-banded: 3.5% at 25 → 9% at 55+
- 13th-month salary is customary but not federally mandated, so it is shown as conditional and not added to the estimate
- No statutory minimum wage federally, but Geneva, Neuchâtel, Jura, Ticino, Basel-Stadt set cantonal minimums
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Statutory employer costs in Switzerland
In Switzerland, employer social-security contributions total ~15.5% of gross salary up to the AHV/IV/EO contribution base. The breakdown: AHV (old-age) 4.35%, IV (disability) 0.7%, EO (loss of earnings) 0.25%, ALV (unemployment) 1.1% capped at CHF 148,000, BVG/LPP (occupational pension) 3.5–9% age-banded above the entry threshold, plus accident insurance (UVG) 0.5–2%. Above the salary cap only BVG and accident insurance continue (~7%). 13th-month salary is customary in most German- and French-speaking cantons.
| Contribution | Employer rate | Notes |
|---|---|---|
| AHV / IV / EO (old age, disability, loss of earnings) | 5.3% | Employer share (matched by employee). Flat, no cap on all earned income. |
| ALV (unemployment insurance) | 1.1% | Capped at CHF 148,000/year (2026). The former solidarity surcharge above the cap was abolished in 2023. |
| BVG / LPP (occupational pension) | 3.5–9.0% | Age-banded: 25–34 = 3.5%, 35–44 = 5.0%, 45–54 = 7.5%, 55–65 = 9.0%. Minimum legal floor; many employers contribute more. |
| UVG (accident insurance) | 0.5–2.0% | Occupational accident: 100% employer-funded. Non-occupational accident: typically 50/50. Premiums vary by SUVA risk class. |
| Family allowances (CAF/FAK) | 0.3–3.6% | Cantonal: varies widely (Geneva ~2.5%, Zurich ~1.3%, Vaud ~2.0%). 100% employer-funded. |
Mandatory employee benefits
Beyond statutory contributions, Switzerland law requires the following benefits the employer must fund.
- Annual leave
- Code of Obligations Art. 329a: 4 weeks (20 days) statutory minimum for employees aged 20+, 5 weeks for under-20s and over-50s. Most white-collar offers grant 5 weeks regardless.
- 13th-month salary
- Not federally mandated but customary (~90% of white-collar contracts). Typically paid in December, pro-rated for partial years.
- Sick pay
- Code of Obligations Art. 324a 'Bernese / Basel / Zurich scales': 3 weeks in year 1, rising by tenure. Most employers carry collective sickness insurance (KTG) covering 80% for up to 720 days.
- Maternity leave
- 14 weeks paid at 80% via EO (federal), max CHF 220/day. Geneva, Vaud, Ticino top up. Paternity: 2 weeks paid at 80% (since 2021).
Termination, notice and severance
Probation
Maximum 3 months under Code of Obligations Art. 335b. Notice during probation: 7 days unless contract specifies otherwise.
Notice period
Tenure-stepped under Art. 335c: 1 month during year 1, 2 months years 2–9, 3 months from year 10. Always ending on the last day of a calendar month. Contracts may extend but not shorten.
Severance
No statutory severance under Code of Obligations except for employees 50+ with 20+ years of service (Art. 339b), between 2 and 8 months' salary. Abusive dismissal (Art. 336) caps damages at 6 months' salary. Most exits negotiate a 'plan social' or settlement, especially in regulated sectors.
Common compliance pitfalls
- BVG age-banding means hiring a 55-year-old costs nearly 6 percentage points more in pension than hiring a 30-year-old. Materially affects total cost-to-hire on senior roles.
- Cantonal differences are significant; Geneva's family-allowance levy is ~2.5% vs Zurich's ~1.3%. Source taxes for foreign workers also vary by canton. EOR providers using a single 'CH average' rate under-cost some cantons.
- 13th-month salary is contractual, not statutory, so this estimate does not include it. Skipping it makes offers visibly substandard and most EOR contracts default to 13 months, so add one month of pay to the figures here if you intend to grant it.
- Cross-border commuter (Grenzgänger) hires from France, Germany, Italy add layers: G-permit, frontier-worker tax agreements, and home-country social-security election under EU 883/2004. EORs often default to standard CH treatment incorrectly.
Frequently asked questions
EOR platform fees for Switzerland range from $199–$699 per employee per month. On top, employer social-security contributions total ~15.5% of capped salary plus BVG pension (3.5–9% age-banded) and accident insurance (0.5–2%). Total employer cost typically runs 17–22% above gross, modest by OECD standards, but the absolute CHF base is high.
No. The Code of Obligations does not mandate 13th-month pay. However, it is customary in ~90% of white-collar contracts, especially in German-speaking and French-speaking cantons. Ticino similarly. Omitting it makes offers visibly substandard, and once granted, it becomes a contractual right that cannot easily be withdrawn.
Switzerland's mandatory occupational pension (BVG/LPP) requires employer contributions that scale with employee age: 3.5% at 25–34, 5.0% at 35–44, 7.5% at 45–54, 9.0% at 55–65 (minimum, often higher). A 55-year-old senior hire costs roughly 5.5 percentage points more in pension than a 28-year-old peer on the same salary.
Functionally yes, but with statutory notice periods (1–3 months by tenure, ending on a calendar month-end) and a narrow 'abusive dismissal' carve-out (Art. 336) where damages cap at 6 months' salary. There is no general just-cause requirement, but termination during pregnancy, military service, or illness is void. Most large terminations negotiate a plan social.
Foreigners holding B, L, or G permits (not C permits or Swiss citizens) are taxed at source: the employer withholds Quellensteuer at cantonal rates and remits monthly. Rates vary significantly by canton (e.g. Geneva ~22% effective vs Zurich ~17% on a CHF 120k single-filer). EOR providers typically handle this, but verify the canton-specific rate is applied.
Sources
Statutory rates and rules verified against the following authorities. We update this page when rates change.