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 in most cantons but not federally mandated
- 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 148,200, 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 148,200/year (2025). +0.5% solidarity contribution above the cap (employer share). |
| 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, but skipping it makes offers visibly substandard. Most EOR contracts default to 13 months — confirm before signing to avoid surprise.
- 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
Sources
Statutory rates and rules verified against the following authorities. We update this page when rates change.