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Under the Swiss Code of Obligations, both full-time and part-time employees are entitled to a minimum of 4 weeks of paid annual vacation after the first year of service (5 weeks for employees under 20 years of age). If the employee has worked for less than 1 year, the duration of annual leave is fixed pro-rata.

If employees fall sick during their leave, they are entitled to postpone their leave by providing a medical certificate to their employees. They can also take any remaining days of leave during their notice period or a cash payment in lieu of leave days.

Employees need their employer's approval to take time off. If their leave days are not compatible with the company's needs or interests, their employer can ask them to reschedule. At least 2 weeks of annual leave must be taken consecutively.

Employers must pay their employees the full salary due for the holiday entitlement and fair compensation for any lost benefits in kind. During the employment relationship, the holiday entitlement may not be replaced by monetary payments or other benefits.

Employees are entitled to full salary payment during sick leave if they have worked for more than 3 months. During the first year of employment, the entitlement to sick pay is limited to 3 weeks: after that, it is extended based on the years of service. The duration of leave also varies among cantons: in the canton of Zurich, for instance, sick pay is due for 3 months at 100% and 3 months at 75% of the wages in the first year of service, 6 months at 100% and 6 months at 75% in the second year, and 12 months at 100% from the third year of service.

Employees must submit a medical certificate to their employers no later than on the third day of illness to receive the benefit.

By written agreement, the employer's statutory obligation to sick pay can be replaced by insurance that issues daily allowances of up to 80% of the employee's wages. Employers pay at least half of the premium amounts. The wage payment may continue for the duration of the employee's inability to work but cannot exceed 720 or 730 days within 900 consecutive days.

Under the Swiss Code of Obligations, the right to maternity leave applies to full-time, part-time employees, and self-employed persons if they were insured under the OASI/AHV scheme for 9 months prior to childbirth and have worked for at least 5 months during their pregnancy. The minimum length of maternity leave is 14 weeks, starting from the delivery date. Employees who return to work before the end of the maternity leave lose their entitlement to compensation. Women are not allowed to work for 8 weeks after giving birth. If an employee adopts a child, they are entitled to 2 weeks of adoption leave.

In the event of the newborn child's hospitalization, the paid maternity leave is extended to a maximum of 56 days. If the other parent passes away within 6 months after the child’s birth, the female employee is entitled to an additional 2 weeks of leave. This leave may be taken either in full weeks or on a daily basis, within 6 months from the day following the parent’s death.

The employer is prohibited from terminating the employee's labor contract during her maternity leave and for 16 weeks after childbirth. Discrimination based on pregnancy is not permitted at any stage of the employment relationship, including during hiring.

Switzerland grants 2 weeks (14 days) of paternity leave to employees. It is available to working fathers as well as working mothers. This leave can be taken within 6 months of birth and can be taken in full weeks or on a day-to-day basis. If the mother dies on the day of the birth or 14 weeks thereafter, the other parent is entitled to 14 weeks of leave. If the child is hospitalized, they are entitled to leave for the duration of the hospitalization, up to 8 weeks. If an employee adopts a child, they are entitled to 2 weeks of adoption leave.

The father or the mother's wife must have been compulsorily insured with the AHV (Old-Age and Survivors' Insurance) during the 9 months immediately preceding the birth of the child, and must have been gainfully employed for at least 5 months during this period.

Compensation is paid for income lost while on paternity leave as 80% of the average earned income before the birth of the child, up to a maximum of CHF 220 (Swiss Francs) per day. Fathers have no legal right to extend their paternity leave. They must arrange with their employer if they wish to do so.

Employees who take their leave in weekly increments receive 7 daily allowances per week. Those who take their leave in daily increments receive an additional 2 daily allowances for every 5 days of leave taken.

Minimum Wage

Swiss law does not specify minimum wage or average earnings. In most cases, salary levels are agreed upon between the employer and the employee during the recruitment process.

The following cantons in Switzerland have set minimum wages:

• Neuchâtel - CHF 21.35 (Swiss francs) per hour
• Jura - CHF 21.40 per hour
• Ticino - CHF 20-20.50 per hour
• Geneva - CHF 24.59 per hour
• Basel-Stadt - CHF 22.20 per hour
• Lucerne - CHF 22.75 per hour
• Law - CHF 21.40 per hour

The frequency of payment can be determined by an individual employment contracts. Unless otherwise provided by agreement or custom, the salary must be paid to the employee in legal tender during working hours; a written salary statement must be provided to the employee.

Overtime, Holiday & Vacation Pay

Overtime working hours (above 45 to 50 hours depending on the sector) may be compensated either by a rest period or with a premium of 25%. Employees can waive the right to overtime pay and compensation by time off for work exceeding the contractually agreed hours. Such a waiver must be in writing and is only effective ex-ante (i.e., for overtime pay not yet earned).

Work done on weekly rest days is compensated with a 50% premium.

If a public holiday falls on a non-working day (e.g., Saturday or Sunday), compensation is not provided. Work on public holidays is treated the same as work on weekly rest days and is compensated with a 50% premium.

Employees are entitled to full pay while on their annual leave.

Notice Period

Per the labor law of Switzerland, the statutory notice periods are:

• 7 days during probation
• 30 days in case of mass redundancy
• 1 month from the last day of the month in the first year of service
• 2 months from the last day of the month for the second through the ninth year
• 3 months from the last day of the month from the tenth year of service

Notice can be given in writing or orally. Parties may agree on a different notice period. Such an agreement must be in writing, and the agreed notice period must not be less than 1 month.

Fixed-term employment contracts generally end on the agreed-upon date. However, they may be terminated early in the following circumstances:

• Serious cases
• The contract contains provisions for early termination
• Mutual agreement between the employer and employee

Fixed-term agreements for more than 10 years require 6 months' notice.

Severance Benefits

Severance is paid only in case of dismissal of employees above 50 years of age with tenure of at least 20 years. The minimum severance payment cannot be below 2 months and exceed 8 months of salary. If the employee receives benefits from an occupational benefits scheme, these benefits may be deducted from the severance allowance to the same extent they were funded by the employer either directly or through the contributions to the occupational benefits scheme.

Pension

The pension system in Switzerland has 3 general components:

• Minimum standard of living: State Benefits (OASI: Old Age Survivors Insurance). Compulsory for everyone
• Securing current standard of living Occupational pension. Compulsory for most salaried persons
• Individual supplement (choice required/not mandatory): Private Pension

Both employees and employers are required to pay contributions. Employee contributions are deducted directly from their salary. To receive the full pension, both the employee and the employer must have made payments without interruption from the time the employee was 20 until the time they reach retirement age.

The level of the pension an employee receives then depends on their average annual income. The minimum and maximum levels are as follows:

• A pension of CHF 1,260 per month if an employee has paid OASI contributions without interruption and the average annual income did not exceed CHF 16,800
• A pension of CHF 2,520 per month if an employee has paid OASI contributions without interruption and their average annual income was at least CHF 88,200

Employees who earn at least CHF 22,680 per year are required to contribute to the Occupational Pension scheme. The pension is paid as an annuity. The minimum annual pension benefits in this scheme amount to 6.8% of the total retirement savings.

From 2026, all old-age pension recipients will receive an additional monthly pension payment in December. This payment is made as a supplement to the December pension payment.

Dependents/Survivors Benefits

In Switzerland, to prevent financial hardship after the death of a spouse or a parent, the survivors (spouse, registered same-sex partner, children) receive a surviving dependents’ pension. A distinction is made between a widow’s, a widower’s and an orphan’s pension. Amounts paid range from CHF 1,008 to 2,016 per month.

Children under 18 years of age or 25 years, if they are students or apprentices, are eligible for pension if one of their parents dies. The amount of pension is 40% of the old-age pension, which equals a minimum of CHF 504 and a maximum of CHF 1,008 per month if there are no gaps in contributions. If both the parents die, orphan's pension is doubled, limited to 60% of the maximum old-age pension, i.e., CHF 1,512 per month.

Survivors are entitled to a surviving dependents’ pension provided the deceased paid AHV (Alters- und Hinterlassenenversicherung) contributions for at least 1 year.

Invalidity Benefits

Disability insurance (IV/AI) is a compulsory social insurance scheme. This insurance covers all individuals who live in the country. Swiss citizens or citizens of EU and EFTA member countries can also make voluntary contributions to Swiss invalidity insurance if they live outside of their countries.

The insured must be assessed with a disability of least 40% and be over 18 years of age. Pension is paid as a linear curve between 25% to 47.5% of the pension for 40 to 49% disability, and 100% pension for at least 70% disability. The pension rate for individuals with a degree of invalidity of 50–69% will correspond exactly to their degree of invalidity. Helplessness Allowance is paid to individuals who are not able to carry out essential day-to-day tasks without any assistance. Personal Assistance Allowance is paid to recipients of helplessness allowance who require assistance regularly but would still like to remain in their own home to hire a person who can provide them with the necessary help.

Personal Income Tax

All tax-resident individuals are taxed on their worldwide income and wealth. Non-tax-resident individuals are required to pay tax on income from sources in Switzerland.

Income taxes are levied at federal, cantonal, and municipal levels. The cantons are free to set their tax rates. The municipal taxes are based on the cantonal tax laws; however, municipalities set their own tax rates.

Federal tax rates are progressive from 0.77% to 13.2% for single taxpayers and 1% to 13% for married taxpayers.

Visas

Switzerland is a part of the Schengen Agreement. Citizens of countries that are a part of the European Union (EU) and the European Free Trade Association (EFTA) have the right to enter, live, and work in Switzerland without additional permits or visas for stay up to 90 days. For stays longer than 90 days, they must obtain a residence permit.

Non-EU nationals may apply for either:

• Type C (Schengen) visa - allows staying in the country for up to 90 days within 180 days of the visa issue date; this visa type does not automatically grant the person the right to work.
• Type D visa - for longer-term stays (over 90 days). It is usually distributed in conjunction with a work permit.

Work Permits

Switzerland has a dual system for the admission of foreign workers. Nationals from European Union (EU) or European Free Trade Association (EFTA) countries benefit from the Agreement on Free Movement of Persons and, in general, do not need a work permit if they reside in Switzerland. There are certain restrictions and exceptions for nationals from the new EU countries.

In regard to non-EU and non-EFTA nationals, only a limited number of management-level employees, specialists, and other qualified individuals are admitted from all other countries.

The following types of permits are issued in Switzerland:

• Permit L – a short-term residence permit that allows a person to stay in Switzerland for up to 1 year, tied to the employment contract with a possible extension for an additional year in exceptional cases.
• Permit B – an initial or temporary residence permit that is valid for one year but can be extended annually; EU or EFTA nationals wishing to be self-employed can get a B permit valid for five years if they can prove that their financial success is possible through self-employment.
• Permit C – a settlement permit for persons who have been living for ten continuous years in Switzerland; an exception is made for the US and Canadian citizens who only have to live in Switzerland for five consecutive years to apply for a settlement permit.
• Permit G—there are two types of permits for cross-border commuters: a permit that expires between 3 months and 1 year for those with an employment contract of the same duration, and a permit that expires after 5 years for contracts of 1 year or longer.

Young people may not be employed before turning at least 15 years of age. Exceptions are made for children under 15 for work at cultural, artistic, or sporting events and in advertising. Light work is allowed for children over 13 years of age. In the cantons where compulsory schooling is completed before the age of 15, other exceptions from this rule may be authorized under certain conditions for young people age 14 and over.

The working hours of young people under 18 years of age cannot exceed those of the other employees in the company and be above nine hours a day. Young people up to the age of 16 may be employed until 8:00 PM. and young people over 16 years of age until 10:00 PM. Employees under the age of 16 years are not allowed to work overtime or on holidays.