Foreign Employers Face Penalties For Noncompliance With Working And Wage Conditions Regarding Notification Procedure



Under the Agreement on the Free Movement of Persons, nationals of EU and European Free Trade Association (EFTA) states have the right to freely choose their place of work or residence within the territories of the contracting parties. Cross-border services from EU and EFTA states to Switzerland may be provided for a maximum of 90 working days per calendar year without a formal work permit.

Accompanying measures have been introduced to protect workers from the risk of non-compliant working and wage conditions that could occur with the free movement of persons. The measures are largely regulated by the Federal Act on Posted Workers and its ordinance, and impose various obligations on foreign employers and companies, which are subject to appropriate penalties.

Foreign employer duties

In case of an assignment, the foreign employer has the following duties:

Notification obligation - assigned employees must be notified at least eight days before the start date of the assignment in Switzerland. Minimum working and wage conditions - the minimum working and wage conditions foreseen by Swiss law must be guaranteed for the entire duration of the assignment. Housing, boarding and travel costs - in addition to the minimum Swiss salary, all housing, boarding and travel expenses of the assigned employee must be borne by the employer. Proof of self-employment for self-employed service providers - must provide proof that they are self-employed. Penalties

Administrative penalties

According to the Federal Act on Posted Workers, administrative penalties for violations include penalties of up to Sfr30,000 and a ban to provide services in Switzerland for a period of one to five years. The infringements are listed on a public list on the State Secretariat for Economic Affairs' website.

Competent authorities may impose the following administrative penalties for violations of the obligations contained in the Federal Act on Posted Workers:

violation of the notification obligation - up to Sfr5,000; violation of the documentation obligation for self-employed workers - up to Sfr5,000; violation of the minimum working and wage conditions - up to Sfr30,000 or a one to five-year ban on providing services. For serious offence against minimum working and wage conditions, a penalty and a ban can be cumulated; and violation of housing regulations - up to Sfr5,000. Where minimum wage conditions are violated, penalties may be adjusted based on...

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