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Employing staff as a foreign business in Switzerland: what you need to know

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Introduction and considerations
Employing staff as foreign employer in Switzerland brings along various statutory challenges in the start-up phase. For obvious reasons, companies want to keep the organisation of such an endeavor as lean as possible. However, it still requires the necessary attention to ensure compliance. The fact that Switzerland is not a Member of the EU adds an extra layer of complexity.  

Over the last number of years, we have helped our customers to navigate through the dynamically changing statutory landscape. The changing relationships between Switzerland, the EU and the rest of the world requires foreign employers to plan this endeavor in a meticulous manner. 

What do foreign employers need to consider whenever employing staff in Switzerland? What are the best scenarios for small operations to have successful start as foreign employer in Switzerland? 

Immigration
Switzerland is known for its highly skilled and productive workforce. However, its tremendous economic success has also led to a war for talent in the Swiss labour market. To keep up its high standard, Switzerland is dependent on an annual influx of workers from abroad. Switzerland has a tight network of bi- and lateral agreements with the EU, the EFTA and third-party countries which govern immigration. As an employer in Switzerland, it is key to understand how these agreements affects the employment or assignment of citizens/individuals employed by a foreign employer.

Compensation and benefits
The legal framework-related social security and social insurances determine employees’ insurance coverage. It is the employer’s responsibility to provide the appropriate coverage. The regulatory framework is clear on the insurance company’s obligations; however, the reality is somewhat different. It can become a daunting experience to find an appropriate solution. The administrative side of things is just one side of the coin. The end-to-end solution, which is also to ensure payroll and statutory reporting, is another interesting challenge. 

Navigate with a steady compass
Understanding the regulatory framework may require some additional guidance as a foreign employer in Switzerland. Careful planning will help maximise your chance of success, by creating a smooth onboarding process as a foreign employer. As trusted advisor, RSM can help you to plan to help you avoid the potential pitfalls, especially when it comes to the detail. We can assist with the handling of immigration, social insurances and payroll for foreign employers in Switzerland.

Find out how RSM Switzerland can assist you.

 

Authors

Embisa M'Peti
Partner Payroll & Employment Services

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