Employer of Record (EOR) in Switzerland
Employer of Record (EOR) in Switzerland allows businesses to hire employees without setting up a local entity. Switzerland has a workforce of around 5.2 million, known for high skill levels in finance, pharmaceuticals, engineering, IT, and precision manufacturing. The country is highly attractive for international hiring due to its business-friendly environment, strong infrastructure, and multilingual workforce. However, Swiss labor laws are decentralized, with differences across cantons, and employer contributions are among the highest in Europe. EOR services in Switzerland help companies manage payroll, contracts, benefits, and compliance while accessing talent quickly and efficiently.
About Switzerland
Switzerland, located in Central Europe, is one of the most competitive and innovative economies globally. Although not a member of the European Union, Switzerland maintains close economic ties with the EU through bilateral agreements and its membership in the European Free Trade Association (EFTA). The country is renowned for its political stability, high standard of living, and global financial hub cities such as Zurich, Geneva, and Basel.
The Swiss economy is diverse, with leading industries including banking and finance, life sciences, pharmaceuticals, biotechnology, IT, and precision engineering. The workforce is highly educated and multilingual, with German, French, Italian, and English commonly used in business.
Labor relations in Switzerland are governed by a combination of federal law, cantonal regulations, and collective agreements. This creates complexity for foreign companies, particularly regarding contracts, contributions, and termination procedures. For this reason, many organizations choose EOR services to ensure compliance and reduce administrative challenges while expanding into Switzerland.
Employment Terms and Regulations
Types of Contracts:
Permanent, fixed-term, probationary, part-time, and apprenticeship contracts.
Job Titles:
Common in finance, IT, pharmaceuticals, and engineering.
Working Hours:
Standard 40–42 hours per week, maximum 45–50 hours depending on sector.
Minimum Wage:
No federal minimum wage, but some cantons (e.g., Geneva, Neuchâtel) have set minimum wages (~CHF 20–23/hour).
Probation Period:
Typically 1–3 months.
Taxation and Contributions
Employers contribute to old-age pensions, unemployment insurance, accident insurance, and occupational pension funds. Contributions vary but are significantly higher compared to many other countries.
Types of Leave
Annual Leave:
Minimum 4 weeks per year (5 weeks for employees under 20).
Sick Leave:
Paid by employer for a period (varies by length of service), after which insurance covers costs.
Maternity Leave:
14 weeks at 80% of salary.
Paternity Leave:
2 weeks at 80% of salary.
Public Holidays:
Vary by canton (8–15 days).
Employee Benefits
Mandatory health insurance (private but regulated), occupational pension contributions, accident insurance, and unemployment insurance. Many employers also provide meal vouchers, transport allowances, and additional insurance.
Termination Process
Termination requires notice periods ranging from 1 to 3 months, depending on tenure. Termination must not be discriminatory or abusive. Severance pay is rare, except for long-serving employees over a certain age.
Employer Taxes
Employer contributions in Switzerland generally range from 12% to 15% of gross salary, covering pensions, unemployment, insurance, and other benefits.
EMPLOYER TAXES
12% to 15% (Estimated)
FAQ's
How STM Manages Employment in India
Establishing an entity in every hiring location can be cost-prohibitive. STM simplifies the process by employing and paying your Indian talent on your behalf. We handle the intricate HR procedures and employment contracts in compliance with local laws. You can conveniently approve invoices through our platform. By partnering with an Employer of Record (EOR), you can efficiently and compliantly hire top talent globally.
Payment Processes for Indian Employees
We streamline payroll management for your Indian workforce. Employee hours, leaves, holidays, bonuses, and commissions are meticulously calculated. STM invoices you around the 15th of each month in your preferred currency, including US Dollars (USD), Euros (EUR), British Pounds (GBP), Canadian Dollars (CAD), or Singapore Dollars (SGD). This ensures your Indian employees receive their salaries promptly in Indian Rupees (INR). Simplify further by consolidating your global team’s salaries into a single payment.
Full-time Employees vs. Global Contractors
Contractors engage with multiple companies and are self-employed, while full-time employees focus solely on their employer and receive additional benefits like health insurance, equity, and time off. While hiring international contractors can be cost-effective, it comes with misclassification risks. Partnering with an EOR for contractor onboarding and payments ensures compliant and timely compensation.
Reliable Employee Support
Our platform offers accessible support for employees and employers with inquiries about benefits, visas, and global employment in India. Utilize the chat function to connect with our expert team. Additionally, every STM client is assigned a dedicated account manager, serving as the primary contact for global HR assistance.
