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Corona virus information
In quitt’s Coronavirus FAQ, you will find answers to key questions related to Coronavirus and home employees.
1. What do cleaners cost in Switzerland?
Cleaners are expensive in Switzerland. Prices typically range from around CHF 20 to CHF 30 an hour depending on the location and level of experience. Prices are high, partly because of the high value of the Swiss franc.
There is no guaranteed minimum wage in Switzerland, however if you employ a cleaner for five hours or more per week, special federal government rules require you the pay minimum rates. The rules and rates can be found here in French and German.
The federal government has set a minimum wage of CHF 18.90 per hour for those with no experience or training, rising to CHF 22.85 for those with experience and qualifications.
Geneva has its own rules which set the minimum at CHF 19.50, rising to CHF 25.07 for qualified experienced staff.
2. What visas and work permits are needed?
If you are employing someone without a permit who is not a Swiss citizen, you will need to apply for a work permit for them. If they are from one of a shortlist of EU countries then the process is simple. If they are from another country it becomes complicated and sometimes impossible. Your local commune office should be able to provide information on the process, which starts with an employment contract, passport information and a fair amount of paper work.
3. What social security, pension payments and taxes must be paid?
Employers are required to register employees and make certain salary deductions and payments. The main ones are social security payments and withholding taxes.
Social security breaks down into two amounts: the employee portion, and an additional employer payment. The total of the two comes to around 15% of salary, however it varies by canton. For example in Geneva it is 15.992% and in Zurich it is 12.270%. Detailed information on social security payments can be found here in English.
Generally, withholding taxes must be deducted from the salaries of those who aren’t Swiss citizens or holders of a C-permit, and paid to the cantonal tax office. The tax office in your canton will be able to provide assistance with this.
The government also offers a simplified procedure. Under this scheme, instead of deducting and paying separate social security and withholding tax as described above, you deduct and pay 5% of the gross salary to a cantonal social security fund. Employees do not have to file an additional tax declaration for this income and you do not have to issue an annual wage statement. This is sent directly to the employee by the social security fund.
If you pay your nanny no more than CHF 21,330 a year (CHF 1,777.50 monthly) then you would qualify for this scheme – if you have more than one domestic employee, the total annual salary amount must be no more than CHF 56,880. The scheme is open Swiss and foreign employees. However, family members and cross-border workers living in Liechtenstein and France do not qualify.
4. What pension payments are required?
Switzerland has a pension system with three elements, known as three pillars. The first, funded from social security payments, is paid by the state. The second is funded by salary deductions invested in the name of the employee. The third pillar is an optional payment that can be made every year by all employees. All of these payments are tax deductible.
Employers are not responsible for the third pillar, but must make social security payments for the first pillar (point 3 above) and second pillar payments if monthly pay exceeds CHF 21,330 a year, equivalent to around 16 hours a week on an hourly wage of CHF 25. There are many different plans and legal minimums. Payments include employer and employee payments, which are deducted from salary payments.
quitt.ch can also set up and administer second pillar pensions.
5. Is an employment contract necessary?
Written employment contracts are not required by law in Switzerland. There are however many reasons for having one. The first is the requirement to present one to Swiss authorities if you need to get a work visa for a non-Swiss citizen. The second is to provide a record of what you agreed should there be a misunderstanding or dispute.
The absence of a contract does not mean the parties can do whatever they want. When there is no contract the Swiss civil code applies. Contracts cannot override mandatory provisions in the Swiss civil code – article 319 of the Swiss civil code in French and German covers employment.
The main things to include in a written contract are: names, tasks, working hours, term, place of work, how the contract can be terminated – notice period etc, salary, salary deductions, sick pay, holidays, insurance, and signatures.
6. What happens if my cleaner is unable to work due to long-term illness?
Once your cleaner has worked for you for three months you are legally required to continue paying them if they fall ill and are unable to work. How much you must pay depends on how long they have worked for you. Swiss law, in French and German, sets out how much must be paid. The amount varies by canton. For example, in Zurich it starts at 3 weeks pay for cleaners employed for less than one year, rising to 17 weeks of pay for those who have worked for you for 11 years.
If you are concerned about the cost and would prefer to avoid the risk, you can take out employers’ sickness insurance. This typically costs less than 1% of salary. Its main advantage is that it extends payments beyond the legal minimum. For example if you have employed a cleaner for less one year you would legally only need to pay them three weeks of pay, if you live in Zurich. After a short stand down period, of say two weeks, sickness insurance would typically pay 80% of their salary for two years. This gives both you and your cleaner peace of mind should something requiring extended time off work occur.
quitt.ch can arrange sick pay insurance.
7. What other risks and what additional insurance should be taken out?
Employee insurance to cover accidents involving personal injury is compulsory. In French this is known as LAA, and in German as UVG. Premiums are a small percentage of salary and it is offered by most Swiss insurance companies.
Another risk for employers includes employee-employer disputes. For example, if your cleaner decides to stop coming to work or makes unrealistic salary demands and then decides to take the issue to court you need to defend yourself. Insurance covering the cost of legal defense can be taken out to reduce the risk of a nasty financial surprise.
In addition, it is worth checking whether your household insurance covers property damage by domestic employees. If it doesn’t, policies covering this risk exist.
As you have probably gathered by now, employing someone in Switzerland is complicated. This means you need to make sure you take on the right person to avoid needing to repeat the process.
Please let us know if you have any questions and we will try to answer them. Good luck!
And if you are interested in a service that takes care of all the admin for you and ensures your cleaner is legally employed click here to find out more about quitt.ch.
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