Employer of Record in Switzerland

Hiring employees in Switzerland requires compliance with federal employment legislation, cantonal regulations, mandatory social insurance and occupational pension requirements. International companies must also consider Switzerland's strict rules governing employee leasing and the employment of foreign nationals. Switzerland offers access to a highly skilled workforce across pharmaceuticals, biotechnology, financial services, engineering, technology and international business. However, employment requirements differ from those in neighbouring EU countries. Switzerland is not an EU member state, and its employment, immigration and social security systems operate under distinct legal frameworks. Acumen International provides Global Employer of Record (EOR) services in Switzerland, supporting international companies with legally appropriate employment arrangements, payroll administration, statutory contributions, employee benefits and immigration requirements. Through our Global Employer of Record services, companies can employ eligible professionals in Switzerland without necessarily establishing their own Swiss subsidiary, subject to the applicable employment and staff leasing regulations.

How Employer of Record services work in Switzerland

An Employer of Record acts as the legal employer of personnel working for an international client. The EOR administers the employment contract, salary payments, statutory contributions and other employer obligations, while the client company manages the employee's operational responsibilities. In Switzerland, however, this arrangement requires particular attention to the legal distinction between employment services and regulated staff leasing. Where an employee is formally employed by one company but works under another company's direction and supervision, the arrangement may constitute staff leasing under Swiss law. Commercial staff leasing generally requires the appropriate authorisation. Consequently, a Swiss EOR arrangement must be assessed against the actual working relationship, the location of the employing entity and the relevant licensing requirements. An international company should not assume that an EOR arrangement permitted elsewhere in Europe can be implemented in Switzerland under identical conditions.

Staff leasing regulations and EOR licensing in Switzerland

Switzerland regulates private employment agencies and staff leasing under the Federal Act on Employment Services and the Hiring of Services (AVG/LSE). The legislation distinguishes between recruitment services, the commercial leasing of personnel and other employment arrangements.

When staff leasing requires a licence

Commercial staff leasing generally requires authorisation from the relevant cantonal labour authority. Additional federal authorisation from the State Secretariat for Economic Affairs (SECO) may be required for qualifying cross-border activities. The licensing requirements can include conditions relating to the business, responsible managers, financial security and compliance with employment legislation. Employers engaged in regulated staff leasing must also observe applicable employment conditions, including requirements arising from generally binding collective labour agreements.

Restrictions on foreign staff leasing

Swiss law prohibits staff leasing into Switzerland by companies based abroad. This restriction applies even where the foreign company is part of an international group, subject to the limited exceptions and distinctions recognised under the applicable legal framework. An EOR provider operating outside Switzerland therefore cannot assume that it may employ an individual abroad and lease that employee into Switzerland.

What this means for international employers

Before establishing an EOR arrangement, companies should confirm:

Whether the proposed relationship constitutes regulated staff leasing.
Whether the legal employing entity is established in Switzerland.
Whether the necessary cantonal or federal authorisations apply.
Whether a collective labour agreement governs the employment.
Whether the proposed arrangement satisfies immigration requirements.
Which organisation is responsible for workplace supervision and statutory obligations.

Acumen International assesses the proposed employment arrangement and applicable requirements before determining the appropriate route for employing personnel in Switzerland. Our article on Employer of Record licensing and regulated hiring explains why licensing requirements are an essential consideration when selecting an international employment provider.

Employment contracts in Switzerland

Swiss employment relationships are principally governed by the Swiss Code of Obligations, the Employment Act and applicable collective or standard employment contracts. Employment agreements may generally be concluded orally or in writing, although certain arrangements and contractual provisions require written form. Where an employment relationship is indefinite or lasts longer than one month, the employer must provide specified written information within one month of commencement. This includes the names of the parties, commencement date, employee's function, salary and any agreed weekly working hours. A comprehensive written contract should also address:

Job title and responsibilities.
Employment commencement date and duration.
Gross salary and payment frequency.
Working hours and workplace.
Probationary period.
Annual leave and public holidays.
Social insurance and pension arrangements.
Confidentiality and intellectual property.
Notice periods and termination conditions.

Employment terms must comply with applicable mandatory legislation and any relevant collective labour agreement.

Probationary periods

For an indefinite employment contract, the first month is generally treated as the probationary period unless otherwise agreed. The parties may agree in writing to a probationary period of up to three months, subject to applicable rules. During probation, the statutory notice period is generally seven calendar days unless a permitted alternative applies.

Working hours and overtime in Switzerland

Swiss working-time requirements depend on the employee's occupation, industry and applicable employment legislation. The Employment Act establishes maximum weekly working hours of:

Employee category	Maximum weekly hours
Industrial workers, office personnel, technical employees and certain other categories	45 hours
Most other employees covered by the Act	50 hours

Contractual working hours may be lower than the statutory maximum. Employers must distinguish between contractual overtime and work exceeding statutory maximum hours, as different rules can apply.

Overtime compensation

Under the Swiss Code of Obligations, qualifying contractual overtime may require compensation through additional pay or time off. The statutory default is a 25% wage supplement unless a legally permitted contractual arrangement provides otherwise. Overtime exceeding the statutory maximum working hours is subject to additional restrictions and compensation requirements.

Working-time records

Swiss employers generally must record employees' working hours, rest periods and relevant breaks. Simplified recording or exemptions may apply where the statutory conditions are satisfied. Employers must retain required working-time records for five years. These obligations remain relevant to remote and hybrid employees working from Switzerland.

Minimum wage in Switzerland

Switzerland does not have a nationwide statutory minimum wage. However, certain cantons and municipalities have introduced their own minimum wage requirements. Minimum remuneration can also arise from generally binding collective labour agreements or standard employment contracts. Consequently, the minimum permissible salary may depend on the employee's work location, industry and occupation. For international employers, this means that a salary appropriate in one canton may not satisfy the applicable requirements in another. Employers should establish the relevant cantonal and sectoral rules before agreeing remuneration.

Annual leave and public holidays

Swiss employees are entitled to statutory paid annual leave under the Code of Obligations.

Employee category	Minimum annual leave
Employees up to their 20th birthday	Five weeks
Other employees	Four weeks

Employment contracts and collective labour agreements may provide more generous entitlements. At least two weeks of annual leave must generally be taken consecutively.

Public holidays

Swiss public holidays vary by canton. Swiss National Day, celebrated on 1 August, is the federal public holiday. Cantons may recognise additional public holidays. Employers must therefore account for the employee's canton when administering public holiday entitlements and working-time arrangements.

Sick leave and salary continuation

Swiss employers have obligations concerning salary continuation when an employee is unable to work because of illness or other qualifying circumstances. Under Article 324a of the Code of Obligations, an employer generally must continue paying salary for a limited period where the statutory conditions are satisfied. The duration depends on the employee's length of service and applicable legal arrangements. Many Swiss employers maintain daily sickness allowance insurance, which can provide benefits under the relevant policy conditions. The interaction between statutory salary continuation and insurance arrangements must be reflected in employment contracts and payroll administration. Switzerland provides statutory family-related leave and income compensation arrangements. The principal entitlements include:

Maternity leave: Generally 14 weeks of paid leave following childbirth, with statutory income compensation subject to the applicable conditions and ceilings.
Leave for the other parent: Generally two weeks for eligible employees, subject to statutory requirements.
Adoption leave: Two weeks for qualifying adoptive parents under the applicable conditions.
Care leave: Statutory leave arrangements for qualifying family care responsibilities, including care of seriously ill or injured children.

Employers must coordinate leave entitlements, income compensation claims and payroll administration. Contractual or collective arrangements may provide additional benefits. Swiss payroll administration includes mandatory social insurance contributions, occupational pensions, accident insurance and applicable income tax withholding. The principal social insurance programmes include:

AHV/OASI – old-age and survivors' insurance.
IV/DI – disability insurance.
EO/IC – income compensation.
ALV/AC – unemployment insurance.
BVG/LPP – occupational pension provision.
UVG/LAA – mandatory accident insurance.

Contribution	Employee	Employer
AHV, IV and EO combined	5.30%	5.30%
Unemployment insurance, up to CHF 148,200 annual earnings	1.10%	1.10%
Combined standard contribution	6.40%	6.40%

The AHV, IV and EO contributions are generally calculated without the unemployment insurance earnings ceiling. Other employer costs, including family allowance contributions, occupational pensions, accident insurance and administrative charges, must be calculated separately. The actual employment cost therefore exceeds the standard 6.40% employer contribution shown above.

Occupational pension requirements in Switzerland

Switzerland operates a three-pillar pension system. The first pillar provides state old-age, survivors' and disability insurance. The second pillar provides occupational pension coverage through employer-affiliated pension arrangements. The third pillar comprises voluntary private retirement savings.

Mandatory occupational pension thresholds in 2026

Pension parameter	2026
Annual salary entry threshold	CHF 22,680
Coordination deduction	CHF 26,460
Upper annual salary limit for mandatory coverage	CHF 90,720
Minimum coordinated insured salary	CHF 3,780

Eligible employees must be enrolled in an occupational pension arrangement. The employer must finance at least half of the aggregate pension contributions required under the applicable pension plan. Actual contribution rates depend on the employee's age, the pension fund and the benefit arrangements. Occupational pension costs should therefore be included when calculating total employment expenditure in Switzerland.

Mandatory accident insurance

Swiss employers must provide statutory accident insurance for their employees. Occupational accident insurance is generally financed by the employer. Employees working at least eight hours per week for the same employer must also be insured against non-occupational accidents. Non-occupational accident insurance premiums are generally borne by employees unless the employer agrees to cover them. Premium rates depend on the insurer, industry and occupational risk. Employers must ensure that the correct coverage is established from the commencement of employment.

Income tax and withholding tax in Switzerland

Switzerland levies income tax at federal, cantonal and communal levels. The employee's total tax liability depends on factors including residence, income, family circumstances and the relevant canton and municipality. Unlike countries operating a uniform nationwide payroll withholding system, Switzerland applies different taxation arrangements to different categories of employees.

Taxation at source

Certain foreign employees who do not hold a Swiss C settlement permit are generally subject to withholding tax at source. The employer deducts the applicable tax from salary and remits it to the competent authorities. The rates and procedures depend on the employee's circumstances and relevant canton. Other employees may pay income tax through the ordinary assessment system. Employers must establish the correct tax treatment rather than assuming that all Swiss employees are subject to identical payroll withholding arrangements.

Cross-border employees

Employees residing outside Switzerland but working in the country may be subject to specific cross-border taxation and social security rules. These arrangements can be affected by bilateral agreements, the employee's country of residence and the proportion of work performed remotely. Our article on permanent establishment and international remote work examines the wider corporate tax considerations associated with cross-border employment.

Employment costs in Switzerland

The gross salary agreed with an employee represents only part of the total employer expenditure. Additional costs can include:

Employer AHV, IV and EO contributions.
Employer unemployment insurance contributions.
Occupational pension contributions.
Occupational accident insurance.
Family allowance fund contributions.
Applicable sickness insurance arrangements.
Contractual employee benefits.
Employment administration and EOR service fees.

Consider an employee earning CHF 120,000 annually.

Cost component	Annual amount
Gross annual salary	CHF 120,000
Employer AHV, IV and EO at 5.30%	CHF 6,360
Employer unemployment insurance at 1.10%	CHF 1,320
Subtotal	CHF 127,680

This calculation excludes occupational pensions, accident insurance, family allowances, other employer charges, benefits and EOR fees. It is therefore not a complete employment cost estimate. The total cost will depend on the employee's canton, pension plan, age, insurance arrangements and remuneration package. Companies can use Acumen's Global Payroll Calculator to model international employment costs and compare different hiring markets. Our article on employment cost estimation and payroll budgeting explains the importance of accounting for employer contributions beyond gross salary.

Work permits and immigration in Switzerland

Switzerland distinguishes between EU/EFTA nationals and third-country nationals when determining access to employment.

EU/EFTA nationals

Eligible EU/EFTA nationals benefit from the applicable free movement arrangements. Depending on the duration and circumstances of employment, they may need to complete a notification procedure or obtain the relevant residence permit. Employers must comply with the applicable registration and employment requirements.

Non-EU/EFTA nationals

Employment of third-country nationals is subject to more restrictive requirements. Swiss authorities generally prioritise highly qualified professionals and apply conditions relating to qualifications, remuneration, labour market availability and employer eligibility. Work permit quotas apply to certain categories of third-country nationals. The application process can involve cantonal authorities and federal approval. A Swiss employment contract or EOR arrangement does not automatically establish work permit eligibility.

Immigration and regulated staff leasing

The proposed employment arrangement must satisfy both immigration legislation and the rules governing staff leasing. For certain immigration categories, the identity of the employer and the relationship between the employee and the organisation receiving the work are particularly important. Acumen's global mobility and immigration services support the assessment and coordination of eligible international employment arrangements. Our article on immigration and global mobility planning discusses how employment arrangements and work authorisation affect international hiring.

Termination and notice periods in Switzerland

Swiss employment contracts may generally be terminated subject to the applicable notice requirements and statutory protections. The standard notice periods for indefinite employment contracts under the Code of Obligations are:

Employment period	Statutory notice
During probation	Seven calendar days
First year of service	One month
Second to ninth year of service	Two months
From the tenth year of service	Three months

After probation, statutory notice generally takes effect at the end of a calendar month. Different notice arrangements may apply under a valid written agreement or collective employment contract, subject to statutory restrictions.

Protection against dismissal

Swiss law provides protection against abusive dismissal and restricts termination during certain protected periods, including qualifying illness, accident, pregnancy and other circumstances. A dismissal may also create obligations relating to outstanding salary, accrued holiday entitlement, bonuses and other contractual payments. Employers must review the applicable employment agreement and statutory requirements before implementing a termination. Our article on notice periods and employer obligations examines the financial and legal considerations associated with ending employment.

Hiring independent contractors in Switzerland

Independent contracting is possible in Switzerland, but the relationship must reflect genuine self-employment. The relevant authorities examine the actual circumstances, including the individual's commercial independence, financial risk, business organisation and relationship with the client. A contract describing a professional as self-employed does not establish that status automatically. Where an individual is effectively working as an employee, the arrangement may create social insurance, employment and tax liabilities. International companies should also consider whether their activities create a taxable business presence in Switzerland. Our article on worker misclassification in global hiring explains the risks associated with incorrectly classifying professionals.

When an Employer of Record is appropriate in Switzerland

An EOR arrangement may be relevant to international companies seeking to employ professionals in Switzerland without immediately establishing their own subsidiary. Typical business requirements include:

Hiring an eligible specialist for a defined market or operational requirement.
Establishing a small local team before deciding whether to incorporate.
Employing professionals during an international corporate reorganisation.
Maintaining employment continuity during a qualifying workforce transition.
Supporting eligible foreign professionals with employment and immigration administration.

However, the legal availability of an EOR arrangement depends on its actual structure. In particular, companies must establish whether the proposed relationship involves regulated staff leasing and whether the necessary authorisations are in place. For some roles or arrangements, direct employment through a Swiss entity or another employment model may be more appropriate. Our article on local entity versus Global EOR discusses how companies can evaluate the available models.

How Acumen International supports employment in Switzerland

Acumen International supports international companies employing eligible professionals in Switzerland through legally appropriate Global Employer of Record arrangements. Our services cover:

Employment arrangements and contracts: Assessing the proposed employment model and coordinating contracts under applicable Swiss requirements.
Payroll and social insurance: Administering salary payments, AHV, IV, EO, ALV and relevant statutory reporting.
Occupational pensions and insurance: Coordinating mandatory pension arrangements, accident insurance and agreed employee benefits.
Working time and leave: Administering statutory holiday entitlements, applicable absence provisions and employment changes.
Immigration support: Coordinating eligible work authorisation and immigration requirements for foreign professionals.
Employee administration: Supporting onboarding, payroll changes, contractual amendments and employment termination.
International account management: Providing coordinated commercial administration for companies employing personnel across multiple jurisdictions.

The employment arrangement must be assessed against Swiss staff leasing and licensing requirements before implementation. Our Employer of Record onboarding guide explains the broader considerations involved in establishing international employment arrangements.

Frequently asked questions about Employer of Record services in Switzerland

Can a foreign company hire employees in Switzerland without establishing a subsidiary?

Yes, depending on the circumstances and employment model. Options may include direct employment by a foreign employer or an appropriately authorised local employment arrangement. The relevant payroll, tax, social insurance and staff leasing requirements must be assessed.

Is Employer of Record legal in Switzerland?

EOR arrangements are not automatically prohibited, but arrangements involving regulated staff leasing must comply with Swiss licensing and employment legislation. The legal position depends on the actual relationship and employing entity.

Does an EOR need a licence in Switzerland?

Where the proposed arrangement constitutes commercial staff leasing, the relevant cantonal authorisation is generally required. Additional federal authorisation may apply to certain cross-border activities.

Can a foreign EOR lease employees into Switzerland?

Swiss law generally prohibits staff leasing into Switzerland by companies based abroad. The standard employer contributions for AHV, IV and EO total 5.30%. Employer unemployment insurance adds 1.10% on qualifying annual earnings up to CHF 148,200. Occupational pensions, insurance and other contributions are additional.

Is there a national minimum wage in Switzerland?

No. Certain cantons and municipalities have minimum wage requirements, and collective labour agreements may establish additional remuneration standards.

How much annual leave do employees receive in Switzerland?

Employees generally receive at least four weeks of paid annual leave. Employees up to their 20th birthday are entitled to at least five weeks.

Are occupational pensions mandatory?

Yes, for employees meeting the applicable eligibility conditions. The annual salary entry threshold is CHF 22,680 in 2026. An EOR arrangement does not automatically qualify for work permit sponsorship. The employer, role, nationality, immigration category and applicable staff leasing rules must be assessed.

Does using an EOR eliminate permanent establishment risk?

No. Permanent establishment exposure depends on the international company's activities and applicable tax law. An EOR arrangement does not automatically eliminate corporate tax obligations.

Employ your workforce in Switzerland with Acumen International

Acumen International helps international companies employ eligible professionals in Switzerland and administer the associated employment, payroll, social insurance and statutory obligations. Our services cover employment arrangements, Swiss payroll, AHV and other social insurance contributions, occupational pensions, accident insurance, employee benefits, eligible immigration support and ongoing employment administration. Whether you are hiring your first employee in Switzerland, establishing a specialist team or managing employees across several countries, Acumen helps determine an appropriate employment arrangement supported by international account management. Contact Acumen International to discuss your requirements.