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Employment & Labour Law 2019

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The International Comparative Legal Guide to: Employment & Labour Law 2019

Country Question and Answer Chapters:

1 Albania Deloitte Legal Sh.p.k.: Sabina Lalaj & Ened Topi 1

2 Australia People + Culture Strategies: Joydeep Hor & Therese MacDermott 11

3 Austria GERLACH Rechtsanwälte: Roland Gerlach & Markus Loescher 18

4 Bahamas Meridian Law Chambers: Dywan A. G. R. Rodgers 24

5 Bahrain Hassan Radhi & Associates: Ahmed Abbas & Sayed Jaffer Mohammed 30

6 Belgium Lydian: Jan Hofkens & Alexander Vandenbergen 37

7 Bermuda MJM Limited: Fozeia Rana-Fahy 44

8 Brazil A. Lopes Muniz Advogados Associados: Antônio Lopes Muniz &

Zilma Aparecida S. Ribeiro 51

9 Canada Filion Wakely Thorup Angeletti LLP: Carol S. Nielsen & Cassandra Ma 58

10 Chile Porzio Ríos García: Ignacio García & Fernando Villalobos 65

11 China AnJie Law Firm: Zhenghe Liu & Samuel Yang 71

12 Cyprus Koushos Korfiotis Papacharalambous LLC: Loucas Koushos &

Marilia Ioannou 79

13 Denmark Lund Elmer Sandager Law Firm LLP: Michael Møller Nielsen &

Julie Flindt Rasmussen 88

14 Finland Waselius & Wist: Jouni Kautto 97

15 France Latournerie Wolfrom Avocats: Sarah-Jane Mirou 103

16 Germany Hogan Lovells: Dr. Kerstin Neighbour & Dr. Tim Gero Joppich 112

17 Hong Kong Lewis Silkin: Kathryn Weaver & Catherine Leung 119

18 Hungary Rátkai Law Firm: Ildikó Rátkai 127

19 India Lakshmikumaran & Sridharan: Neeraj Dubey & Rohit Subramanian 134

20 Indonesia SANDIVA Legal Network: Arthur Sanger & Allova Herling Mengko 143

21 Ireland McCann FitzGerald: Mary Brassil & Stephen Holst 149

22 Isle of Man DQ Advocates Limited: Leanne McKeown & Jessica McManus 157

23 Israel Amit, Pollak, Matalon & Co.: Rachel Harari-Lifshits & Naama Babish 165

24 Italy Carnelutti Law Firm: Giuseppe Bulgarini d’Elci & Marco Sartori 173

25 Japan Mori Hamada & Matsumoto: Shiho Ono & Yuko Kanamaru 182

26 Korea SEUM Law: Steve Ahn & Byungil Lee 192

27 Kosovo Deloitte Kosova Sh.p.k.: Ardian Rexha & Vjosa Misini 199

28 Luxembourg Etude Jackye Elombo: Jackye Elombo 205

29 Macedonia Debarliev, Dameski & Kelesoska, Attorneys at Law:

Emilija Kelesoska Sholjakovska & Ljupco Cvetkovski 212

30 Malaysia Seow & Associates: Jessie Tan Shin Ee & Joel Prashant 220

31 Malta GANADO Advocates: Dr. Matthew Brincat & Dr. Lara Pace 228

32 Mexico Hogan Lovells: Hugo Hernández-Ojeda Alvírez & Luis Ruiz Gutiérrez 236

33 Mozambique BAS - Sociedade de Advogados, SP, RL: Pedro Madeira de Brito &

Lara Tarciana Sousa dos Mucudos Macamo 243

34 Netherlands ACG International: Edith N. Nordmann & Fadi S. Fahad 250

35 Nigeria Udo Udoma & Belo-Osagie: Jumoke Lambo & Mary Ekemezie 258

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Continued Overleaf

The International Comparative Legal Guide to: Employment & Labour Law 2019

Country Question and Answer Chapters: 36 Oman Al Hashmi Law: Omar Al Hashmi & Syed Faizy 265

37 Poland CDZ Legal Advisors: Piotr Kryczek 271

38 Portugal BAS - Sociedade de Advogados, SP, RL: Dália Cardadeiro &

Alexandra Almeida Mota 279

39 Romania ONV LAW: Mihai Voicu & Alina Arseni 287

40 Russia Egorov Puginsky Afanasiev & Partners: Anna Ivanova & Olga Tyangaeva 295

41 Slovenia Law firm Šafar & Partners, Ltd: Martin Šafar 302

42 South Africa Cheadle Thompson & Haysom Inc. Attorneys: Shamima Gaibie &

Paul Benjamin 311

43 Spain Monereo Meyer Abogados: Monika Bertram & Patricia Rivera Almagro 319

44 Sweden EmpLaw Advokater AB: Annika Elmér 326

45 Switzerland Homburger: Dr. Balz Gross & Dr. Gregor Bühler 332

46 Taiwan Winkler Partners: Christine Chen 340

47 Thailand R&T Asia (Thailand) Limited: Supawat Srirungruang &

Saroj Jongsaritwang 345

48 Turkey Esenyel|Partners Lawyers & Consultants: Selcuk S. Esenyel 353

49 United Arab Emirates Hamdan AlShamsi Lawyers and Legal Consultants: Hamdan Al Shamsi 359

50 United Kingdom Hogan Lovells: Stefan Martin & Jo Broadbent 365

51 USA Hughes Hubbard & Reed LLP: Ned Bassen & Nathan Cole 372

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Chapter 45

Homburger

Dr. balz gross

Dr. gregor bühler

Switzerland

1 Terms and Conditions of Employment

1.1 What are the main sources of employment law?

The main sources of employment law in Switzerland are the Code of

Obligations, the Labour Act and the terms agreed in the contract of

employment. In some industries, mandatory collective bargaining

agreements will apply.

Additional legislation includes specific rights or obligations, e.g.,

the Participation Act, the Gender Equality Act, the Data Protection

Act, the Merger Act or the Ordinance against Excessive

Compensation.

1.2 What types of worker are protected by employment law? How are different types of worker distinguished?

Swiss employment law does not distinguish between different types

of workers, i.e., the same rules apply for all employees. There are

some additional provisions for specific types of employees, e.g., for

pregnant women. Further, statutory rules regarding overtime will

not apply to members of senior management.

Only self-employed persons are not subject to employment law. It

is not the wording of the contract, but whether or not an individual

is in fact, running their own business, that is relevant to determine if

they are considered self-employed. If a person works under the

instructions of an employer and/or with the employer’s means of

work, he or she will be considered an employee.

1.3 Do contracts of employment have to be in writing? If not, do employees have to be provided with specific information in writing?

Contracts of employment do not have to be in writing. However,

certain terms need to be in writing and duly executed by both parties to

be valid and binding, in particular if they deviate from the statutory

default rules (e.g., terms regarding notice periods, overtime,

probationary periods, post-contractual non-compete obligations).

Moreover, the employee must be provided with the following

particulars in writing: names of the employer and employee; starting

date of employment; function; compensation; and weekly hours of

work.

1.4 Are any terms implied into contracts of employment?

There are various implied terms which govern the employment

relationship. Most of them are outlined in the Code of Obligations.

Some terms are mandatory; others will only apply if the parties do

not agree otherwise.

Terms might be implied based on past practice. For example, if a

bonus has been paid for years, the employee might have a contractual

entitlement to such payments.

1.5 Are any minimum employment terms and conditions set down by law that employers have to observe?

There are statutory minimum employment terms and conditions,

e.g., at least four weeks’ holiday per year and a notice period of not

less than one month.

There is no statutory minimum salary. However, mandatory

collective bargaining agreements provide for a minimal pay in

certain industries.

1.6 To what extent are terms and conditions of employment agreed through collective bargaining? Does bargaining usually take place at company or industry level?

There are collective bargaining agreements in certain industries,

e.g., construction, hotels/restaurants, the pharmaceutical industry,

etc. Some collective agreements were declared mandatory for the

entire industry by the government.

Bargaining usually takes place at industry level.

2 Employee Representation and Industrial Relations

2.1 What are the rules relating to trade union recognition?

There is no statutory recognition process as in other jurisdictions. In

general, trade unions have to be separate legal entities with the main

aim to improve conditions of employment, and they have to be

independent from employers and other third parties and the

membership has to be voluntary.

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2.2 What rights do trade unions have?

There are no specific statutory rights that employers have to be

aware of.

Collective bargaining agreements might provide for some rights of

trade unions. In particular, to enforce the terms of collective

bargaining agreements (e.g., minimal pay), joint commissions

(consisting of trade unions’ members and employers’

representatives) might be established. Such commissions are

entitled to get access to certain documents like payroll data.

Further, there are joint commissions consisting of trade union

members, employers’ representatives and governmental authorities

which shall ensure that employment terms will not unduly worsen in

certain industries. These official joint commissions have the right to

review employment conditions and they might recommend the

government to declare existing collective bargaining agreements

compulsory for the whole industry or to issue minimal terms for

certain functions (such minimal terms currently apply for domestic

work only on a national level).

2.3 Are there any rules governing a trade union’s right to take industrial action?

There is a constitutional right to take industrial action, but there are

no statutory rules. Precedents suggest that a strike should be

considered as an action of last resort. Collective bargaining

agreements will usually restrict the right to strike. It is discussed

whether further conditions apply, in particular that strikes need to be

supported by a trade union and that the strike has to aim at a matter

that can be dealt with in a collective bargaining agreement.

2.4 Are employers required to set up works councils? If so, what are the main rights and responsibilities of such bodies? How are works council representatives chosen/appointed?

All businesses with more than 50 employees have to set up a works

council by request of the employees. A fifth of the workforce (or

100 employees) can ask for a vote; if the majority of the voting

employees support the request, elections have to take place. The

election will be organised by the employer and employees jointly.

Only a limited number of companies have set up a works council in

Switzerland.

2.5 In what circumstances will a works council have co-determination rights, so that an employer is unable to proceed until it has obtained works council agreement to proposals?

Works councils only have information rights and they have to be

consulted before certain decisions (regarding work safety, mass

dismissals, transfer of a business or pension plans) are made.

Further, see the answers to questions 6.9 and 6.10 with regards to the

social plan in case of a mass dismissal.

2.6 How do the rights of trade unions and works councils interact?

There is no established way of interaction. In any event, only a

limited number of companies have works councils.

2.7 Are employees entitled to representation at board level?

No, employees are not entitled to representation at board level.

3 Discrimination

3.1 Are employees protected against discrimination? If so, on what grounds is discrimination prohibited?

Protection against discrimination is based on the general duty of the

employer to protect the employee’s rights of personality. The

employer must not discriminate against an individual employee

without objective reasons. However, employees are only protected

against discrimination by employers, if such discrimination resulted

in a violation of their rights of personality. Within that limited

scope, the employees are protected against discrimination regardless

of the basis of the discrimination, i.e., age, disability, race, political

belief, religion or otherwise.

The Federal Disabled Equality Act only directly protects employees

of the federal government; hence, disabled persons are protected

within the framework of the general protection of their rights of

personality. There is, however, an increased protection in connection

with building laws.

There is a broader protection against discrimination because of

gender. The Federal Gender Equality Act provides for detailed

substantive and procedural rules that shall protect employees

against discrimination because of their gender.

Further, the international agreements between the European Union

(and its Member States) and Switzerland on the free movement of

persons, provide for equal treatment of employees who are nationals

of a contracting party. Such persons may not, by reason of their

nationality, be treated differently from employees who are nationals

of the other contracting party as regards conditions of employment

and working conditions, especially as regards pay or dismissal.

3.2 What types of discrimination are unlawful and in what circumstances?

The law protects against any sort of direct or indirect discrimination.

Discrimination is defined as treating an employee worse than others.

There is no protection against the (arbitrary) better treatment of other

employees. In addition, even arbitrary discrimination by the

employer may be tolerated unless the discrimination results in the

violation of the employee’s rights of personality, in particular because

the discrimination reflects a disregard of the employee’s personality.

The Gender Equality Act protects employees against any kind of

direct or indirect discrimination based on gender, including

discrimination because of civil status, family situation and pregnancy.

The protection exists for the entire employment relationship, from the

negotiations on a new employment to retirement (and retirement

benefits) and termination. It includes protection against unfavourable

working conditions, lower salary and sexual harassment.

3.3 Are there any defences to a discrimination claim?

There is no unlawful discrimination if employers are able to

establish that the unequal treatment does not result in the violation

of the employee’s right of personality, i.e., that there are valid

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reasons to treat one individual employee differently or rather that

some employees are treated better than others (and not that

individual employees are discriminated against), or that the different

treatment is so minor that it does not result in a violation of the

rights of personality.

The Gender Equality Act sets much more stringent standards, and

any discrimination that is based on gender, whether directly or

indirectly, is generally prohibited.

3.4 How do employees enforce their discrimination rights? Can employers settle claims before or after they are initiated?

A violation of the prohibition against discrimination is a violation of

statutory employment law and the employment contract. Employees

have to file a lawsuit with the courts that have jurisdiction for

employment matters; a mandatory conciliation proceeding is part of

the proceeding. Employees can freely dispose of the claims made in

discrimination proceedings, and claims are frequently settled before or

after proceedings are initiated.

3.5 What remedies are available to employees in successful discrimination claims?

The main remedy in discrimination proceedings is monetary

compensation. Employees also have a right to an order of the court

prohibiting continuation of discrimination, or preventing a

threatened discrimination.

In gender discrimination cases in connection with an alleged

discriminatory dismissal, the court can order the provisional re-

employment of an employee and eventually cancel the termination and

order definitive re-employment. This is not possible in all other

discrimination cases in connection with alleged discriminatory

dismissal, where the only available remedy is monetary compensation.

3.6 Do “atypical” workers (such as those working part-time, on a fixed-term contract or as a temporary agency worker) have any additional protection?

There is special legislation on employment placements designed to

protect temporary workers that are placed by professional agencies.

In addition, certain collective bargaining agreements have special

rules for part-time workers, or workers that are on call. Finally,

legislation protects posted workers.

4 Maternity and Family Leave Rights

4.1 How long does maternity leave last?

A female employee is generally entitled to 14 weeks of paid

statutory maternity leave following the child’s birth.

In addition to the provisions on maternity leave, there are other rules

on pregnancy and status following birth. These rules provide, in

particular, that an employer shall not terminate the employment

relationship during pregnancy and during a period of 16 weeks

following birth. In addition, an employee must not work during a

period of eight weeks following birth, and she is only required to

work during an additional period of eight weeks if she agrees to do

so. Similarly, the employee is only required to work during

pregnancy and during the nursing period if she agrees to do so.

Moreover, collective bargaining agreements and the individual

employment agreements often contain additional rules which

further improve the position of the employee during pregnancy and

following birth.

4.2 What rights, including rights to pay and benefits, does a woman have during maternity leave?

During the 14 weeks’ statutory maternity leave, and provided the

employee meets certain conditions, the contractually agreed

remuneration is replaced by a compensation of 80 per cent of the last

average remuneration. The compensation is presently (2018)

capped at CHF196 per day. The employee receives the

compensation directly from a social security fund or from the

employer (who can then recover the payments from the social

security fund). It is unclear whether employers have to top up

payments to a certain extent.

The rules on maternity leave do not cover the issue of whether an

employee continues receiving the contractually agreed salary if she

is not working during pregnancy and following birth (but for the

period of 14 weeks covered by the maternity leave rules). If the

employee cannot work for medical reasons, the right to

remuneration and its duration will depend on a number of factors,

including the duration of the employment and the contractual

agreement in the employment contract. In addition, employers are

regularly insured against the risk of employees not working during

pregnancy for medical reasons. To the extent insurance coverage

exists and meets statutory standards, the insurance’s payments

replace the employer’s obligation to pay remuneration.

4.3 What rights does a woman have upon her return to work from maternity leave?

Maternity leave does not change the terms of the employment

relationship. Hence, the employee will have the same rights and

obligations upon her return to work as before the maternity leave.

She will usually have to continue the same job as before birth, and

is not entitled to reduce her working time, unless otherwise agreed

with the employer.

4.4 Do fathers have the right to take paternity leave?

Employers must grant time-off to fathers with a new child, but this

is limited to a couple of days. There are no statutory rights to longer

paternity leave, but some collective bargaining agreements and

individual agreements provide for a right to take paternity leave.

4.5 Are there any other parental leave rights that employers have to observe?

Parents have a statutory right to stay away from work for three days

to take care of sick family members.

4.6 Are employees entitled to work flexibly if they have responsibility for caring for dependants?

No, employees who have responsibilities for caring for dependants

are not entitled to work flexibly.


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5 Business Sales

5.1 On a business sale (either a share sale or asset transfer) do employees automatically transfer to the buyer?

If a business unit is transferred in an asset deal, the contracts of

employment assigned to the business will automatically transfer

from the seller to the buyer. Employees can object to the transfer.

An objection results in a termination of the employment relationship

after the expiry of the statutory notice period.

A share sale does not affect the employment agreements, because

the identity of the employer will not be altered. Hence, employees

will still be employed by the same company under the same

contracts.

5.2 What employee rights transfer on a business sale? How does a business sale affect collective agreements?

Employees will work for a different employer after the transfer, but

under the same employment contract. Hence, all current terms of

the employment contracts will transfer with the employees.

The buyer has to comply with collective bargaining agreements for

a period of one year after the transfer, unless such agreements will

expire or will be terminated earlier. In some industries, mandatory

collective bargaining agreements apply.

A share sale does not trigger a transfer.

5.3 Are there any information and consultation rights on a business sale? How long does the process typically take and what are the sanctions for failing to inform and consult?

In the context of a business sale by means of an asset deal,

employees (or the works council, if there is one) have to be

informed about the reasons for the transfer and its legal, economic

and social implications for the employees. If measures that might

affect employees are considered (e.g., dismissals, change of terms

and conditions of employment agreements), a consultation is

required. In principle, the consultation period should not be less

than two weeks (longer periods might be required in certain

circumstances), and a few additional days will be needed to prepare

proper information and to consider any proposals made during the

consultation. The law does not provide for specific sanctions for

failing to inform and consult in the case of an asset deal. However,

if the Merger Act applies, employees have the right to block the

commercial register if the employer failed to duly inform/consult.

This can delay the closing of the transaction.

No specific information or consultation rights apply in case of a

share sale.

5.4 Can employees be dismissed in connection with a business sale?

Yes, but a business need might be required for the dismissal, and the

dismissal should not be a means to circumvent the automatic

transfer of the employment. Consultation has to be completed

before notice is given. Mass dismissals will trigger further

consultation rights and notification obligations.

5.5 Are employers free to change terms and conditions of employment in connection with a business sale?

Employees have to be consulted regarding changes of terms and

conditions in connection with a business sale (see question 5.2

above). There are no further specific restrictions. Hence, the same

rules apply as for an amendment of employment agreements that is

not in connection with a business sale: employers can unilaterally

offer a change in terms and conditions, but they have to take the

applicable notice periods into account, i.e., no employee has to

accept new terms before the contractual notice period has expired.

After the expiry of the notice period, the employee can either

continue to work under the new conditions, or quit the employment.

Amendments to the detriment of employees only (e.g., cuts of base

salaries, increase in working hours) might be deemed to be abusive

if the employer is unable to provide objective reasons for the

change. Employees who will not accept the new conditions and,

therefore, quit the employment after the notice period might be able

to claim an indemnity of up to six months’ salary (see question 6.3).

6 Termination of Employment

6.1 Do employees have to be given notice of termination of their employment? How is the notice period determined?

Employees have to be given notice of termination of their

employment. The length of the notice period is agreed in the

employment contract, subject to statutory rules on minimum length

and equality of the notice periods for notice to be given by the

employer and employee.

An employment relationship can be terminated with immediate

effect for cause.

6.2 Can employers require employees to serve a period of “garden leave” during their notice period when the employee remains employed but does not have to attend for work?

Yes, and it is general practice to put employees on garden leave

during their notice period in certain industries, such as the financial

service industry and for senior managers.

A ‘right to work’, which excludes the employer’s right to put an

employee on garden leave, only exists under very special

circumstances, in particular for jobs that require the employee to

continuously work in order to keep certain qualifications (pilots

who may lose their licence, artists, etc.).

6.3 What protection do employees have against dismissal? In what circumstances is an employee treated as being dismissed? Is consent from a third party required before an employer can dismiss?

An employee is treated as being dismissed if either party to the

employment contract has given notice of termination, and the

employment relationship ends at the end of the notice period. No

third-party consent is required for a dismissal.

Employees are protected against abusive dismissal. Such abuse

exists, for example, if: notice of termination is given because the


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employee raises a bona fide claim arising out of the employment

agreement; notice of termination is given because the employee

exercises a constitutional right; notice is only given to prevent the

coming into existence of a claim arising out of the contract; or notice

is given for a reason that is inherent to the personality of the other

party (gender, race, origin, nationality, age, etc.). An abusive

dismissal will be effective, but the employee is entitled to

compensation (see below, question 6.5).

In addition, the employer shall not give notice of termination during

protected periods. Such protection against dismissal exists while

the employee is on military or civil service or a foreign aid project,

or while the employee is totally or partially incapacitated because of

a sickness or accident (the latter protection period is limited from

30–180 days, depending on years of service). In addition,

protection against dismissal exists during pregnancy and for a

period of 16 weeks following birth. A notice of termination given

during such a protected period is null and void.

6.4 Are there any categories of employees who enjoy special protection against dismissal?

Whilst employees are all treated alike, certain rules will only protect

specific categories of employees (e.g., pregnant women, etc.).

Further, there is a (dischargeable) presumption that the dismissal of

a member of the works council is abusive.

6.5 When will an employer be entitled to dismiss for: 1) reasons related to the individual employee; or 2) business related reasons? Are employees entitled to compensation on dismissal and if so how is compensation calculated?

Swiss law is governed by the principle that both the employer and

the employee have the right to give notice of termination for any

reason. No special reason is required. The dismissal must not be

abusive, however (see above, question 6.3).

Employees are generally not entitled to compensation on dismissal.

A rule on mandatory severance payments for employees who are

more than 50 years of age and have worked more than 20 years for

the same employer has become practically defunct because

payments made by the employer to the pension plan can be regularly

deducted from the severance payment.

The employee is entitled to a compensation of up to six monthly

salaries if the dismissal was abusive.

6.6 Are there any specific procedures that an employer has to follow in relation to individual dismissals?

There are no specific procedures that an employer is obligated to

follow in relation to individual dismissals. Collective bargaining

agreements or individual agreements frequently state that the notice

must be in writing or must even be served by registered mail.

6.7 What claims can an employee bring if he or she is dismissed? What are the remedies for a successful claim?

All claims regularly arising out of the employment contract become

due upon termination of the employment relationship. It is disputed

whether the employer and employee can agree that certain claims

(in particular claims arising out of deferred bonus schemes) are only

due a certain period after termination.

Apart from claims arising because a dismissal is abusive (see above,

question 6.5) or for unjustified termination without notice, there are

no other claims that an employee can bring to challenge a dismissal.

6.8 Can employers settle claims before or after they are initiated?

In case of a true settlement: yes. However, unless in the context of

a genuine settlement, the employee may not waive mandatory

claims arising out of the employment relationship during the

employment and before one month after the end of the employment.

6.9 Does an employer have any additional obligations if it is dismissing a number of employees at the same time?

The employer must consult with the employees before a final

decision on the dismissals is made, if the dismissal is considered a

‘mass dismissal’ (i.e., dismissal within a period of 30 days of 10

employees [for businesses with 20–99 employees], or 10 per cent of

the employees [for businesses with 100–299 employees], or more

than 30 employees [for larger businesses]). In addition, the local

labour office must be informed of the dismissals.

Further, companies with more than 250 employees have to negotiate

a social plan with a union, a works council or the employees if they

intend to dismiss at least 30 employees.

6.10 How do employees enforce their rights in relation to mass dismissals and what are the consequences if an employer fails to comply with its obligations?

The mass dismissal will be considered abusive if the employer has

not properly consulted with the employees. The employees have a

claim for payment of a penalty of up to two monthly salaries. If the

employer fails to inform the local labour office, the dismissal will

not become effective. In case the parties cannot agree on a required

social plan (see above, question 6.9), an arbitral tribunal will

establish the plan.

7 Protecting Business Interests Following Termination

7.1 What types of restrictive covenants are recognised?

Non-compete covenants are recognised by the law. All types of

post-employment restrictions on the employee are regularly

considered non-compete covenants and their enforceability is tested

according to the rules established for non-compete covenants.

Based on current case law, however, covenants related to the non-

solicitation of employees are unlikely to be enforceable.

7.2 When are restrictive covenants enforceable and for what period?

Non-compete covenants must be agreed in writing. The covenant is

only enforceable if the employee had access to information on the

employer’s customers or to business secrets. In addition, the

covenant is only binding if the use of the information obtained by

the employee could seriously harm the employer. Further, any

covenant will become void if the employer gave notice without

valid reason for which the employee is responsible, or if the


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employee terminated the employment for a valid reason for which

the employer is responsible. Finally, the restriction must be

reasonably limited with regard to its duration, the place where it

should apply and the type of operation covered.

7.3 Do employees have to be provided with financial compensation in return for covenants?

Payment of financial compensation is not a requirement, but

increases the chances that a covenant can be enforced.

7.4 How are restrictive covenants enforced?

In case of a violation of the covenant, the employer can ask for

financial compensation for the loss suffered. The contractual

clauses often provide for a liquidated damages clause. In addition,

the employer can ask for a court order to prohibit the employee from

continuing the competing activity if the non-compete covenant

expressly mentions such a right of the employer. The courts weigh

the interests of the employer and the employee, and may order the

employee to stop the competing activity if the non-compete

covenant is found to be enforceable.

8 Data Protection and Employee Privacy

8.1 How do employee data protection rights affect the employment relationship? Can an employer transfer employee data freely to other countries?

The employer may handle data concerning the employee only to the

extent that such data concerns the employee’s suitability for his or

her job or is necessary for the performance of the employment

contract. Such data must have a close connection to the employment,

and any gathering of data must be strictly proportionate to its purpose.

Gathered data may only be used for its initial purpose and must be

protected against unauthorised handling by third persons. As a

matter of principle, the employee must be aware of any data

gathering and of its purpose, and consent to it. The same holds true

for any monitoring activities by the employer.

The transfer abroad of employee data must respect the principles

explained above. In addition, Swiss law takes into consideration

whether a transfer would seriously jeopardise the personality rights

of the concerned employee. This would, in particular, be the case if,

from a Swiss law perspective, there is no legislation in the foreign

country that can guarantee an appropriate level of protection. The

Federal Data Protection and Information Commissioner keeps a list

of foreign countries that are deemed to provide an appropriate level

of protection; this list may be viewed on the Commissioner’s website.

If there is no foreign legislation that can guarantee an appropriate

protection, employee data may only be transferred abroad under

certain circumstances, for example, after the employee has given his

or her consent or if the disclosure takes place within the same legal

entity or company, or between legal entities or companies of a

corporate group, provided that the entities and companies concerned

have committed themselves to certain minimal data protection rules.

8.2 Do employees have a right to obtain copies of any personal information that is held by their employer?

Every employee is in principle entitled to get unlimited access to all

data that has been collected in his or her regard. However, the

employer may restrict, deny or postpone access in case there is a

legal exception or if he or she can show preeminent own interests or

interests of third persons not to (fully) grant the requested access. In

this case, the employer must disclose the applicable limitation and

explain its reason to the employee.

The employee can exercise the right of access without

preconditions; in particular, he or she does not need to show a

particular interest. The right of access is exercised in writing, and is

free of charge. In general, the employer has 30 days to respond in

writing (and with photocopies), provided the employee does not

agree to another proceeding.

8.3 Are employers entitled to carry out pre-employment checks on prospective employees (such as criminal record checks)?

Yes, employers may carry out pre-employment checks on

prospective employees. However, these checks require the

knowledge and consent of the employee; they must have a close

connection to the employment and be proportionate.

As the case may be, the checks may concern licences, certificates

and non-compete covenants. If material to the employment, they

may involve extracts from criminal records, statements from the

debt collection office and statements concerning the employee’s

state of health.

8.4 Are employers entitled to monitor an employee’s emails, telephone calls or use of an employer’s computer system?

To the extent that the employment falls under the Labour Act,

monitoring mechanisms are not permitted if they are directed at the

employee’s behaviour. However, they may be permitted if they

pursue other aims, for example, security or controlling the proper

use of the work infrastructure and working time. Monitoring

mechanisms need to be codified in internal regulations and the latter

communicated to the employees.

In general, an employer will only be able to monitor peripheral data

(such as the point in time of the communications or interactions,

their length, and the involved connections). Monitoring the actual

content of communications requires outstanding interests, which the

employer will not easily be able to explain. As regards telephone

communications, in principle, they are protected by criminal law.

8.5 Can an employer control an employee’s use of social media in or outside the workplace?

An employer may control social media in the workplace if it is

necessary for the performance of the employment contract and

proportionate. Under these conditions, an employer may block

social media completely.


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In contrast, it is rather unlikely that an employer is able to show a

legitimate interest in controlling an employee’s use of social media

outside the workplace. However, this may for instance hold true for

ideological enterprises (“Tendenzbetriebe”).

9 Court Practice and Procedure

9.1 Which courts or tribunals have jurisdiction to hear employment-related complaints and what is their composition?

The 26 cantons are responsible for organising the court system.

Hence, depending on the place of jurisdiction, either a labour court or

an ordinary district court will hear employment-related complaints.

Labour courts will often be composed of a legally qualified district

judge and two lay judges, one elected on behalf of the

employees/trade unions and the other on behalf of the employers. If

there is no labour court one, or a panel of three, (usually) legally

qualified judges will hear the case.

9.2 What procedure applies to employment-related complaints? Is conciliation mandatory before a complaint can proceed? Does an employee have to pay a fee to submit a claim?

There is a mandatory conciliation hearing before a claim can be

filed. Thereafter, the proceedings start with an exchange of briefs,

unless the amount in dispute is below CHF30,000 and it is decided

that proceedings should be oral only.

Courts are usually prepared to outline their preliminary view of the

case during the first hearing. The majority of cases are settled based

on such preliminary assessments.

There are no court costs if the value of the dispute is below

CHF30,000; some cantons will apply a higher threshold. In all other

cantons, the claimant has to advance the likely costs. The amount of

the court costs depends on the value in dispute and the canton where

the claim is filed; they can be considerable. If the claim is upheld,

the defendant will be ordered to reimburse the paid costs to the

claimant. In addition, the losing party will be ordered to compensate

the other party for its lawyers’ fees (payment made according to a

schedule, not actual fees paid).

9.3 How long do employment-related complaints typically take to be decided?

The conciliation proceeding should take a few weeks only.

Thereafter, a straightforward claim in an oral proceeding (i.e., the

amount in dispute is below CHF30,000) should take less than six

months. Other cases might be pending for one to two years.

9.4 Is it possible to appeal against a first instance decision and if so how long do such appeals usually take?

There is a right to appeal within 30 days after the judgment has been

handed down. In most cantons, a panel of three judges of the court

of appeal will hear the appeal.

The Swiss Supreme Court will review decisions of courts of appeals

in employment matters if the amount in dispute exceeds

CHF15,000. Appeals are limited to points of law.

Acknowledgment

The authors would like to thank Dr. iur. Pierre-Yves Marro, LL.M.,

as well as lic. iur. Nina Rabaeus, LL.M., Homburger, for their

assistance in the preparation of this chapter.


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Dr. Balz Gross Homburger Prime Tower Hardstrasse 201 CH-8005 Zurich Switzerland Tel: +41 43 222 10 00

Fax: +41 43 222 15 00

Email: [email protected]

URL: www.homburger.ch

Dr. Gregor Bühler Homburger Prime Tower Hardstrasse 201 CH-8005 Zurich Switzerland Tel: +41 43 222 10 00

Fax: +41 43 222 15 00


URL: www.homburger.ch

Homburger is a leading Swiss business law firm with more than 150 lawyers representing and advising major international and Swiss clients.

The members of Homburger’s Employment Law working group are drawn from Homburger lawyers in the various practice teams, in particular from the internationally leading Litigation | Arbitration, Corporate | M&A and Tax practice teams.

Homburger represents its clients before Swiss courts and arbitration tribunals in employment-related matters and advises on all employment law issues, in particular on: employment contracts for executives, including compensation packages, non-compete covenants and “golden parachutes”; standard employment contracts and customised employment concepts (contracts, regulations, employee handbooks); employee participation plans and variable compensation schemes (e.g., long-term incentive schemes, management participation on acquisitions, stock option plans, bonus and gratification schemes); transfer of business units and outsourcing; business restructuring (staff reduction, collective dismissals), contract and garden leave; data protection; and posting of employees and work permit applications.

Homburger’s employment lawyers are in regular contact with distinguished employment experts in other jurisdictions.

Dr. iur. Balz Gross, LL.M. (born 1964) is a Partner at Homburger and Co-Head of Homburger’s top ranked interdisciplinary Employment Law Group. His employment practice focuses on advice on top management compensation, including bonus schemes, and related litigation and arbitration. Recognised as a leading individual in employment, litigation and arbitration in the relevant directories, he is also the head of Homburger’s Litigation/Arbitration Practice Team. He is an author of a commentary on Swiss cartel law (section on procedure), of the commentary on the Swiss Federal Act on Jurisdiction and Enforcement (section on contracts), the commentary on articles 68–96 of the Swiss Code of Obligations (relating to performance) and the commentary on the new Swiss Federal Act on Civil Procedure (section intervention, joinder, litis denuntiatio) and has published on legal proceedings, fraud and money laundering, recovery of assets and liability in tort.

From 1989–1992, he was a scientific assistant for contract and private international law at the University of Zurich and later, a District Court Clerk (1993). He was admitted to the Bar in 1994 and joined Homburger in 1995.

Education: Lic. iur./Dr. iur. Zurich, 1989/1996 (summa cum laude); LL.M., Harvard, 1995.

Dr. Gregor Bühler, LL.M. (born 1964) is a Partner and Co-Head of Homburger’s Employment Law Group. He frequently represents clients in employment disputes before Swiss courts. He further advises clients with respect to all areas of employment law, in particular with respect to privacy and intellectual property aspects and regarding the termination of employment relationships. His work also includes assistance to implement new employment terms and to transfer employment agreements and employee data in connection with commercial transactions.

Gregor Bühler was admitted to the Bar in 1992. He joined Homburger in 1995, becoming a Partner in 2003.

Education: Lic. iur./Dr. iur. St Gallen, 1990/1995; LL.M., Georgetown University, 1997.


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