Legal | Tax | Compliance
Legal | Tax | Compliance
The trend towards teleworking/home office keeps continuing. In our article, we shed light on the legal situation of this increasingly popular work model in Switzerland.
Switzerland is an attractive place for employees, not least because of its high salaries and low-income taxation. At the same time, the Swiss economy needs skilled professionals and the Covid-19 pandemic in particular has shown how acute the shortage of qualified employees is in certain sectors. If you are considering moving to Switzerland, the following article will provide you with information on the topic of teleworking/home office.
Principle
There is no statutory right to telework/home office. Neither can an employer instruct its employees to work from home without reason and contrary to the agreement of a different place of work in the employment contract. If an employee wishes to work permanently or regularly in home office, this requires a corresponding contractual agreement with the employer.
Work tools and materials, compensation and expenses
If an employee, with the employer's consent, uses his own work tools (e.g. laptop or mobile phone) or materials to perform work in home office, he is entitled to a reasonable compensation for this, unless otherwise provided by agreement or custom. In addition, the employee may be entitled to compensation if he uses a room of his private apartment or for instance, a part of his living room, for teleworking/home office. This is exclusively applicable if no space is available for the employee in the employer's office premises. In this situation, the employer must also bear a share of the costs for electricity or internet. It is also possible in this case to agree on a daily, weekly or monthly lump sum for expenses.
Prevention of work performance in home office
If the employer allows its employees to telework or to work in home office, it also bears the associated risks. This applies, for example, to disruptions such as a power outage or a failure of the internet connection during which no work can be performed from home. This is subject to the condition that the employee himself is not responsible for the disruption. In such cases, he must also return to the office if this is possible within a reasonable period of time.
Liability of employees
An employee may be liable for the loss or intentional or negligent damage of work tools and materials, as well as for the loss or theft of internal data and documents. It is therefore advisable to reach a clear agreement with the employer regarding the consequences and the procedure to be followed in the event of such loss or damage.
According to a principle of the Agreement on the Free Movement of Persons and the EFTA Convention, an employee who works a "substantial part" of his job - i.e. 25% or more - in his country of residence must also be insured there. In view of the altered work reality due to the Covid 19 pandemic, the social security subordination rules under the Agreement on the Free Movement of Persons and the EFTA Convention have been interpreted more flexibly in the case of telework/home office. The rules developed specifically for the pandemic no longer apply as of 1 July 2023. However, since this date there have been bilateral/multilateral agreements with various EU/EFTA member states - although not with all of them - according to which cross-border work in a home office does not lead to a change in social security status as long as this work is less than 50%. However, for all EU/EFTA member states with which no such bilateral agreement is in force, a home office activity that constitutes a "substantial part" leads to a change in social security status.
In labour disputes, the usual place of work establishes a place of jurisdiction. The predominant activity in home office abroad can therefore entail the jurisdiction of a foreign court, which gives the employee the possibility to sue his Swiss employer at his place of residence and work. As a consequence, it cannot be excluded that the foreign judge will apply his own labour law despite a choice of law clause to the contrary, insofar as it is mor favorable for the employee. Especially in states bordering Switzerland, this means a much more employee-friendly labour law.
Employees who work for a longer period of time in home office in their country of residence (and not in the employer's country) can, under certain circumstances, establish a permanent establishment for the employer there. This may be the case, for example, if the employee performs management functions or is authorised to conclude contracts on behalf of the employer.
In order to avoid an additional tax burden and administrative effort due to the establishment of a permanent establishment through teleworking/home office, it is necessary for the employer to check and, if necessary, even restrict the activities of the employees concerned.
Our team of labour law experts will be happy to advise you on all questions in this area. We look forward to hearing from you.
You can find more information on the topic of "Moving to Switzerland" in our free whitepaper.
