Employment contracts in Switzerland

In Switzerland, the employment contract is governed by the provisions of the Swiss Code of Obligations (CO) as well as other laws and regulations applicable in certain sectors of activity. The CO provides the general rules regarding employment contracts, which apply to all employers and employees in Switzerland. Other laws and regulations are specific to certain professions or types of workers.

The employment contract is an agreement between an employer and an employee, in which the employer undertakes to provide work to the employee and to pay them a salary in return for their work. Although the contract can be concluded orally, it is recommended to put it in writing to avoid any misunderstanding or disagreement. 

Types of contracts (permanent, fixed-term, temporary, etc.)

There are indeed several types of employment contracts in Switzerland, each with specific characteristics in terms of duration, obligations, and rights of employers and employees. The main types of employment contracts in Switzerland are as follows:
A permanent contract (CDI) is the most common type of employment contract in Switzerland. It is concluded for an indefinite duration, and the parties may agree on a probation period.

A fixed-term contract (CDD) is concluded for a specified period, which can vary from a few months to several years. It automatically ends at the expiry of the agreed period. The parties may also agree on a probation period.

A temporary employment contract (CTT) is a fixed-term employment contract concluded between a temporary employment agency (ETT) and a temporary worker who is made available to a user company for a temporary assignment. The contract automatically ends at the end of the assignment.

Drafting and essential clauses

In Switzerland, the principle of contractual freedom (art. 19 CO) governs the conclusion of an employment contract. This principle gives the parties the freedom to negotiate the terms and conditions of their agreement, provided they comply with the mandatory provisions set by the law.
The employment contract must contain certain essential clauses to protect the rights and obligations of the parties. When an employment contract is signed between an employer and a worker in Switzerland, it must necessarily include certain information such as the name of the worker and the employer, the start date of the employment relationship, the worker’s role, the salary along with any additional salary components, and the weekly working hours. In the case of fixed-term contracts, the employer must also clearly specify the end date of the employment contract.

Moreover, all special rules relating to the employment contract, such as non-compete clauses or overtime, must be included in the contract. It is important to draft these clauses carefully to avoid any misunderstanding or potential dispute.

Modification and termination of the contract

The employment contract can be modified or terminated in different ways, depending on the circumstances. Indeed, it can be modified by mutual agreement between the employer and the employee. If the modification affects essential clauses of the contract, the employee’s consent is mandatory.
No notice is required to terminate a fixed-term contract (art. 334 para. 1 CO). Indefinite-term contracts can be terminated by the employer or the employee (art. 335 para. 1 CO). However, certain notice periods must be respected depending on the circumstances (art. 335a ss CO). During the probation period, generally the first month of work, the contract can be terminated by the employer or the employee at any time (art. 335b para. 1 CO).

When a worker is on sick leave or a victim of an accident, they are protected against dismissal by the employer. This protection applies for a period that varies depending on the length of service of the worker: 30 days during the first year of service, 90 days from the second to the fifth year, and 180 days from the sixth year onwards (art. 336c para. 1 let. b CO). Women have the same protection during their pregnancy and for 16 weeks following childbirth (art. 336c para. 1 let. c CO).

The party terminating the employment contract abusively is required to pay compensation to the other party (art. 336a CO).

The employment contract can be terminated immediately and without notice if one of the parties commits a serious fault making the continuation of the employment relationship impossible (art. 337 CO). A serious fault is defined as such a significant and fundamental violation of the obligations arising from the employment contract that the aggrieved party can no longer be expected to maintain the contract in force. This can include acts such as theft, violence, harassment, or the disclosure of trade secrets.

In case of a question or conflict related to the employment contract, it is strongly advised to consult a lawyer specialized in labor law, in order to obtain legal advice and assistance in protecting the rights and interests of either the employer or the employee.