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Employment law in Switzerland

Introduction

Swisscom has 18,372 full-time equivalent employees in Switzerland. It is therefore one of the country’s largest employers. The legal terms and conditions of employment in Switzerland are based on the Swiss Code of Obligations. The current collective employment agreement (CEA), which entered into force on 1 April 2015, sets out the key terms and conditions of employment between Swisscom and its employees. It also contains provisions governing relations between Swisscom and its social partners. The CEA of cablex AG likewise entered into force on 1 April 2015. At the end of December 2016, 15,392 Swisscom employees or 83% of the Swisscom workforce were covered by the collective employment agreement.

General terms and conditions of employment which exceed the minimum standard defined by the Code of Obligations govern the employment law provisions applicable to Swisscom management staff in Switzerland.

Employee representation and union relations

Swisscom is committed to fostering constructive dialogue with its social partners (the syndicom union and the transfair staff association) as well as the employee associations (employee representatives). The collective employment agreement (CEA) and the social plan constitute fair and consensual solutions. In the event of significant operational changes, Swisscom involves the social partners and employee associations at an early stage. The CEA grants the social partners and the employee associations rights of co-determination in various areas. In general and free elections in autumn 2013, Swisscom employees elected the new members of the employee associations charged with exercising these rights. Two employee representatives from the unions also sit on the Board of Directors of Swisscom Ltd.

Collective employment agreement (CEA)

The working week for employees covered by the Swisscom CEA is 40 hours. Among the progressive benefits defined by the CEA are five weeks’ annual leave, or 27 days from age 45 and six weeks’ annual leave from age 60, 17 weeks’ maternity leave and ten days’ paternity leave. Employees also enjoy an additional week of paid leave after five years of service. Swisscom pays a child and education allowance which in most cases is above the statutory cantonal allowance and grants leave on special family-related grounds such as adoption leave. In the event of incapacity to work due to illness or accident, Swisscom continues to pay the employee’s full salary for up to 730 days. The CEA places special emphasis on staff development while also improving the rights of part-time employees.

In November 2015, Swisscom negotiated the necessary CEA with the social partners on the basis of the revised Ordinance 1 to the Swiss Labour Law. This agreement provides for a waiver of time registration and was implemented on 1 January 2016, the date on which the amended ordinance took effect.

Working-hour models

Swisscom encourages its full-time and part-time employees to adopt an appropriate life domain balance by means of the following measures: Flexible working hours are the standard model used by a majority of employees. Other flexible working-hour models include annual working hours, a long-term working-time account and part-time work. In connection with this, Swisscom conducted the “Teilzeitmann” (part-time man) pilot trial in 2016. The experiment offered male employees the opportunity to work part-time on a trial basis and its aim was to dispel prejudice and increase the acceptance of part-time work. The “holiday purchasing” model allows employees to purchase additional leave. Employees may also work from home with the consent of their line manager. This option is used by many employees and is becoming increasingly easier thanks to solutions for modern communication and collaboration. Swisscom is a sponsor of the Work Smart initiative.

Combining work with the care of relatives at home presents a major challenge to those affected. Swisscom provides special support for employees who care for a relative or closely related individual in addition to their work duties. Two new flexible working-hour models named “Work & Care” have been added to the existing models to promote work-life balance, particularly where an employee is caring for a relative.

Social plan

Swisscom’s social plan sets out the benefits provided to employees covered by the CEA who are affected by redundancy. It utilises funds to improve employees’ prospects in the labour market. It also provides for retraining measures in the event of long-term job cuts. Responsibility for implementing the social plan lies with Worklink AG, a wholly owned subsidiary of Swisscom. Worklink AG opens up new prospects for Swisscom employees affected by job cuts, providing them with advice and support in their search for new employment outside the company or arranging temporary internal or external placements. The success rate is high, with 92% of those affected finding a new job in 2016 prior to the end of the social plan programme. Worklink is also committed to promoting and enhancing the employability of Swisscom employees by reviewing employees’ current status and providing career advice and coaching.

Swisscom also operates special employment schemes (such as phased partial retirement or temporary placements in similar areas of expertise) in line with its commitment to providing fair solutions for older employees affected by changes in skill set requirements or redundancy.

Employee remuneration

Salary system

Competitive pay packages help to attract and retain highly skilled and motivated specialists and managerial staff. Swisscom’s salary system comprises a basic salary, a variable performance-related component and bonuses. The basic salary is determined based on function, individual performance and the job market. The performance-related salary component is contingent on business performance as well as individual performance in the case of executive functions. Business performance is measured based on achievement of the Swisscom Group’s overarching targets and the targets of the respective business segment or division. The targets primarily relate to key financial indicators and customer loyalty. Individual performance is measured according to the achievement of results- and conduct-related goals. Details on remuneration paid to members of the Group Executive Board are provided in the Remuneration Report.

See report page 131
Minimum wage

There is no legally defined minimum wage in Switzerland. Instead, this is negotiated by the social partners in the context of collective employment agreements. The current CEA provides for a minimum salary of CHF 52,000, or CHF 50,000 in the case of the cablex CEA. Swisscom’s operations are spread throughout Switzerland, and when it comes to determining salaries there is very little difference between regions. A study of starting salaries for the youngest employees (up to age 21) found that the average basic annual salary in the function levels used for most job starters in this category was CHF 58,000 or CHF 56,500 at cablex; in other words, 12% and 13% respectively above the minimum salary defined by the relevant CEA.

Pay round

In February 2016, Swisscom and its social partners signed a two-year pay round agreement for 2016 and 2017. During the reporting year, Swisscom increased salaries in Switzerland by 0.4% of the total salary. Salary adjustments were made based on individual employee performance and specifically for employees with salaries that needed to be increased in line with the market. Management staff were only awarded salary increases in individual cases.

Equal pay

Swisscom takes great care to ensure equal pay for men and women. The company’s salary system is structured in such a way as to award equal pay for equivalent duties, responsibilities and performance. To this end, the individual functions are assigned to job levels according to their requirements. A salary band is assigned to each job depending on the market salary. The salary band stipulates the remuneration range for equivalent duties and responsibility. Pay is determined within this range based on the individual employee’s performance. As part of its salary review, Swisscom grants employees who have performed better and are lower within the respective salary band an above-average pay rise. In this way, any wage disparities are evened out on an ongoing basis. When conducting the salary review, Swisscom also checks whether there are any pay inequalities between men and women within individual organisational units and corrects them in a targeted manner.

Swisscom also uses the federal government’s equal pay tool (Logib) to conduct periodic reviews of its salary structures to ascertain whether disparities exist between men’s and women’s pay. Previous reviews have revealed only minor pay discrepancies, well under the tolerance threshold of 5%.