Read news from:
Austria
SHARE
COPY LINK
For members

WORKING IN SWITZERLAND

What unemployment benefits are foreign workers in Switzerland entitled to?

The unemployment rate is currently very low in Switzerland — 2.1 percent — and the demand in many sectors is high, so employers don’t routinely fire skilled workers. It can, however, happen that you lose your job nevertheless. What are you entitled to in this case?

Published: 30 March 2023 16:23 CEST
Updated: 30 January 2024 08:56 CET
A person on a computer
Image by StartupStockPhotos from Pixabay

The general rule is that if you have been legally working in Switzerland and contributing to the social insurance scheme, then you are entitled to receive unemployment benefits.

Everyone who is working in Switzerland, except those who are self-employed, are insured for unemployment.

However, when it comes to receiving benefits, not everyone receives the same. 

If you have a settlement permit C or a residence permit B, you will receive unemployment benefits, as long as you have been employed in Switzerland for at least 12 months in the last two years and have been living in the country full time during that period.

The ‘permanent residency’ requirement excludes cross-border workers, but there are other provisions for them in place in case of a job loss (see below).

As far as short-term permit L is concerned, which is issued for residency periods of three months up to a year, you are not entitled to collect unemployment benefits, but you are allowed to remain in Switzerland to look for another job after getting a special permission from your cantonal immigration office. 

If you have a B or C permit, how much compensation will you be receiving and for how long?

The period and the amount are the same regardless of whether you are a foreigner or Swiss citizen.

In other words, the compensation is not based on your nationality or permit but on your contributions to the unemployment scheme.

A man on a computer

You must accept any reasonable job offer that comes your way. Image by Steve DiMatteo from Pixabay

Generally, you will receive an amount equivalent to 70 percent of your average salary for the past six months.

In certain cases, you will get 80 percent of your salary, but only if you have dependent children below 25 years of age; your monthly income is less than 3,797 francs; or you have invalidity (for example a long term illness or disability) of at least 40 percent.

READ ALSO: An essential guide to being unemployed in Switzerland

How long will the benefits be paid out depends on your circumstances.

If you have worked — and paid into the social security system — for 12 months in the past two years, you are entitled to 260 days’ worth of unemployment allowance.

If you are under 25 and childless, you will receive compensation for 200 days.

In the case that you had been employed for at least 18 months, you will collect for 400 days.

Older workers or those suffering from a disability can collect for 120 additional days.

There are, however, strict conditions.

If you think you can sit home and do nothing while collecting your compensation or go on a holiday while the money comes into your bank account, you are wrong.

In fact, being out of work in Switzerland is actually…hard work.

Among the obligations you must comply with, other than showing up for appointments with your unemployment counsellor, is

  • Sending out a certain number of job applications per month
  • Attending continuing education courses 
  • Participating in programmes to improve your skills and your employability

If you don’t, your benefits could be reduced.

You must also accept jobs that are being offered to you. You can refuse them only under certain circumstances — for instance, if the salary offered is less than 70 percent of your former income; your health doesn’t allow you to take on the job; or the commute to and from work is more than two hours each way.

What about cross-border workers?

As mentioned above, these rules only apply to permanent B or C residents, which G-permit holders (cross-border workers) are not.

They will receive unemployment benefits from their country of residence, based on that country’s, rather than Switzerland’s,  unemployment scheme.

They must therefore register with their local authorities to claim compensation.

More information about unemployment compensation can be found here. 

EXPLAINED: Who can work in Switzerland but live in a neighbouring country?

Member comments

Log in here to leave a comment.
Become a Member to leave a comment.
For members

WORKING IN SWITZERLAND

The pitfalls of Switzerland’s social security system you need to avoid

In most cases, Switzerland’s social benefits system functions well. But there are also some loopholes you should know about.

Published: 24 April 2024 13:37 CEST
The pitfalls of Switzerland's social security system you need to avoid

The Swiss social security system has several branches: old-age, survivors’ and disability insurance; health and accident insurance; unemployment benefits, and family allowances.

This is a pretty comprehensive package, which covers everyone who pays into the scheme for a wide variety of ‘what ifs’.

As the government explains it, “people living and working in Switzerland benefit from a tightly woven network of social insurance schemes designed to safeguard them against risks that would otherwise overwhelm them financially.” 

But while most residents of Switzerland are able to benefit, at least to some extent, from this system, others don’t.

What is happening?

If someone becomes ill or has an accident, Switzerland’s compulsory health insurance and / or accident insurance will cover the costs.

However, a prolonged absence from work can become costly.

That is especially the case of people employed by companies that don’t have a collective labour agreement (CLA), a contract negotiated between Switzerland’s trade unions and employers or employer organisations that covers a wide range of workers’ rights. 

READ ALSO: What is a Swiss collective bargaining agreement — and how could it benefit you?

It is estimated that roughly half of Switzerland’s workforce of about 5 million people are not covered by a CLA.

If you just happen to work for a company without a CLA, your employer is not required to pay your salary if your illness is long.

You will receive money for a minimum of three weeks – longer, depending on seniority — but certainly not for the long-haul.

You may think that once your wages stop, the disability insurance (DI) will kick in.

But that’s not the case.

The reason is that DI can be paid only after a year after the wages stop. In practice, however, it sometimes takes several years of investigations and verifications to make sure the person is actually eligible to collect these benefits, rather than just pretending to be sick. 

In the meantime, these people have to use their savings to live on.

What about ‘daily allowance insurance’?

Many companies (especially those covered by a CLA) take out this insurance, so they can pay wages to their sick employees for longer periods of time.

However, this insurance is optional for employers without a CLA is place.

As a result, small companies forego it because it is too much of a financial burden for them.

And people who are self-employed face a problem in this area as well: insurance carriers can (and often do) refuse to cover people they deem to be ‘too risky’ in terms of their age or health status.

Critics are calling the two situations —the length of time it takes for the disability insurance to kick in and gaps in the daily allowance insurance—”perhaps the biggest failures of the social security system.”

Is anything being done to remedy this situation?

Given numerous complaints about the unfairness of the current system, the Social Security and Public Health Commission of the Council of States (CSSS-E) will look into the “consequences of shortcomings and numerous dysfunctions in long-term illness insurance.”

But not everyone in Switzerland sees a problem in the current situation.

According to the Swiss Insurance Association (SIA), for instance, “making daily sickness allowance insurance compulsory for employers would not have the desired effect. Due to false incentives, it would only exacerbate the upward trend in costs and premiums.”

SHOW COMMENTS