Swiss Code of Obligations (Obligationenrecht) and Employment
The Swiss Code of Obligations (Obligationenrecht, OR) is the federal law governing all employment relationships in Switzerland. It sets mandatory minimum standards for written contracts, wages, working hours, annual leave, notice periods, and cause for dismissal. Your canton may impose stricter rules; GAV (collective labour agreements) override the OR upward. You cannot contract below OR minimums.
The Obligationenrecht (OR) is Switzerland's federal civil code regulating contracts—including employment. Articles 319–362 specifically govern the employment relationship between you (employer) and your staff.
The OR establishes a legal floor, not a ceiling. Any agreement that falls below its minimums is automatically void and replaced by the OR standard. Cantonal labour laws and collective agreements (GAV) often go further.
When the OR applies
Every employment contract in Switzerland—whether full-time, part-time (measured in Pensum %), fixed-term, or probation—falls under the OR from day one. There is no exemption for startups, temporary staff, or small teams.
If your canton has issued stricter employment rules (e.g., Geneva's longer notice periods, Basel-Stadt's overtime rules), those bind you too. Always check your canton's ArG (Arbeitsgesetz) and any applicable GAV in your industry.
- Written employment contract required (OR 320); oral contracts are legally valid but risky—always document in writing
- Minimum 4 weeks' notice from either party (OR 337); many cantons and GAVs require longer
- Minimum 4 weeks' annual paid leave for employees under 20 and over 50; all others 2 weeks minimum (OR 329)
- Wages must be paid in full and on time; any unilateral deduction requires explicit written consent
- Probation period capped at 3 months for first employment; 1 month for job changes (OR 335a)
- Dismissal only valid with written notice; illegal termination (pregnancy, union activity, disability) is void
Your obligations as an employer
You must issue a written contract before or on the first working day, clearly stating job title, Pensum, salary in CHF, working hours, and canton of work. Vague terms invite disputes and are interpreted against you.
You are liable for workplace safety, timely wage payment, and lawful termination procedure. Violations expose you to wage claims (up to 2 years back), extra severance, and tribunal costs. Your liability insurer will not cover deliberate OR breaches.
- Maintain a wage record (Lohnkontrolle) showing hours, Pensum, gross salary, deductions, and net payment; inspectors may request it
- Issue an Arbeitszeugnis (employment certificate) on departure—must be truthful and fair; unjustly damaging references invite lawsuits
- Withhold Quellensteuer (payroll tax) and social insurance contributions; failure is your personal liability, not the company's
- Register all employees with cantonal authorities and the RAV/ORP/URC (regional unemployment office) within required timeframes
- Follow OR Article 362 for severance: if you terminate without just cause, add 1–2 months' salary as additional notice or immediate payment
- Keep employment records (contracts, timesheets, payroll) for at least 5 years for audits and disputes
Most common mistake
Assuming an oral agreement or informal chat counts as a valid contract. The OR requires written terms. Without them, disputes over salary, hours, or role default to the employee's favour—and burden of proof falls on you.
Second mistake: failing to distinguish between OR minimums and your canton's stricter rules. For example, Zurich's ArG may require notice periods longer than 4 weeks, or a GAV in your sector may mandate a 13. Monatslohn (13th-month bonus). Ignorance of local law is no defence in tribunal.
- Always draft a written contract before the first day; include job title, Pensum (e.g., 80%), CHF salary, hours, and canton
- Check your canton's ArG and any sector GAV before finalizing terms—they raise the floor, not lower it
- Use a lawyer or template service to review contracts; the cost prevents far costlier disputes later
- If you cannot afford employment counsel, contact your local business chamber (Handelskammer) or SME association for guidance
Frequently asked questions
- Can I pay a 50% Pensum employee less per hour than my full-time staff?
- No. The OR requires equal pay for equal work. Part-time staff must earn the same hourly rate (CHF/hour) as full-time peers in the same role. You may structure total salary differently only if roles, experience, or performance genuinely differ—not Pensum alone.
- What if my canton or GAV contradicts the OR?
- Cantonal ArG and gazetted GAVs always override the OR if they are stricter (more employee-friendly). You must follow the highest standard. If unclear, ask your canton's labour inspectorate (Arbeitsamt) or a labour lawyer.
- Can I avoid the OR by hiring 'contractors' instead of employees?
- No. Swiss courts use a substance-over-form test. If someone works under your control, on your premises, on your schedule, and depends on your income, they are an employee regardless of the label you give them. Misclassification triggers back pay and social-insurance penalties.
General information for Swiss employers, not legal advice. Have a lawyer confirm anything with legal consequences.