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CONVINUS Global Mobility Insights NEWSLETTER Herbst / Fall 2023

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Global Mobility Insights - Herbst / Fall 2023 market controls in Switzerland Labour Author: Brizida Alani, CONVINUS Switzerland concluded the Agreement on the Free Movement of Personswith the European Union on 1 June 2002. This allows EU and Swisscitizens to freelychoose theirplace of work and residence within the EU and Switzerland. Initially, the prior control of compliance with customary working and wage conditions was waived as a prerequisite for the granting of a permit. Gradually, the pressure on local workers and their remuneration increased, which is why the accompanying measures were introduced as monitoring measures. The Posted Workers Act (EntsG) forms the legal basis for the accompanying measures. In addition, there are also the generally binding collective labour agreements and the enactment of standard employment contracts. The aim of the accompanying measures is to comprehensively monitor the Swiss labour market, in particular to guarantee the legally prescribed working and wage conditions at Swiss employers and assignment companies. All posted workers must be protected against undercutting of wages and working conditions in Switzerland. The enforcement bodies - namely the joint and tripartite commissions - have SECO as their supervisory authority, which defines the qualitative and quantitative requirements of the control procedures. Based on the legal obligation in the Posted Workers Act, the enforcement bodies are compensated 50% by the canton and 50% by the Confederation or SECO. The joint commissions receive a lump sum of CHF 650 for each inspection and are financed by an hourly rate of CHF 100 for special inspections. The national minimum target for checks is set at 35,000 per year. The checks between the different categories of workers are carried out on a risk basis, reflecting the intention to increasingly check posted workers, who are most affected due to the wage gap between Switzerland and the EU/EFTA countries (e.g., Italy, Poland, etc.). In current practice, 30-50% of all posted workers and selfemployed service providers who are required to register are checked. In contrast, only 3% to 5% of all Swiss employers are targeted by the controls. 32

Global Mobility Insights - Herbst / Fall 2023 According to the latest report on the accompanying measures of June 2023, 37,134 companies and 165,845 persons were scrutinised in connection with the inspections carried out in 2022. This is approximately 4% more inspections than in the previous year. Swiss employers in particular were inspected 14% more than in the previous year, whereas approximately 10% fewer inspections were carried out on posted workers and self-employed persons. Against this background, it is important that employment or secondment in Switzerland takes place in accordance with the law. The following aspects represent fundamental compliance hurdles: 1. Work permit (overview of the most important types of permits) 1.1 Local employment of third-country nationals Third-country nationals with a local Swiss employment contract require a day 1 work permit in Switzerland. This is only granted if the person is a specialist whose employment represents an economic or scientific interest for Switzerland. A specialist is someone who can prove a university diploma as well as several years of professional experience in the same field of their specialisation. The position must be advertised in advance for up to 3 months within Switzerland (via RAV) and the EU/EFTA (via EURES). As part of the search efforts, the employer must disclose the list of applicants including reasons for rejections. The employer must essentially prove that the person to be hired is the best qualified candidate for the job. The employer must also comply with the wage and labour market conditions customary in the locality and the industry, which is why the Swiss minimumwage must be guaranteed. Wages set by collective agreements are negotiated by the contracting parties and are considered minimum wages. In the absence of collective agreements, the wageto be paid must be calculated using a wage calculator. Alternatively, the wage books or the cantonal calculation platforms are available. Sometimes changing jobs and professions is not possible duringthe first two years.Any change of function,whether in a lower or higher position, is subject to authorisation. 33

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