Switzerland: Calculation Of The Swiss Minimum Wage

Legal situation

The minimum wage for posted employees is laid down in Art. 2 of the Posted Workers Act in combination with Art. 1 of the Posted Workers Ordinance. This article covers not only the gross wage as the minimum wage, in relation to the usual working hours and the qualifications acquired, but also other wage components such as:

• the compulsory increases in minimum and effective wages based on calculation
• the compulsory wage supplements for overtime, piecework, shift work, night work, work on Sundays and public holidays, and arduous work, where applicable
• the proportionate holiday pay
• the pro rata 13th or 14th month's pay
• paid public holidays and rest days
• the continued payment of wages if the employee is prevented from working through no fault of his own within the meaning of Art. 324a CO (incl. collective daily sickness benefit insurance)
• the salary in the event of default on the part of the employer within the meaning of Art. 324 CO

In regulated professions (e.g., electricians), employees (including posted workers) are usually protected by collective labor agreements (GAV). The minimum wages stipulated in the respective CLA are decisive for Swiss and foreign employers. The method of calculating the minimum wage differs depending on the type of occupation.

Consequently, we present the different practice options:

1. Salarium / wage calculator

In the case of non-protected occupations, such as in the IT sector, the equivalent Swiss minimum wage for posted workers is calculated in practice via the online platforms of the Salarium (statistical wage calculator) https://www.gate.bfs.admin.ch/salarium/public/index.html#/start or then via the national wage calculator https://entsendung.admin.ch/Lohnrechner/lohnberechnung. Even if the results do not represent wage recommendations, they are nevertheless authoritative as guidelines for the Swiss minimum wage or for obtaining a work permit.

For both platforms, you need to know or determine the following information about the employee and the foreign employer:

• age of the employee
• years of service
• education
• position in the company (with or without management function)
• occupational group and/or sector
• hours per week
• canton or region of employment

2. Calculation of the international wage comparison

SECO has compiled a directive on the determination of the "international wage comparison", according to which this can be calculated quite precisely. It is somewhat more difficult to work with this methodology in practice, as the amount of information required is impractical, especially when dealing with short-term assignments that have to be reported on an urgent basis (keyword reporting procedure). However, this calculation methodology comes closest to the legal requirements under Swiss posting law. For this methodology, you must have the following information:

On the above table and for the data in Switzerland, you will need to use the calculated wage as per the Salarium/Wage Calculator or according to the CLA for the assignment in Switzerland. The result therefore shows how much the difference actually is, which then has to be paid for the working days in Switzerland.

3. Calculation via the applicable CLA

First of all, you need to know whether the employee / posted worker concerned works in an area protected by a CLA. The various CLAs can be found on the SECO website https://www.seco.admin.ch/seco/de/home/Arbeit/Personenfreizugigkeit_Arbeitsbeziehun-gen/Gesamtarbeitsvertraege_Normalarbeitsvertraege/Gesamtarbeitsvertraege_Kantone.html .

The relevant amount is the gross salary mentioned in the CLA for the specific occupation, before deduction of social security contributions. Social security contributions are therefore not included in the calculation of the salary comparison. In particular, health insurance contributions, which are paid in Germany as an employer, are not included. The rest of the calculation is based on the SECO methodology, with the only difference being that in Switzerland, the minimum wage for the occupation is applied as the basic wage.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.