Short-time working and mass redundancies
A company may be forced to take measures to lower staff costs in the event of a deterioration in the order situation or for other reasons. Overcapacity may be alleviated through a temporary reduction in or complete halt to production. In order to maintain jobs, the employer receives 80% of the lost income of the employees for a specific period from unemployment insurance by applying for short-time working. This is done to prevent dismissal as a result of a temporary and unavoidable lack of work.
Dismissals are the last means that a company can resort to when utilization levels fluctuate. In the event of mass redundancies, Sections 335d-335g of the Swiss Code of Obligations stipulate that the employer
- must consult the employees, and
- must inform the cantonal labour office in writing
Compared with other countries, Switzerland has highly investor-friendly labour market provisions. It is relatively easy for companies to appoint and dismiss employees.
Appointments and dismissals (2010)
1 = hampered by regulation, 7 = employers have flexibility in decision-making
Source: World Economic Forum, The Global Competitiveness Report 2010-2011,
www.weforum.org