Security and legal

Coronavirus: What are the rights and obligations of companies?

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Cafés, restaurants, hairdressing salons and fitness studios are permitted to reopen from May 11, but under the FOPH’s strict regulations. Machines are still standing idle in many businesses due to delivery shortages and a drop in demand: coronavirus is presenting enormous challenges for companies.  

AXA-ARAG’s labor law experts answer the most important questions for employers in this national emergency.

Can I close may company and declare this as a holiday shutdown? This would be a way of getting round my employees’ absence. 

No, that's not an option. As an employer, you can of course decide the timing of holidays, but when you do, you must also take the wishes of your employees into account. Furthermore, employees have a right to be informed in advance of mandatory vacation, normally three months in advance.

Is it possible to ban vacation in my company in a pandemic?

As already mentioned, you can of course decide on the timing of holidays, but when you do, you must also take your employees into account and inform them in advance. Postponing vacation that has already been agreed is only justified on reasonable grounds. Should this be the case, your employees must accept the change in vacation. You must inform your employees of this postponement as soon as possible. You must bear any costs incurred as a result, such as cancellation costs of hotels or flights.  

Is it possible for my company to be placed under quarantine if staff have caught coronavirus?

In this case, the cantonal doctor would assess the situation and take any necessary steps. These would be health measures such as quarantine or closure of a business. 

Can I force my employees to be vaccinated against flu?

No, there is no compulsory vaccination in Switzerland. Even in a pandemic, it’s difficult for you as an employer to insist on compulsory vaccination. 

The authorities have ordered the closure of my business. What are the consequences for continued salary payments?

It is debatable who bears business and economic risk in a pandemic. As this situation has never arisen before, there is no case law and lawyers have differing opinions. It is therefore unclear whether or not employers have to continue paying salaries. As an employer, you can request reduced working hours. Your employees may be obliged to make up the  “missed”   work time under their loyalty obligation.

I’m worried about the rapid spread of coronavirus and the consequences of illness in my business. If I have to close down my company for that reason, what are my obligations and what does it mean for my employees?

In this case, as an employer you have an obligation to continue paying salaries to the affected employees. Your employees do not have to make up the work time unless the business is only closed very briefly. However, the salary payable in this event is reduced by any amounts that the employee saved as a result of being prevented from working or that he or she earned by performing other work.

Can I require my employees to work overtime during the coronavirus crisis?

Yes, that is possible. In a pandemic that results in many employees being laid off, it is justifiable for  employees to work overtime. However, you should take your employees’ personal circumstances and family situation into account. 

My company has an annual working time model that gives staff a great deal of flexibility. Can I ask them to compensate for their overtime in a pandemic?

Overtime can only be compensated through time off if employers and employees consent to this; they have to agree on the principle of compensation as well as on timing and duration. As the employer, you have to prove that your employees have agreed to this. If, for instance, the employment contract states that you as the employer have the right to unilaterally impose compensation, you can require them to compensate for their overtime.

What about unpaid leave in a pandemic?

You cannot force your employees to take unpaid leave. If there is not enough work or no work for your employees, you must  continue to pay their salaries. However, the salary payable in this event is reduced by any amounts that the employee saved as a result of being prevented from working or that he or she earned by performing other work.

The cantonal employment office answers questions on issues such as forms and advance notification of reduced working hours. The unemployment insurance fund is responsible for dealing with questions about benefits and calculations for reduced working hours.

When can I give notification of reduced working hours for my company and how do I have to do it? 

Delivery shortages, temporary closures and the slump in demand: coronavirus is forcing many companies to give notification of reduced working hours. As an entrepreneur, you can give advance notification of reduced working hours if you can prove a compelling link between your loss of working hours and coronavirus and if you meet the requirements for the right to compensation for reduced working hours specified by SECO.

What exactly do I have to prove?

A general reference to coronavirus is not enough to adequately illustrate the link. You must give a convincing explanation of how the fall in demand and work is linked to the pandemic. You should send the advance notification or notification to the cantonal employment office based in the same location as your company. 

You may claim compensation for reduced working hours in the following cases:

  • Due to difficulties with supplies –  caused by the coronavirus crisis – the raw materials required for production are no longer available, machinery is standing idle and your staff have no more work.
  • Raw materials required for production are unavailable due to import and export bans and your staff cannot perform their work. 
  • The authorities ordered the closure of your business and your staff can no longer perform their work.
  • You have to temporarily close your business due to the pandemic, as employees are in quarantine and there is a lack of suppliers and customers. However, if your staff stay home for fear of infection or because of family obligations, there is no entitlement to compensation for reduced working hours. 
  • Your staff can’t come to work due to the official restrictions on public transport . Please note: If your staff can cycle or drive to work, you cannot claim compensation for reduced working hours.

Can I also give notification of reduced working hours for apprentices, staff on a fixed-term contract or temporary staff?

Yes. On March 20, 2020, the Federal Council decided that these employees may also claim compensation for reduced working hours.

I have given notification of reduced working hours, but some of my staff still have overtime. Do my staff now have to reduce their overtime before I can request reduced workings hours?

As of recently, employees do not first have to reduce their overtime in order to benefit from compensation for reduced working hours.

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