Hiring your first engineer: Swiss employment basics

Swiss employment law is light by European standards but the few rules it has are unforgiving. Get the structure right on the first contract and you will reuse it ten times. Get it wrong and the first dismissal turns into a payroll problem with the cantonal Ausgleichskasse, the SVA and (if you forgot the IP clause) your investor's due diligence.

The entire frame sits in two places: the Code of Obligations (OR Art. 319 to Art. 362, the employment contract) and the Labour Act (ArG, the protective frame around working time, breaks and health). Every clause in your offer letter ladders to one of those two statutes.

Probation and notice

Probation runs up to three months with a seven-day notice period on either side under OR Art. 335b. After probation the statutory notice (OR Art. 335c) is one month in year one, two months in years two through nine, three months from year ten. You can extend by contract but not shorten below the statutory floor. Set probation to the full three months unless you have a specific reason not to. Notice always runs to the end of a calendar month, which means a 31 October termination served on 1 October ends 30 November, not 31 October.

Can I dismiss someone during probation if they show up sick on day eight?

Yes, with one trap. Probationary dismissal is legal during the seven-day notice window, but OR Art. 336c suspends notice during illness for thirty days in year one. If you served notice on day six and they fall ill on day seven, the notice is paused. Document the dismissal reason and the timing carefully, because Swiss courts will reverse a dismissal that looks retaliatory under OR Art. 336.

Social insurance and registrations

As soon as you hire, you owe AHV, IV, EO, ALV and family-allowance contributions. The combined employer rate sits around 6.5 percent of gross salary, the employee rate around 6.4 percent, withheld monthly. You also need an accident insurance contract (UVG) with SUVA or an approved insurer (around 0.7 to 1.5 percent of gross), and a pension fund (BVG) once gross salary crosses the entry threshold, currently CHF 22'680 per year. Register with a compensation office (Ausgleichskasse) before the first payslip. The Zurich SVA processes new-employer registrations in five to ten business days; Geneva runs slower, Zug runs faster.

IP assignment and inventions

Swiss law (OR Art. 332) assigns inventions made in the course of employment and as part of contractual duties to the employer automatically. Inventions made on the job but outside contractual duties go to the employer only if the contract expressly says so, against fair compensation. Add an explicit IP clause covering all work product, all code, and a duty to disclose within seven days of conception. Add a separate moral-rights waiver for design and copyright under URG Art. 16. Without the explicit clause your engineer's clever side project, built during working hours on company hardware, may not belong to you.

Non-compete after termination

Post-employment non-competes (OR Art. 340 to Art. 340c) are enforceable in Switzerland but narrowly: defined scope (specific product market, not 'tech'), defined territory (typically Switzerland, or one to three named cantons), defined duration of usually one year, never more than three, and only if the employee had genuine access to customer relationships or trade secrets. Courts strike down overbroad clauses without rewriting them, so the choice is precision or nothing. Plan a compensation payment of around fifty percent of last salary during the non-compete window; without it, the clause is hard to defend.

If a senior engineer leaves and joins a competitor, can I actually enforce the non-compete?

Sometimes. You need to show (a) genuine access to confidential information, (b) actual harm or threat of harm, (c) proportionate scope, and (d) ideally a compensation clause that you have honoured. Swiss courts grant interim injunctions under ZPO Art. 261 in roughly half the cases, faster in Zurich (two to four weeks) than in Vaud (six to ten weeks). Expect CHF 15'000 to 40'000 in lawyer fees for an interim measure. Most cases settle for a payment and a narrow consent decree.

Vacation, overtime, the 13th salary

Statutory minimum is four weeks paid vacation (OR Art. 329a), five weeks for employees under twenty. Overtime above the statutory weekly cap of 45 hours (office work) or 50 hours (technical and industrial) triggers a 25 percent surcharge unless compensated in time off (ArG Art. 12 and 13). The 13th-month salary is not statutory but is market-standard in Switzerland; if you do not offer it, your salary is read by candidates as twelve-thirteenths of what they expect. Most founders set 25 days vacation, a clean overtime offset clause in time, and a 13th salary, and call it the Swiss baseline.

Work permits for non-EU hires

Hiring a non-EU engineer means a B permit, an annual cantonal quota (Zurich 2024: 200 quotas for the year, exhausted by September in most years), and a process that takes eight to twelve weeks from job posting to first day. Build a buffer. Document the search (Stelleninserat for at least four weeks on RAV and your careers page), run the labour-market test, and prepare the application before you make the verbal offer so the candidate hears the same timeline you do. Highly qualified specialists with rare skills can argue priority under FZA Art. 23.

What is the realistic budget for hiring my first non-EU engineer?

Budget CHF 4'000 to 8'000 in administrative and legal cost for the permit application (specialised immigration counsel runs CHF 350 to 550 per hour, fifteen to twenty hours of work for a clean case), CHF 5'000 to 10'000 in relocation support (flight, deposit, registration), and three months of runway before the engineer can produce. The total marginal cost above the salary is CHF 15'000 to 25'000 for the first year. EU hires cost a tenth of that and start in four weeks.