Many companies are severely affected by the federal and cantonal governments' measures to prevent the spread of the corona virus, and, depending on the sector, could be faced by sharp falls in employment and sales. In order to cushion the economic impact as much as possible, and to be able to support the affected people and industries as quickly and as unbureaucratically as possible, the Federal Council has issued a package of measures for companies and employees that includes the services described below.
Short-time work compensation in general and relief from the corona virus
Short-time work means the temporary reduction or complete cessation of work in a company. In order to compensate for related temporary job losses and to allow the preservation of jobs, the legislator has provided for the instrument of short-time work compensation. The short-time work allowance will not be granted to companies that are suffering from an ongoing or sustained decline in sales and/or employment.
Companies that have had to cease their activities in connection with the corona virus pandemic due to official measures or based on the duty of care of the employer are entitled to short-time work compensation, in accordance with Art. 32 para. 3 of the Unemployment Insurance Act (AVIG). The short-time work allowance is 80% of the employee's wages, and is paid for a maximum of 12 payroll periods within 2 years.
Procedure for receiving the short-time work allowance
Expansion and simplification of short-time work
Due to the current exceptional situation in terms of the economy, entitlement to short-time work allowances have been expanded as follows:
The approval procedure for short-time work has also been simplified as follows:
Compensation for loss of earnings for the self-employed
Self-employed persons who suffer loss of earnings due to official measures to combat the coronavirus are also to be compensated. Compensation in the form of a daily allowance is provided for the following cases:
The daily allowance to be paid corresponds to 80% of income, capped at a maximum of CHF 196 per day. The compensation is subsidiary. This means that if the beneficiary already receives benefits from another social or private insurance (e.g. daily allowance from a health insurance company) or continues to receive their wages, they are not entitled to compensation.
Compensation for loss of earnings for employees
Analogous to the self-employed, parents who have to stop working to look after their children due to school closures are also entitled to a daily allowance. There is also a right to compensation in the event of a temporary cessation of work due to quarantine mandated by a doctor. The daily allowance to be paid corresponds to 80% of income, capped at a maximum of CHF 196 per day.
The compensation is subsidiary. This means that if the beneficiaries already receive benefits from another social or private insurance scheme (e.g. employees who are already in receipt of a short-time work allowance) or continue to receive their wages, they are not entitled to such compensation. In the case of continued payment of wages, the employer is the entitled be¬neficiary.
Liquidity support for companies
COVID bridging loans Declines in liquidity due to the forced closure of SMEs (sole proprietorships, partnerships, legal entities) as well as due to declines in demand are alleviated by means of government-guaranteed COVID bridging loans, which are to be paid out by banks and are to be understood as emergency aid.
The following general conditions apply to a COVID bridging loan:
Further information on COVID bridging loans: https://covid19.easygov.swiss/
Postponement of payment of social security contributions
The companies affected by the crisis can be granted a temporary, interest-free deferral of payments for social security contributions (AHV/IV/EO/ALV). The companies also have the option of having the amount of regular payments of AHV/IV/EO/ALV on account adjusted if the wage total has decreased significantly. The same applies to the self-employed whose sales have fallen significantly. The AHV compensation fund administration is responsible for checking the deferral of payments and reducing the account contributions.
Liquidity buffer in the tax area and for federal suppliers
Companies affected by the crisis should be able to extend the payment deadlines for the following taxes/duties, whereby the interest rates are reduced to 0.0%, and no default interest is due:
Invoices payable to federal institutions are also checked quickly and paid out as fast as possible, without regard for the payment deadlines. This strengthens the liquidity of federal suppliers.
Legal cessation in accordance with the Federal Law on Debt Enforcement and Bankruptcy (SchkG)
From 19th March to and including 4th April 2020, no debts are legally enforced throughout Switzerland. If you have any questions or need support regarding one or more of the above points, we are at your disposal.