Employment Contract and Probationary Period in Switzerland: What You Need to Know

What is an employment contract in Switzerland, and what forms can it take?

The employment contract (Arbeitsvertrag / contrat de travail) is the agreement in which the employee commits to performing work and the employer to paying a salary. Its legal basis is Articles 319–362 of the OR.

In Switzerland, the contract can also be valid verbally, but the written form is highly recommended as it serves as evidence in case of a dispute.

The most common forms:

• Individual employment contract (Einzelarbeitsvertrag): a direct agreement between the employer and the employee.

• Collective employment agreement (Gesamtarbeitsvertrag, GAV / convention collective, CCT): applying to entire sectors, often with more favorable minimum conditions (e.g., construction, hospitality, healthcare).

• Fixed-term and open-ended contracts: a fixed-term contract ends automatically upon expiration, without notice.

If there is a generally binding GAV in the given sector, its rules override any less favorable points in the individual contract.

Probationary period: length, conditions, and termination rules

The probationary period is by default the first month (OR 335b). By written agreement, it can be extended to a maximum of three months.

During the probationary period, the notice period is seven days, and termination can take effect on any day.

Important details:

• If the employee does not actually work during the probationary period due to illness, accident, or statutory service, the probationary period is extended by this time.

• The purpose of the probationary period is mutual familiarization: both parties can withdraw more easily.

• GAV may differ: in some sectors, the probationary period can be shorter or longer.

Content of the employment contract: what must be recorded?

Swiss law does not prescribe a mandatory form, but without certain elements, the contract is difficult to interpret.

In practice, it is advisable to record these in writing:

The 13th month salary (13. Monatslohn) is common in Switzerland, but not a legal obligation – it is only payable if included in the contract or the GAV.

Place of work, working hours, and overtime in Swiss law

The upper limit of working hours is not regulated by the OR, but by the Labor Act (Arbeitsgesetz, ArG). The maximum weekly working hours are 45 hours in industrial plants, for office and technical workers, and in large-scale retail; in other sectors 50 hours.

Two concepts must be distinguished:

• Overtime (Überstunden): work exceeding the contractual working hours but below the statutory maximum. This must be compensated with a wage supplement (usually +25%) or time off, unless the parties have agreed otherwise in writing (OR 321c).

• Statutory overtime (Überzeit): work exceeding the 45/50-hour weekly limit, which is subject to stricter rules and a mandatory supplement.

The place of work is specified in the contract. This is also important from a Hungarian perspective: the taxation of cross-border commuters and those working in another canton may differ, and the rules of the canton of residence apply.

Termination and notice periods: from the perspective of the employer and employee

After the probationary period, the statutory notice period depends on the years of service (OR 335c):

• Year 1: 1 month

• Years 2–9: 2 months

• From year 10: 3 months

Notice is given for the end of the month unless otherwise agreed. The parties may deviate from the statutory notice periods, but a notice period of less than one month can only be established by a collective labor agreement, and only for the first year of service; the notice periods must be the same for both parties.

There are protected periods (Sperrfrist), during which the employer cannot validly terminate the employment (OR 336c): including during illness, accident, pregnancy, the postpartum period, and military service. The duration of the protection depends on the years of service.

Termination in Switzerland is valid without justification, but upon request, the reason must be provided in writing. Abusive (missbräuchlich) termination can have legal consequences.

Termination by mutual agreement and severance pay

The parties can also terminate the employment relationship by mutual agreement (Aufhebungsvertrag). In this case, they freely agree on the terms, but the agreement cannot deprive the employee of statutory minimum protection.

Important warning: mutual agreement can affect unemployment insurance (ALV). In certain cases, the RAV (regional employment center) waiting periods (Einstelltage) if it determines that the employee voluntarily contributed to the termination.

Statutory severance pay (Abgangsentschädigung) is only due in limited cases: mainly for employees over 50 who have been employed for at least 20 years (OR 339b), and in practice, this is often replaced by second pillar benefits.

Social security and contributions: who is obligated to do what?

Contributions are deducted from the gross salary by the employer and paid together with their own share. The main elements are:

• AHV/IV/EO (old-age, disability, and income compensation insurance)

• ALV (unemployment insurance)

• BVG (second pillar, occupational pension – mandatory above the official entry threshold; from 2025, above an annual AHV-subject salary of CHF 22,680)

• UVG (accident insurance, SUVA or private insurer)

• Family allowance contributions (varies by canton)

Part of the contributions is borne by the employer and part by the employee. In 2026, AHV/IV/EO totals 10.6%, of which 5.3% is the employee's share, and ALV totals 2.2%, of which 1.1% is the employee's share.

From a Hungarian perspective, two things are particularly important:

• Withholding tax (Quellensteuer): the income of foreign employees living in Switzerland without a C permit is typically deducted by the employer as withholding tax, at a rate that varies by canton.

• Pension coordination: the Swiss AHV and the Hungarian pension system under EU coordination (in the case of Switzerland, the FZA, the Agreement on the Free Movement of Persons) can be linked, so Swiss years are not lost.

As a Hungarian citizen, you are entitled to work in Switzerland as an EU citizen, and in parallel with Hungarian social security, the Swiss health insurance (KVG) is mandatory – its transfer must be arranged in time.

Practical advice: what to check before signing?

Before signing, it is advisable to review item by item:

1. Gross salary and payment frequency (12 or 13 monthly payments).

2. Exact length of the probationary period and its termination conditions.

3. Working hours, method of accounting for overtime.

4. Notice periods for both parties.

5. Amount of leave (at least the statutory 20 days).

6. Whether a GAV applies to the sector, and what it prescribes.

7. Place of work and the tax implications of possible commuting.

If any point is uncertain, it is recommended to consult with a professional or the employer's HR department before signing.

Sources

• ch.ch – Working in Switzerland: https://www.ch.ch/en/work/

• arbeit.swiss (SECO/ALV): https://www.arbeit.swiss/secoalv/en/home.html

• SECO – Work and labor law: https://www.seco.admin.ch/seco/en/home/Arbeit.html

• ch.ch – Official government portal: https://www.ch.ch/en/

• arbeit.swiss – Job placement and unemployment: https://www.arbeit.swiss/

• ch.ch — working hours — https://www.ch.ch/en/work/working-hours

• Fedlex OR/CO 335b — probation period — https://www.fedlex.admin.ch/eli/cc/27/317_321_377/en#art_335_b

• Fedlex OR/CO 335c — notice periods — https://www.fedlex.admin.ch/eli/cc/27/317_321_377/en#art_335_c

• Fedlex OR/CO 321c — overtime — https://www.fedlex.admin.ch/eli/cc/27/317_321_377/en#art_321_c

• Fedlex OR/CO 329a — holiday minimum — https://www.fedlex.admin.ch/eli/cc/27/317_321_377/en#art_329_a

• BSV — 2026 social insurance contribution rates — https://www.bsv.admin.ch/bsv/en/home/social-insurance/ueberblick/beitraege.html

• ch.ch — tax at source — https://www.ch.ch/en/foreign-nationals-in-switzerland/living-in-switzerland/tax-at-source

Related Articles

• Employment contract and probation period in Switzerland: what to watch out for?

• How to resign in Switzerland? Step-by-step guide

• G permit as a cross-border commuter: what you need to know

• What do you need to know about cross-border commuting in Switzerland as a Hungarian?

• How does the first pillar work in Switzerland from a Hungarian perspective?

• The complete guide to the Swiss healthcare system for Hungarians

Common mistakes when interpreting Swiss employment contracts

Before starting employment, there can be many misunderstandings that are worth avoiding. The most typical mistakes are the following:

• **Confusing gross and net salary:** Deductions (social contributions, withholding tax) from the gross salary stated in the contract make up a significant amount. Many do not take into account that the amount received in hand will be noticeably lower.

• **Ignoring the collective labor agreement (GAV):** If a binding GAV is in effect in the given sector, the employee tends to rely only on the individual contract, even though the GAV may provide more favorable conditions.

• **Unclear settlement of overtime:** A common mistake is that the parties do not record in writing what happens with work beyond the contractual working hours. If the contract excludes wage supplements or compensation in time off, it can lead to disputes later.

Decision points: what can and should be negotiated?

Although Swiss labor law and collective agreements regulate many issues, certain elements can be subject to negotiation during contracting:

• **Length of the probationary period:** Although the default duration is one month, the parties can decide on a shorter period or an extension up to a maximum of three months. It is worth considering which option provides greater security.

• **The 13th month salary:** Since this is not a legal obligation, it is crucial during salary negotiations to clarify whether the annual income will be paid in twelve or thirteen installments.

• **Compensation for overtime:** The employee may decide to request time off instead of a supplement for overtime, provided the employer is open to this.

Checklist for the probationary period

The probationary period is a time of mutual getting to know each other for both parties. For successful integration and legal security, the following steps are recommended:

• **Aligning expectations:** It is worth asking for feedback on the quality of work already in the first weeks.

• **Accurate tracking of working hours:** Documenting the hours worked, especially overtime, is essential to avoid any potential later settlement disputes.

• **Keeping the notice period in mind:** Since the notice period during the probationary period is extremely short (seven days), one must be prepared that the employment relationship can be terminated at any time, quickly.

• **Documenting illness:** If the employee falls ill, obtaining and submitting a medical certificate is immediately necessary, as this can extend the probationary period.

When to bring in an advisor

Although most employment contracts are clear, in certain situations it may be justified to consult a legal or labor advisor:

• **Complex, multi-cantonal work:** If the place of work changes constantly, clarifying tax and social security issues requires expertise.

• **Suspicion of termination during a protected period:** If the employer gives notice of termination during an illness, accident, or other protected period, it is highly recommended to immediately verify the legality of this action.

• **Before signing a mutual agreement:** Since a mutual agreement can negatively impact unemployment benefits, it is highly advisable to seek an independent opinion on the potential consequences before signing the document.

• **Abusive termination:** If there is a suspicion that the reason for termination is discriminatory or unlawful, exploring legal remedies is essential.