According to Article 329d of the Swiss Code of Obligations (CO), employers are obligated to pay employees for their vacation time.
As stipulated in Article 329a, paragraph 1 of the CO, employers must grant employees at least four weeks of vacation per year of service. Furthermore, employees under the age of 20 are entitled to five weeks of vacation per year of service. According to Article 329c, paragraph 1 of the CO, vacations must be taken within the corresponding year. If vacations cannot be taken during the applicable year, employees have the right to carry over their accrued vacation for up to five years, as governed by Article 128, letter 3 of the CO.
During vacation, as per Article 329d of the CO, the employer is required to pay the full salary. Moreover, employees should receive the same salary treatment during their vacation as they do while working. Their salary should neither decrease nor increase due to their vacation.
However, vacation compensation must be paid in addition to the base salary when it is challenging to calculate the vacation salary. This applies to temporary and irregular part-time work. Therefore, it is crucial for vacation compensation to be precisely mentioned in the salary statement and employment contract. To calculate vacation salary, the Federal Supreme Court has established rates to apply to the gross salary:
8.33% for 4 weeks of annual vacation
10.64% for 5 weeks of annual vacation
13.04% for 6 weeks of annual vacation
Here is an example calculation for annual vacation compensation:
Base hourly wage: CHF 25.00
Vacation compensation for 4 weeks annually: 8.33% * CHF 25.00 = CHF 2.08
Base hourly wage with vacation compensation: CHF 25.00 + CHF 2.08 = CHF 27.08
According to Article 329, paragraph 2 of the CO, there is a mandatory principle that during the employment relationship, vacations cannot be replaced by monetary payments or other benefits. Vacations must be taken in kind to protect the employee's health and ensure rest time.
Payment of Vacation Balance and Notice Period:
As much as possible, the remaining vacation balance during the notice period should be taken in kind, especially when the notice period is long and the vacation balance is low. However, if the notice period is short and the vacation balance is high, it is possible to compensate for the vacation in cash. The compensation should be reasonably proportionate to the length of the work release period and the number of vacation days to be taken (ATF 128 III 271). For example, for one month of leave, a maximum of one week of vacation can be compensated (TF 4C.215/2005 of December 20, 2005). Additionally, compensation can go up to 15 days of vacation within a maximum of 3 months of work release (TF 4C.215/2005 of December 20, 2005). Any remaining vacation balance that cannot be taken in kind must be compensated in cash.
Exceptions to Vacation Payment:
An exception to vacation payment is regulated by Article 329d, paragraph 3 of the CO. Employers may refuse to pay vacation compensation if the employee engages in paid work during their vacation that prejudices the employer's interests. For example, an employer may refuse to pay vacation compensation if the employee is competing with their employer. Additionally, the employer can demand the repayment of vacation compensation if it has already been paid.
For more detailed information on this subject, Valentin Legal Consultation would be happy to welcome you to their office located at rue du Valentin 1, 1004 Lausanne. We are also available by phone at 021 351 30 00 or by email at info@cjdv.ch.
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