Last update on August 10, 2020
The various measures implemented by the Confederation, the cantons, the compensation funds, the banks and other stakeholders come from all sides. They can have a direct impact on helping your company fight this coronavirus crisis. Let’s have a look at the various initiatives.
Compensation in the event of loss of work related to coronavirus
- Reduction of working hours (RHT)
- Social charges payment and Human Resources
- Loss of earnings for the self-employed and the employees who took care of their children
FER has published this infographic on 14 April 2020 (last update on July 7, 2020) which summarizes the rights and obligations of entrepreneurs in Geneva in this specific period:
By authorizing the employer to temporarily reduce the working time defined by a contract, this measure allows the entitled worker to receive a compensation. The aim is to preserve jobs and avoid layoff.
Previously applicable only to specific populations, the Confederation recently extended the RHT to fixed-term contracts, apprentices, temporary workers, entrepreneurs and their spouses. The period during which a reduction of working hours can be authorized - which is currently 3 months - has been increased to 6 months, in order to reduce the number of requests and speed up the process.
To check your rights, you can consult the SECO website.
On April 23, the government improved the support to job-creating entrepreneurs and approved the proposal to supplement RHT up to the APG ceiling (CHF 5,880 .-). To apply to the cantonal employment office, you must fill in the form here.
SECO has simplified the request and today, the process consists of:
Update on 8 April 2020:
For more information on this subject: read the official report from the Federal Council
For more information on how to fill in the RHT request, you can consult the memorandum published by the FER which is based on a concrete example.
If the request is accepted by the competent cantonal authority, the employer must pay the allowance on the usual pay day and continue to pay all social charges. (For more details on this, check the brochure "Obligation to contribute to compensation in the event of RHT" published by the AVS / AI).
Each month the employer must assert his right by attaching the additional forms and documents requested by the unemployment fund. RHT allowances will then be paid to the employer.
For more details on RHT:
The measures relating to the right of necessity will end on August 31, 2020, at the end of the period of application of the COVID 19 unemployment insurance ordinance. Please note, the extraordinary right to RHT for people whose position is comparable to that of an employer, for their spouses or partners and for apprentices is deleted at the end of May 2020. The notice period of 10 days is also reintroduced (if RHT has already been approved, no new request to file, if the authorization should expire, it will be extended to a maximum of 6 months).
On June 11, a new memorandum on the request form and statement of compensation in the event of Covid-19 RHT was published by the FER.
-> On July 1, the Federal Council extended the possibility of using RHT to 18 months and fixed the waiting period at 1 day per counting period from September 1, from which the consideration of overtime prior to RHT will be also restored. This ordinance applies until December 31, 2021. Subject to the specifics mentioned, the usual RHT provisions will apply again from September 1.
If your company wishes to continue to benefit from RHT services from September 1, a new request must be made to the competent authority before August 22, 2020 to avoid an interruption in the compensation periods (notice periods of 10 days). The process must be repeated every 3 months and you need to justify in detail the reasons for the temporary loss of work (it is likely that the authorities will be stricter in examining the files).
The Social charges cantonal office (OCAS) is willing to be flexible towards its affiliates. If your company is having difficulty paying its dues, you can contact the OCAS to request a payment delay and the modification of your ordinary installments.
The Federal Council decided to temporarily allow employers to use, for the payment of employees' LPP contributions, the contribution reserves that they have built. The employer continues to deduct normally the share of contributions from the employees' salaries and the pension fund credits all contributions in favor of the latter.
Moreover, the obligation to advertise vacancies has been temporarily removed.
The obligation to advertise vacancies will be reactivated from June 6, 2020
Regarding the self-employed who have suffered a loss of income due to the related measures taken by the Federal Council and the employees who have had to interrupt their professional activity to take care of their children (up to 12 years) and who do not receive their salary accordingly, the extraordinary loss of earnings allowance can cover the compensation. For more information, visit the OCAS website.
Update on 16 April 2020:
The Federal Council has decided to extend the right to the COVID-19 loss of earnings allowance to self-employed persons indirectly affected by official measures. All independents professionals who declared an annual salary between CHF 10,000 .- and CHF 90,000 .- to the AVS will be compensated by the APG (at 80% of the salary declared to the AVS), retroactively, from 17 March 2020 at the earliest, for a maximum of 60 days (with a possible renewal). The request needs to be made via the online form of the compensation fund.
To find out more, discover the very complete BDO publication published on June 15, 2020: APG COVID 19 - helping the self-employed during the crisis.
=> On June 19, the Federal Council specified the deadlines relating to the right to allowance. The COVID-19 loss of earnings order is valid for six months, until September 16, 2020. No retroactive calculation can be filed after this date and all requests must be made before September 16.
On July 1, the Federal Council published a press release in which they asked people entering Switzerland from certain regions to quarantine 10 days. They specify that in this situation the right to loss of earnings allowance does not apply. In the event that a person goes into solitary confinement after having received an alert from the SwissCovid application, the right to loss of earnings allowance applies only if the quarantine has been ordered by a doctor.
FER has published this new table to easily understand who can get RHT or not, according to the new decisions of the Federal Council:
The OFAS confirmed that the occasional teleworking period linked to coronavirus does not change the status of the related cross-border workers.
At the end of April, the OFAS recalled: "With regard to teleworking for cross-border workers, we have not set a time limit on flexibility when the 25% of working time exercised in the state of domicile has exceeded because of Covid-19. We will continue to be flexible when someone is forced to work in their state of domicile because of Covid-19. "
If you have legal questions about teleworking, you can consult this article published by lexing.ch on its legal aspects.
An amicable agreement was signed on May 14 between Switzerland and France indicating that the tax agreements continue to apply as long as the exceptional measures are in force. Its effects will cease when the two States have ended their health regulations restricting or discouraging the movement of people.
Border controls with France, Austria and Germany will stop on June 15, 2020.
The Federal Council decided to put an end to the extraordinary situation from June 19 and to stop most of the measures against coronavirus from June 22, including the recommendation of remote working. The flexible application of the rules of liability to taxation applies until December 31, 2020 for Germany and until August 31, 2020 for France and Austria.
=> Modification of the installments of contributions, suspension of summons or suspension of payment of contributions, on April 28, PwC published an article on the financing of social insurance by the employer, explaining the regulatory requirements of the "Covid-19 Ordinance occupational pensions "and the OFAS directive.
The Fondation d’aides aux entreprises (FAE) supports companies hit hard by coronavirus by offering them a cash advance in the form of a direct loan, interest-free, without loan guarantee and in principle reimbursable over seven years.
To request a cash advance from the FAE click here.
Some banks provide liquidity in the form of rapid transitional credits and / or allow the suspension of variable:
On 13 April 2020, RTS highlighted some of the subtleties behind the credits guaranteed by the Confederation, including a 0% rate valid only for credits below CHF 500,000 .- and guaranteed only the first year, as well as credits granted in different ways depending on the banks (loans or extended authorized overdraft limit).
In the event that your company does not meet any of the criteria enabling it to be compensated by the RHT, the APG or a joint guarantee, Wilhelm Avocats highlights a solution based on the article 63 LEp.
Measures to prevent bankruptcies (update on 16 April 2020)
In order to prevent a wave of bankruptcies and to mitigate the consequences of the crisis, the Federal Council adopted an ordinance allowing a transitional exemption from the obligation to notify the judge in the event of immediate bankruptcy (for companies whose situation was healthy at the end of 2019) and implementing a COVID-19 limited report (3-month report which can be extended by an additional 3-month period) which could be required in a non-bureaucratic manner.
On April 30, in Geneva, the total or partial exemption from commercial rent for businesses was renewed for the month of May and extended to lease contracts of up to CHF 10,000 .- per month.
Clarifications from the Federal Council for foundations and associations during a pandemic (Covid-19): In response to a request from the umbrella association proFonds, the Federal Council confirmed that the measures to support businesses could also apply to foundations and associations. The Federal Council is thus taking a position on the applicability of RHTs, payment facilities for social security contributions and taxes / VAT and access to bridging loans. Relative information and other resources are available on the proFonds website.
Federal surveillance of foundations has announced that due to the coronavirus epidemic, the deadline for the submission of the annual report for 2019 is exceptionally extended to September 30, 2020, instead of June 30, 2020; it is not necessary to file an extension request. This exceptional extension does not concern previous annual management reports, including that of 2018.
It is wonderful to see that true solidarity has developed at all levels in our country. Many initiatives are emerging to give a boost to local businesses, including:
Depending on the sector of activity, some companies can resume on April 27 and others on May 11, provided that the activity-specific protection plan is put in place. Checks are already underway. To view the protection plan linked to your company, visit backtowork.easygov.swiss
You can also consult the fact sheet and the checklist for occupational health protection made available to employers by SECO.
As of June 6, measures to combat the coronavirus will be greatly relaxed. The Federal Council decided to no longer consider the situation as extraordinary within the meaning of the law on epidemics from June 19, 2020.
Should you continue or stop your activity? Do you need help filing your VAT statements as soon as possible or do you need administrative support in making requests to the authorities? Do you want to implement the best solutions?
Each business is unique. If you would like a loss analysis and personalized tips, please contact us.
As the situation is constantly evolving, we will update this article regularly so that you do not miss any measures that could have an impact on your business. Do not hesitate to follow our Linkedin page to stay informed with the latest updates.