Termination of employment contract: How to check your claims

An employment relationship can be terminated in various ways. Three of the reasons stated in the Swiss Code of Obligations (CO) are explained in more detail below. These are

• Expiry of a fixed-term contract
• Ordinary termination
• Termination without notice

The last two types of termination have a few things in common. For example, it is generally sufficient to give notice of termination verbally. The situation is different if the written form was agreed in the employment contract. In this case, the intention to terminate the employment relationship must be expressed in writing. This is recommended in any case for evidentiary purposes. The notice of termination is valid when the recipient has received it.

Fixed-term employment relationships

A fixed-term employment relationship is concluded from the outset for a specific duration. It ends at the end of the agreed period without the need for notice of termination. Ordinary notice of termination is generally not possible up to this point. The same applies to early termination unless there is good cause within the meaning of Article 337 CO.

However, the principle of contractual freedom that prevails in labour law makes it possible to agree deviating regulations. For example, if you have agreed a probationary period with your employer, the employment relationship can be terminated during this period. A notice period of seven days then applies. You can also stipulate the option of early termination with your employer in the employment contract in advance. This gives you and your employer the right to terminate the employment relationship before the fixed term expires. If no such agreements have been made, you can only terminate the contract by mutual agreement with your employer. This is usually done by means of a cancellation agreement. If employment is tacitly continued after expiry of the agreed term, the employment relationship is deemed to be permanent.

In practice, this means that the fixed term must be counted towards the total duration of the employment relationship. This in turn affects your entitlements - especially with regard to holiday periods and notice periods. Some employers try to circumvent these effects by stringing together several fixed-term employment contracts. However, if there is no objective reason, this is an abuse and it is likely to be reinterpreted as a permanent employment contract.

Ordinary termination

Labour law in Switzerland is characterised by a special feature: Unlike in other countries, the principle of freedom of termination applies here. This means that both parties can terminate the employment relationship without giving reasons - provided that they comply with the statutory notice periods and deadlines (Article 335 CO). These depend on how many years you have worked for the company.

The law stipulates a notice period of seven calendar days for the probationary period. Agreements to the contrary in written agreements, standard or collective labour agreements are permitted in accordance with Article 335b CO. The statutory notice period can be waived, shortened or extended. However, it is important that the notice of termination is received by the other party during the probationary period.

Once the probationary period is over, the notice period is staggered according to years of service. While it is one month in the first year of service, it is two months from the second to the ninth year of service. After that, the employment relationship can only be terminated with three months' notice (Article 335c CO). In each case, the end of the month is taken as the basis. Deviating agreements are also permitted here.

Your employer's freedom of dismissal is restricted if you enjoy protection against dismissal for a specific reason or for a specific period. This is the case, for example, if the dismissal is discriminatory under the Gender Equality Act (GEA) - Article 3 GEA - or abusive (Article 336 CO). Blocking periods due to incapacity for work, service, pregnancy or maternity also play an important role in this context. As the employee, you must present and prove the relevant facts.

With the exception of dismissal at an inopportune time, the notice of termination leads to the termination of the employment relationship after the notice period has expired. This applies even if it is an abusive dismissal.

Termination without notice

Termination without notice can only be considered if there is good cause. This is the case, for example, if the terminating party cannot reasonably be expected to continue the employment relationship (Article 337 CO). However, the law and case law place high demands on this unreasonableness. Whether a prior warning is dispensable depends on how serious the misconduct is. Serious misconduct entitles the employee to be dismissed without notice without prior warning. In addition to a general or repeated refusal to work and criminal offences in the workplace, this also includes the following misconduct:

• Acceptance of bribes
• Insults and assaults against work colleagues and superiors
• Competitive behaviour 
• Betrayal of business secrets

Excessive internet use, frequent telephone calls and a breach of the employer's instructions can also justify termination without notice. Less serious misdemeanours include, for example, a single, unjustified absence or arriving late at work. The circumstances of the individual case are decisive in each case. However, termination without notice is only permissible in such cases if the dismissal was preceded by a warning.

Furthermore, the allegations made must correspond to the facts. Mere suspicion is not sufficient. If they do not materialise, termination without notice is unjustified. However, this has no influence on the termination of the employment relationship. It ends with immediate effect - just like the justified termination without notice.

The termination of the employment relationship gives rise to a number of claims that you can assert against your employer. You have the right to:

1. Justification: If the employer terminates your employment, you can request a justification (Article 335, paragraph 2 CO). This statement is binding; it cannot be waived or changed (Article 361 CO). This is to ensure that you are able to recognise a possible case of abuse. The employer must inform you clearly and truthfully in writing of the reasons for termination within a period of one to two weeks (after termination).

2. Reference letter: Your employer is obliged to issue a reference letter at the latest when the employment relationship is terminated (Article 330a, paragraph 1 CO). This reference must provide information about both your performance and your behaviour. It must be formulated favourably and may only contain truthful information. If you do not wish to receive a reference, you can alternatively have a confirmation of employment issued (Article 330a, paragraph 2 CO).

3. Granting of time: Your employer is obliged to grant you time to look for a new job. It does not matter which party has given notice of termination. If you receive a monthly salary, you will generally also be paid for your absence. However, you must agree the time of your absence with your employer. About half a day per week is considered reasonable.

4. Monetary claims: The termination of an employment relationship triggers the maturity of all resulting claims (Article 339, paragraph 1 CO). All salary, holiday, compensation and overtime claims of the employee must be paid by the last day of the notice period at the latest. This also applies to any public holiday compensation, unless it is compensated by time off in lieu. These claims are subject to mandatory statutory provisions (Article 361 et seq. CO). In practice, this means that you may not waive these claims under any circumstances, even if your employer proposes a settlement that you would actually agree to. This regulation applies for the entire duration of the employment relationship until one month after its termination.

5. Information: Article 8 of the Federal Act on Data Protection (FADP) guarantees you an unconditional right to information about the content of your personnel file. Here you can find out what information your employer has collected about you. You may also receive documents that you need to assert a subsequent claim. To do this, however, you must first submit a request. Your employer may only refuse this under certain conditions.

6. Compensation: The termination of the employment relationship can trigger various claims for compensation. A typical example is abusive dismissal. If you can prove this, you can make a claim for up to six months' wages. However, the prerequisite for this is that you have asserted your claim in good time. You are also entitled to compensation in the following cases:

• in the event of justified termination without notice
• in the event of unlawful termination without notice by the employer
• in the event of termination without notice due to jeopardising your salary

To assert a claim, it is often sufficient to contact the other party in writing. Whether this is done by letter, e-mail or fax is irrelevant. However, it is important that the key points are clearly recognisable. Not only the claimant, but also the defendant must be named. The content of the claim must also be specified in terms of amount and sufficiently individualised.

If your employer does not respond, sometimes the only option is to go to court. A labour law lawyer can help you with this dispute. The expert will be able to realistically assess the justification for the dismissal. They will explain your rights to you, point out possible steps to clarify the matter and enforce your claims.

Deadlines for claims

Claims arising from the termination of an employment relationship are claims under civil law. They are therefore subject to the regular limitation periods of the Swiss Code of Obligations. These periods are mandatory and cannot be changed by contract or any other agreement. It is also not possible to waive them in advance. Accordingly, a limitation period of five years applies to salary claims - including bonuses, gratuities, profit-sharing and similar compensation. Your other claims, on the other hand, only become time-barred after ten years. Special time limits apply if you wish to take action against a cancellation. In such cases, you must submit your written objection by the end of the notice period. Otherwise the dismissal will be effective.

Severance pay and departure compensation

Your employer is only obliged to pay severance pay under certain conditions, which are regulated in Article 339b CO. Accordingly, you are only entitled to severance pay if you:

• are at least 50 years old and
• have worked for your employer for more than 20 years.

You are entitled to between two and eight months' salary. However, your employer may deduct from this any amounts that it has paid into your pension fund. The sum of these amounts is usually significantly higher than any severance pay. For this reason, severance pay plays a subordinate role in current practice. As a low earner, however, you can benefit from the regulation.

Severance pay must be distinguished from departure compensation. This is a voluntary payment by the employer that serves the purpose of amicable - usually immediate - settlement.

There are various situations in which you may lose all or at least some of your entitlements, for example if you give notice of termination yourself. In this case, you not only lose your protection against dismissal due to incapacity for work, but also your right to contest the dismissal as unfair. In addition, resigning yourself can lead to problems with unemployment insurance.

Two forfeiture periods apply to unfair dismissal. One of these is the aforementioned deadline for lodging an objection. The other applies in the event that no agreement is reached. According to Article 336b CO, you forfeit your claim if you do not lodge a complaint within 180 days of termination of the employment relationship.

Your claims may also be affected by a leave of absence, new employment, an unjustified failure to start work and leaving the job. A lawyer specialising in employment law will tell you where there may be pitfalls and what you need to look out for. GetYourLawyer will be happy to help you find a suitable specialist. As soon as you have described your concerns, you will receive up to three offers from suitable lawyers.

Article 336c CO provides you with special protection against dismissal during illness or following an accident after the end of the probationary period. In the first year of employment, your qualifying period is 30 days. This means that if you are on sick leave for a maximum of 30 days per year, your employer may not simply dismiss you if you can prove that you are genuinely unfit for work. The blocking period increases to 90 days from the second year of employment, and 180 days from the sixth year. 

Exceptions 

Work-related incapacity for work with a physical connection is exempt from protection against dismissal. Your employer may still be able to dismiss you if they can prove that you have been 'off work'. In legal terms, this is referred to as wilfully feigning incapacity for work. In fact, however, such behaviour usually only leads to a one-off warning and only in very serious cases to immediate dismissal. In which case the protection against dismissal is definitely limited are mass dismissals for purely economically necessary reasons. If you need help in asserting your rights, you can seek advice from a labour law attorney.