HR compliance in Switzerland for a new business is comparatively straightforward at the federal level — but the cantonal layer, present in nearly every step of the process, is where companies new to Switzerland most often discover gaps after the fact rather than before. A clear sequence of confirmations before the first hire removes most of that risk.
This checklist sets out what a new business needs to confirm before and immediately after its first Swiss hire, covering:
- Entity, director, and registration prerequisites specific to Switzerland
- The cantonal variables that apply regardless of company size
- BVG/LPP and withholding tax setup before the first payroll run
- Ongoing obligations tied to Switzerland's annual cantonal calendar
Confirm entity structure and the Swiss-resident director requirement before registration. A GmbH requires CHF 20,000 in fully paid-in capital and at least one Swiss-resident director or managing director with signing authority; an AG requires CHF 100,000 (CHF 50,000 paid in) with equivalent residency requirements for board representation. Non-resident founders typically satisfy this through a local fiduciary director while retaining full ownership — but this appointment must be confirmed before commercial register filing, not arranged afterward.
Register with the cantonal AHV/AVS compensation office before the first payroll run. This is a canton-specific registration, not a single national one, and must be completed before any employee's first payslip is issued. AHV/IV/EO contributions total 10.6% of gross salary, split equally between employer and employee, with no upper cap.
Confirm BVG/LPP pension fund affiliation for any employee above the entry threshold. Once an employee's annual salary exceeds CHF 22,680, occupational pension affiliation becomes mandatory, with contributions calculated on the "coordinated salary" at a rate that rises with age roughly every five years. This affiliation should be confirmed before the relevant employee's first payroll cycle, not retrofitted once the threshold is noticed retroactively.
Verify cantonal withholding tax (Quellensteuer) obligations for any employee without a C permit. Withholding tables are set independently by each canton and revised every January; a company hiring across multiple cantons is managing a distinct withholding calculation per canton, not one uniform national calculation. New entrants should confirm which table applies to each employee's specific canton of residence or work before the first payroll run, and build a process for updating these tables every January going forward.
Identify any cross-border (frontalieri) employees early. Border cantons — Ticino, Geneva, and Basel among them — apply a separate bilateral withholding mechanism for cross-border workers, calculated on a distinct basis from standard Quellensteuer. This should be flagged at the hiring stage, not discovered during year-end reconciliation.
Check for an applicable collective labour agreement (CLA) and any cantonal minimum wage. Switzerland has no federal minimum wage, but several cantons set their own minimum, and CLAs — common in construction, hospitality, and other sectors — frequently set sector-specific minimums above any cantonal floor. New entrants should not assume the absence of a federal minimum means no minimum applies.
Build awareness of statutory notice periods and absolute protected periods before any termination becomes necessary. Notice periods scale by tenure under the Code of Obligations (seven days during probation, rising to three months from the tenth year); termination during illness, accident, or maternity-related protected periods is void, not merely contestable, regardless of the employer's stated reason.
A financial services firm establishing its first Swiss presence in Zug initially built its hiring checklist assuming a single national social security and tax process, based on the company's experience in other European markets with centralised systems. When the firm's second hire was based in a different canton for operational reasons, the existing checklist had no provision for re-verifying withholding tables or BVG coordination thresholds against the new canton's specific parameters. HTLC's review ahead of that second hire identified the gap before any payroll was run, allowing the correct cantonal configuration to be built in from the outset rather than corrected after an initial payroll cycle using the wrong canton's table.
The Switzerland-specific risk in this checklist is less about any single requirement being unusually complex and more about the cantonal layer repeating itself at every step — registration, withholding, and in some cases minimum wage all vary by canton, even when the federal framework underneath stays uniform. Companies expanding beyond a single canton should revisit this checklist for each new canton specifically, not assume the first canton's setup transfers automatically. Talk to an HR expert to review your setup against this checklist before your first Swiss hire, or before expanding into an additional canton.