Bern, 20.05.2020 – At its meeting on May 20, 2020, the Federal Council decided to set up additional funding of CHF 14.2 billion for unemployment insurance and to gradually abandon the measures in this area taken in conjunction with COVID 19. The abandonment of these measures will occur at the rate of the gradual recovery of the economy.
The number of notices of reduced work hours has jumped since mid-March 2020 and has since stabilized. To date, some 190,000 companies have claimed compensation for reduced working hours for around 1.94 million workers, which corresponds to approximately 37% of the volume of employment in Switzerland.
This situation has resulted in a considerable debt in unemployment insurance in a very short time. Without the rapid implementation of additional financing, this social insurance will present debts estimated at more than 16 billion francs at the end of 2020. The debt brake set by law would be triggered. Unemployment insurance would then be required to revise the law for financial stabilization and increase employee contributions by at least 0.3 percentage points in 2021 already. The Federal Council intends to avoid this in the current difficult situation and to guarantee that the unemployment insurance system will always be able to play its role as economic stabilizer. This is why it is planned that the Confederation will bear the cost of compensation in the event of a reduction in the working hours for the current year. Parliament will be subject to an extraordinary additional credit of 14.2 billion francs for this purpose.
On May 20, 2020, the Federal Council also considered the gradual abandonment of measures taken in connection with COVID-19 which aimed at mitigating the negative repercussions for workers of the prohibitions and orders issued by the authorities in the framework of the extraordinary situation defined in the law on epidemics.
These measures helped maintain jobs, preserve incomes and secure payments to the businesses concerned quickly and without complications. They have also reduced the administrative burden of the cantonal unemployment insurance executive bodies.
The measures adopted as part of the orders of necessity will be gradually phased out following the steps of relaxing the restrictions to allow the economy to restart.
- The extraordinary right to the reduction of the working hours for the people who occupy a position comparable to that of an employer and for the spouses or registered partners of these people, occupied in the company, will be canceled at the end of the month of May 2020, at the same time as the measures taken in connection with COVID-19 to mitigate the loss of earnings of the self-employed directly or indirectly affected.
- The right to a reduction in working hours will be abolished simultaneously for apprentices, the aim being that they can continue their training as quickly as possible.
- Finally, the notice period will be reintroduced. It had been removed because the restrictions imposed on businesses were not predictable. However, the measures of the Federal Council are now known, and the consequences for businesses are easier to estimate. They therefore have the possibility of respecting the deadline before announcing a notice. Companies that have already been approved for the reduction of the work schedule should not resubmit this change.
The other measures relating to the right of necessity will end as planned on August 31, 2020, at the end of the period of application of the COVID-19 unemployment insurance ordinance. Companies still have the option of using the short-time working tool in the fight against the coronavirus, in order to preserve jobs.
Address for sending questions
DEFR Communication
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Author
Federal Council
https://www.admin.ch/gov/fr/accueil.html
Federal Department of Economics, Education and Research
http://www.wbf.admin.ch
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