Termination of employment: Employer's duty to provide information
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Irrespective of who has given notice of termination of employment, the employer must inform employees of their insurance coverage after the end of employment. This is governed by Art. 331 of the Swiss Code of Obligations. Paragraph 4 of this article states:
"The employer must furnish the employee with the necessary information regarding his rights and entitlements against a benefits scheme or an insurer."
According to the Federal Court's decision (BGE 4A_186/2010) of 3 June 2010, the employer's duty to provide information in the event of departure applies to the pension fund, accident insurance and the daily sickness benefits insurance. In the above-mentioned case before the Federal Court, the employee was not informed by the employer about the possibility of transferring voluntarily from the group daily benefits insurance to the individual daily benefits insurance. The employee fell ill and sued the employer for damages. The Federal Court awarded the employee damages because the employer had failed to comply with its duty to provide information. Depending on the case, the claim for damages can amount to up to 80% of two annual salaries. This shows how important it is to fulfil the duty to provide information for every employee who leaves the company, as well as for longer absences due to unpaid leave.
Employees who work more than eight hours per week are insured against the consequences of non-occupational accidents. After leaving the company, they remain insured with the previous accident insurer for 31 days.
If the employee does not immediately take up employment with a new employer or does not report to the unemployment office within 31 days, interim insurance can be taken out for non-occupational accidents. This is done with the previous accident insurer and is valid for a maximum of six months. It is important that the premium for the interim insurance is paid in by the employee before the expiry of the 31-day deadline for additional cover.
The interim insurance covers all benefit pursuant to the Accident Insurance Act (AIA), including daily benefits and disability pensions. Persons insured under an interim policy will continue to receive 80% of their previous salary from the third day onwards with a doctor's certificate. Of course, the claim for benefits must be reported immediately to the insurer. Employees who do not take out interim insurance must include accident insurance coverage in their private health insurance policy. However, basic insurance only covers the treatment costs.
If the employee is insured by the employer under a group daily benefits policy, the employee can in most cases transfer to individual daily benefits insurance and thus continue enjoying coverage for the continued payment of wages in the event of illness. The provisions of the insurance policy must be made known to the employee. The right of transfer is only mandatory in the case of unemployment in accordance with Art. 10 of the Unemployment Insurance Act.
Employees remain insured with the previous pension fund against the risks of death and disability for one month after leaving the company. Persons who do not have a new job / are not registered with the unemployment office must be informed about the various voluntary continued insurance options provided by the Substitute Occupational Benefit Institution. Any application documents for continued insurance must be received by the Substitute Occupational Benefit Institution no later than 90 days after the employee has left the current pension fund.
As the former employer, you must ensure that the vested benefits are transferred to the new employer's pension fund or to a vested benefits account. Send the relevant withdrawal form to the pension fund in good time. In most cases, they will contact the employee directly if they need any further information.
The obligation to provide information does not apply to the old age and survivors insurance (commonly known as AHV). This is because the AHV applies the same regulations for all, and there are no individual policies and framework conditions as for the UVG, KTG and BVG.
Nevertheless, we recommend that you inform leaving employees and those who take unpaid leave about the obligation of non-employed persons to pay contributions. AHV contribution gaps can be avoided by mentioning this in the information letter.
