What is short-time work? What liquidity support is available to companies? What can be done in the event of loss of earnings due to childcare or quarantine? Find out here what is currently important.
The ongoing coronavirus pandemic not only threatens our health but also the global economy and our social life. Uncertainty about where this journey will lead us – and how long it will last – is fueling the fear for one's existence. To cushion the initial shock and to ensure the stability of the Swiss economy, the Federal Council and the cantons have put together a comprehensive aid package. Below, we highlight some aspects that are also relevant to the recruitment industry.
Short-Time Work
To secure jobs, companies can apply for short-time work in times of crisis. We have answered important questions about this topic.
What? One speaks of short-time work if the contractually regulated working time is temporarily reduced by at least 10% or completely suspended. More info here.
Who? The employer applies for short-time work at the responsible cantonal office and pays the short-time allowance to the employee in addition to the reduced wage.
How much? The short-time allowance compensates 80% of the lost salary. The assessment basis (monthly salary) is capped at CHF 12,350. Numerical examples can be found here.
For how long? The approval period has been extended from 3 to 6 months. In total, a company can apply for short-time work for a maximum of 12 months (if necessary, with an extension to 18 months by the government).
Temporary adjustments due to the Corona crisis:
– Among others, employees with fixed-term contracts and temporary staff posted through an organization are now eligible for short-time allowance
– Employers no longer have to pay a deductible (elimination of the waiting period)
– Employees do not have to pay for existing overtime
– Simplified registration process
– Further adjustments are listed here
Liquiditiy Support
Holds true, especially in times of crisis: cash is king! Despite the short-time work compensation, many companies are facing liquidity shortages. The measures taken by the federal government and the cantons serve to secure ongoing liquidity needs in order to protect generally solvent companies from financial difficulties.
What? Bridging loans as immediate aid for SMEs (sole proprietorships, partnerships, legal entities with a turnover of up to CHF 500 million).
Who? Companies that have been seriously affected by the Corona crisis but are not in bankruptcy or composition proceedings.
How much? Affected companies receive up to 10% of their turnover (maximum CHF 20 million) as a bank loan. Loans of up to CHF 500'000 are paid out immediately and are fully guaranteed by the government (interest rate 0%). Higher amounts require a more comprehensive examination; they are secured by the government at 85% and by the bank at 15% (interest rate 0.5%). The credit period is 5 years.
Among others, further temporary cost reductions due to the Corona crisis include:
– Social security: Contributions (AHV/IV/EO/ALV) can be temporarily deferred interest-free if necessary
– Pension provision: Employers may temporarily use their employer reserves to pay BVG contributions
– Taxes: No default interest on late payments of certain taxes, on customs duties and steering taxes
– More information regarding the cost reductions can be found here.
Additional links:
Bridging loan application (We strongly recommend to obtain information from your local bank, as well.)
Here is a helpful checklist of what should be done now.
Compensation for Loss of Earnings
In addition to the measures for short-time work and liquidity support, extended benefits targeted at loss of earnings are available.
New compensation for loss of earnings:
– Parents who have to look after their children due to the closure of day-care centers/schools (employees and self-employed persons)
– People in quarantine
– Self-employed (including freelance artists)
Additional links:
Application for the Corona compensation for loss of earnings
Do you have further questions or concerns regarding business and Corona? We look forward to hearing from you at any time – via email, phone or social media!
We hope everyone is getting through this crisis, stick together and stay healthy!
Your Coopers Team
Oh... and stay tuned: Tomorrow, we'll publish an interview with Managing Director Christian Biedermann on how the recruiting industry is affected by the coronavirus pandemic and how Coopers is dealing with it.
Photo by Amelie & Niklas Ohlrogge on Unsplash.
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