Best Employment Benefits & Executive Compensation Lawyers in Dornach

About Employment Benefits & Executive Compensation Law in Dornach, Switzerland

Dornach is a municipality in the Canton of Solothurn. Employment benefits and executive compensation in Dornach are governed primarily by Swiss federal law, complemented by cantonal tax rules and local administrative practices. Most rules that matter to employees and employers are set by the Swiss Code of Obligations, the Labour Act, and social insurance statutes. Executive pay in listed companies is further shaped by corporate governance rules that require shareholder oversight. Although individual contracts and company policies play a large role, they must respect mandatory protections, social insurance minimums, and data protection duties.

Typical topics include base pay, the 13th-month salary, variable bonuses, equity awards such as options and RSUs, pension plans in the second pillar, accident and sickness coverage, parental allowances, non-compete undertakings, and termination terms such as garden leave and post-termination restraints. Because Dornach sits within the Basel economic area, cross-border and mobile executive issues are common, including source tax, social security coordination, and treatment of long-term incentive plans across jurisdictions.

Why You May Need a Lawyer

Employees and executives often seek legal advice when negotiating an employment agreement or executive service contract that includes variable pay, short-term incentive and long-term incentive plans, change-in-control provisions, or non-compete and non-solicit obligations. Legal help is also important when assessing whether a bonus is discretionary or a contractual entitlement, how equity awards are taxed and subject to social security, and how garden leave affects vesting and post-termination restrictions. If termination is on the horizon, counsel can evaluate abusive dismissal claims, social plan rights in large restructurings, and the timing or clawback of incentives.

Employers seek counsel to design compliant compensation structures, draft clear bonus and equity plan rules, manage works council or employee representation where required, run mass layoff consultations, align compensation governance with shareholder voting for listed groups, and implement data protection processes for HR. Cross-border hiring, secondments, and remote work also trigger advice on source tax, social security coverage, and mobile employee equity taxation. Early legal input reduces disputes and helps align incentives with Swiss rules.

Local Laws Overview

Employment contracts and pay are governed by the Swiss Code of Obligations. Parties have flexibility, but mandatory provisions apply to salary continuation during illness, holiday pay, notice periods, and protections against abusive dismissal. A 13th-month salary is common but only due if agreed by contract, policy, or collective agreement. The legal characterization of bonuses is fact-specific. If variable pay is tied to performance and constitutes an essential part of total compensation, it may be treated as salary and become enforceable. For very high earners, purely discretionary gratuities may remain non-claimable. Clear plan language and consistent practice are critical.

Working time and overtime are regulated by the Labour Act. Maximum weekly hours are typically 45 hours for office, industrial, and technical staff and 50 hours for others. Extra hours under the Code of Obligations and overtime under the Labour Act are distinct concepts. Overtime under the Labour Act generally attracts a 25 percent premium unless compensated by time off and subject to specific thresholds and exceptions. Senior managers who genuinely direct the business may be exempt from some working time rules, but this is a narrow category and requires a functional assessment.

Social insurance is split into three pillars. The first pillar covers old age, survivors, and disability through AHV-AVS and IV-AI. The second pillar occupational benefit plan under the BVG-LPP is mandatory for employees above a defined salary threshold. Employers must affiliate with a pension fund and pay at least the legally required contributions. Executive top-up plans are possible within legal limits. Accident insurance under the UVG-LAA is mandatory. Employers cover occupational accidents for all employees and non-occupational accidents for employees working at least 8 hours per week. Many employers purchase daily sickness benefits insurance to finance statutory salary continuation during illness.

Family-related benefits include maternity allowance for 14 weeks, paternity allowance for 2 weeks, adoption allowance for 2 weeks for adopting parents of a child under a specified age, and carer leave entitlements for seriously ill children and for short-term care needs. These allowances are funded under the loss of earnings scheme and coordinated with employment law rights to time off.

Executive compensation in listed companies is governed by Swiss corporate law reforms that embed the former ordinance against excessive compensation. Shareholders vote on board and executive pay, companies publish a compensation report, and certain payments such as severance, advance compensation, and success fees are prohibited for listed issuers. For non-listed companies, freedom of contract applies subject to employment and corporate law boundaries. Equity incentives should be documented in plan rules and award agreements that clearly describe vesting, malus and clawback, leaver definitions, and treatment on termination or change-in-control.

Taxation and social security treatment of incentives depend on the instrument. Non-tradable options are generally taxed at exercise. RSUs are typically taxed at vesting. Restricted shares are taxed at grant with a discount for restrictions. Social security contributions usually apply in parallel. Employers must operate source tax for employees who are not taxed by ordinary assessment, including many permit holders and cross-border commuters. The Canton of Solothurn applies its own tax tariffs and municipal multipliers. Coordination of taxation for cross-border commuters is influenced by double tax treaties, with practical payroll obligations resting on the Dornach employer.

Non-compete clauses are allowed but must protect a legitimate business interest, be reasonable in duration, geography, and scope, and usually cannot exceed 3 years. Enforceability increases if the employer provides consideration and the employee had access to sensitive information or client relationships. Courts may reduce overly broad restraints. Garden leave is a common tool to keep an employee out of the market during notice while preserving pay and benefits according to contract terms.

Reductions in force and mass layoffs trigger specific procedures. If an employer contemplates a mass layoff, it must consult employees and notify authorities. Companies with at least 250 employees that plan to dismiss at least 30 employees within 30 days are generally required to negotiate a social plan with employee representatives or staff.

Data protection applies to HR processing. The revised Swiss Federal Act on Data Protection requires transparency, purpose limitation, data minimization, and appropriate security. Employees have access rights. Employers should provide clear HR privacy notices, apply retention schedules, and manage cross-border data transfers carefully, especially for global equity plan administration.

Dornach specific points relate mainly to administration. The Solothurn social insurance agency handles AHV-AVS affiliation and employer registrations. The cantonal tax office oversees source tax and individual returns. Local practices also matter for staff representation in companies that meet thresholds under the Participation Act, which provides for information and consultation rights in larger workplaces.

Frequently Asked Questions

Is a 13th-month salary mandatory in Dornach

No. A 13th-month salary is customary in Switzerland but only payable if agreed in the contract, a company policy, or a collective bargaining agreement. If paid consistently as part of remuneration, it may become an acquired right and should not be unilaterally withdrawn.

When does a bonus become legally enforceable

If a bonus is essential to total compensation or calculated based on objective criteria, it often qualifies as salary and becomes claimable. For very high earners, a purely discretionary bonus may be treated as a gratuity and not legally enforceable. The exact outcome depends on the contract, plan rules, communications, and past practice.

How are stock options and RSUs taxed in Switzerland

Non-tradable options are generally taxed as income at exercise on the spread. RSUs are typically taxed as income at vesting. Restricted shares are taxed at grant with a discount for the restriction period. Social security contributions usually apply. Residents pay tax through their return, while employees subject to source tax have payroll withholding. Exact outcomes depend on plan terms, mobility history, and cantonal practice.

Can my employer claw back or reduce variable pay

Yes if the plan rules or contract clearly provide for malus or clawback and the mechanism is proportionate and transparent. Clawbacks must respect Swiss employment law, good faith, and data protection. For listed companies, governance rules and shareholder approvals may also apply.

What happens to my equity awards during garden leave

This depends on the plan. Many plans treat garden leave as continued employment, so time-based vesting continues, but performance conditions and termination classifications control final outcomes. Read the leaver provisions and any change-in-control rules. Seek legal advice before agreeing to garden leave if vesting is at stake.

How is overtime treated for office staff

For most office and technical staff the maximum weekly time under the Labour Act is 45 hours. Overtime under the Labour Act is usually paid with a 25 percent premium unless compensated with time off and subject to exceptions and thresholds. Contractual extra hours under the Code of Obligations may be handled differently. Senior managers can be exempt from certain rules if they truly direct the business.

What are my rights to salary during illness

If you are unable to work through no fault of your own and the employment has lasted long enough, the employer must continue salary for a limited period according to case law scales unless daily sickness benefits insurance applies. Many employers insure this risk and pay benefits via the insurer. Contract terms and local practice determine the exact duration.

Are non-compete clauses enforceable after I leave

They are enforceable if they protect legitimate interests, are reasonable in time, geography, and activity, and the employee had access to sensitive information or key clients. Three years is usually the upper limit. Courts can reduce overly broad restraints. Consideration and careful drafting improve enforceability.

Do cross-border commuters to Dornach face special tax rules

Yes. Source tax often applies for non-resident or certain permit-holding employees. Double tax treaties with neighboring countries allocate taxing rights and provide relief. Employers in Dornach must withhold source tax where required and may need to apportion equity income for mobile executives. Personal circumstances and residence determine the final tax position.

Are severance payments allowed for executives

For listed companies, severance and certain extraordinary payments are prohibited by corporate governance rules and shareholder oversight. For non-listed companies, severance is generally permitted but is taxable and must respect employment law. Legacy preferential tax regimes for severance have largely been abolished. Careful drafting is essential to avoid reclassification of severance as unpaid salary or unlawful consideration.

Additional Resources

State Secretariat for Economic Affairs SECO for employment standards, Solothurn Social Insurance Institution SVA for AHV-AVS employer registration and contributions, Solothurn Cantonal Tax Office for source tax and assessments, Suva and private accident insurers for UVG-LAA, Federal Social Insurance Office for family allowances and loss of earnings scheme, Occupational Pension Supervisory Commission OAK BV for second pillar oversight, Swiss Bar Association and Solothurn Bar Association for lawyer referrals, Federal Data Protection and Information Commissioner for HR data guidance, Amt fuer Wirtschaft und Arbeit Solothurn for labor market administration, SIX Exchange Regulation and corporate governance materials for listed issuers.

Next Steps

Identify your objectives. Clarify whether you need to negotiate a new package, resolve a dispute over an existing plan, or plan for a restructure or exit. Note any deadlines. For abusive dismissal claims you must protest in writing before the end of the notice period and bring any damages claim within 180 days after the employment ends.

Collect documents. Gather your employment contract, amendments, bonus letters, equity plan and award agreements, company handbooks, board or compensation committee resolutions, payslips, and correspondence. Assemble any mobility history that affects tax and social security.

Assess tax and social security. List where you worked during each vesting period and request plan tax summaries from your employer. Confirm source tax status in Solothurn and any treaty relief for cross-border work.

Check data and confidentiality. Review HR privacy notices, consent forms for equity plan administration, and confidentiality clauses. Prepare any data access or correction requests if needed.

Seek legal advice early. Contact a lawyer who handles employment benefits and executive compensation in the Solothurn region. Ask for a review of your contractual rights, plan terms, enforceability of restraints, and tax or social security exposure. For listed company executives, ensure compliance with corporate governance rules and disclosure duties.

Document agreements. Ensure any negotiated changes are recorded in signed contract amendments or plan addenda. Align plan rules with payroll, social insurance registrations, and corporate approvals. Keep copies of all documents for your records.

Follow through on filings. If you are subject to source tax confirm correct tariffs with payroll. If you file a return in Solothurn keep evidence of equity income allocation and supporting schedules. Coordinate with the pension fund and insurers when employment ends or benefits change.