SWITZERLAND Law and Practice Contributed by: Philippe Nordmann, Marion Bähler, Christian Hagen, Samuel Lieberherr and Dario Glauser, Walder Wyss Ltd
ture. The following are non-transferable, inalienable duties that may not be delegated: • the overall management of the company and the issuing of all necessary directives; • determination of the company’s organisation; • the organisation of the accounting, financial control and financial planning systems as required for the management of the company; • the appointment and dismissal of persons entrust - ed with managing and representing the company; • overall supervision of the persons entrusted with managing the company, in particular with regard to compliance with the law, articles of association, operational regulations and directives; • compilation of the annual report, preparation for the general meeting and implementation of its resolutions; • filing an application for a debt restructuring mora - torium and notification of the court in the event that the company is overindebted; and • in the case of companies whose shares are listed on a stock exchange, the preparation of the remu - neration report. 3.5 Directors’, Officers’ and Shareholders’ Liability In general, members of the board of directors and the executive management are personally responsible to the company, its shareholders and creditors for dam - ages caused intentionally or negligently by default of their duties. The liability is, however, excluded if a task was properly delegated and if due care was given in selecting, instructing and supervising the person(s) put in charge of the relevant task. Under the business judgement rule, a business decision taken in a proper, unbiased and reasonably informed manner does not lead to liability, even if, in retrospect, it becomes clear that such decision was materially wrong and to the detriment of the company. Liability actions can be brought by the company, its shareholders (either directly if they suffered direct damage or on behalf of the company in case of indi - rect damages, such as by a diminished share value) and, in the event of its bankruptcy only, the compa - ny’s creditors. However, formal actions against board members are not common in practice.
Once shareholders have fully paid in their shares, they are not personally liable for the company′s obliga - tions. Under the “piercing of the corporate veil” con - cept, shareholders can, in exceptional cases, be held liable if the legal separation between the shareholder and the company has been disregarded and it would be abusive to rely on the legal independence of the company. 4. Employment Law 4.1 Nature of Applicable Regulations Nature and Hierarchy of the Legal Rules Governing Employment Relationships There are various sources of law that may be of rel - evance when it comes to determining the mutual rights and obligations in connection with a particular employment relationship. These are typically the fol - lowing (listed in hierarchical order): • mandatory statutory law (including pertinent case law); • mandatory standard employment contracts – ie, a special kind of legislative decree (as the case may be); • collective bargaining agreements (as the case may be); • operating regulations (as the case may be); • employment contract; • regulations of the employer (if any); • non-mandatory standard employment contracts (as the case may be); • non-mandatory statutory law (including pertinent case law); • instructions of the employer (if any); and • judge-made law based on the hypothetical will of reasonable contracting parties (in the absence of any other applicable legal source). 4.2 Characteristics of Employment Contracts Principle of Freedom of Form Principle Swiss employment law is governed by the principle of freedom of form, meaning that there are, as a matter of principle, no formal requirements for the conclusion of an employment contract. Therefore, the conclusion of an employment contract generally only requires
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