SWITZERLAND Law and Practice Contributed by: Philippe Nordmann, Marion Bähler, Dario Glauser, Christian Hagen and Samuel Lieberherr, Walder Wyss Ltd
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 relevance when it comes to determining the mutual rights and obligations in connection with a particular employment relationship. These are typically the following (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 con - tracts (as the case may be); • non-mandatory statutory law (including perti - nent 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 prin - ciple 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 explicitly or
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 damages caused intentionally or negligently by default of their duties. The lia - bility 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 man - ner does not lead to liability, even if, in retro- spect, 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 indirect damages, such as by a dimin - ished share value) and, in the event of its bank - ruptcy only, the company’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 obligations. Under the “piercing of the corpo - rate veil” concept, shareholders can, in excep - tional 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.
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