SWITZERLAND Law and Practice Contributed by: Philippe Nordmann, Irène Suter-Sieber, Jonas Knechtli and Gustaf Heintz, Walder Wyss
7.3 Dismissal for (Serious) Cause Dismissal for Serious Cause
of an agreed fixed term (minus any savings and a replacement income resulting therefrom) and to an additional penalty payment of up to six month’s salary. (No) Formalities to Be Observed With regard to the (absence of) formalities to be observed, the explanations in connection with ordi - nary terminations (see 7.2 Notice Periods ) principally apply mutatis mutandis. The only (rather theoretical) difference is that dismissal for serious cause may arguably not even be declared subject to the obser - vation of contractually agreed formalities. Swiss employment law principally allows for the con - clusion of termination agreements, but there are strict limits on the parties’ freedom of contract. Most impor - tantly, termination agreements may not be concluded in order to circumvent statutory provisions protecting employees’ interests (in particular, mandatory provi - sions in connection with incapacities for work due to illness or accident – see 7.5 Protected Catego- ries of Employee ); but must rather constitute actual settlements in which the employer also makes con - cessions. In most cases, one of the very purposes for concluding a termination agreement is to obtain clarity with regard to the termination date by exclud - ing any prolongation of the employment in connec - tion with an employee’s incapacity for work, so the parties regularly agree on an additional “voluntary” employer’s payment to compensate the employee for such concession. Another popular motive for such an additional employer’s payment is to compensate for the impending consequences of an abusive termina - tion (see 8.1 Wrongful Dismissal ). Reflection Period 7.4 Termination Agreements Permissibility and Requirements Pursuant to (controversial) case law, the conclusion of a termination agreement initiated by the employ - er requires the employee to be granted a sufficient reflection period. There are no other specific proce - dures or formalities to be observed when concluding termination agreements.
Either party may at all times terminate an employ - ment with immediate effect. While the law declares that dismissal for serious cause must be subject to the existence of good cause, even dismissal for seri - ous cause without good cause results in an immediate termination of the employment. The (non-)existence of good cause therefore only determines the further legal consequences of dismissal for serious cause. The party declaring dismissal for serious cause must state its respective reasons in writing if the other party Good cause is assumed if the party declaring dis - missal for serious cause may not reasonably be expected to continue the employment until the expiry of the applicable notice period or the agreed fixed term. While the competent court has a large margin of discretion when assessing this requirement and will consider all circumstances of the particular case, it is well established that good cause may only be affirmed in exceptional and particularly severe cases. Also, in order not to forfeit the right to dismissal for serious cause, it is necessary for the dismissal to be declared within a few days (usually two to three working days) of becoming aware of the relevant (good) cause. Consequences of Dismissal for Serious Cause As already explained, a dismissal for serious cause results in the immediate termination of the employ - ment. so requests. Good Cause In the most practically relevant scenario, where the employer issues dismissal for serious cause due to an employee’s (alleged) breach of contract, the fol - lowing applies: • if the employer exceptionally succeeds in proving good cause, the employee loses any claims aris - ing from the employment that have not yet been earned (in particular future salary payments) and becomes liable to pay damages to the employer; or • if the employer fails in proving good cause, the employee is entitled to what they would have earned if the employment had been terminated observing the applicable notice period or by expiry
642 CHAMBERS.COM
Powered by FlippingBook