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The question of whether an employee remains in the Swiss social security system during an assignment abroad or has to be insured in the destination country is one of the central aspects of every international assignment. This is because not only the obligation to pay contributions depends on this, but also the specific entitlement to benefits in the event of illness, accident or disability.
In this article, we take a look at the three most important case groups:
- International assignments to EU and EFTA states
- International assignments to countries with bilateral social security agreements
- International assignments to non-contracting states
1. International assignments to EU and EFTA states
For assignments in EU or EFTA states, the rules of the Agreement on the Free Movement of Persons (AFMP) apply. The aim is to avoid double insurance and to enable seamless continued insurance in the Swiss social security system.
If the requirements are met, the competent AHV compensation fund issues a so-called A1 certificate. This confirms that the employee continues to be subject to Swiss social security law during the assignment abroad and not to the system of the country of assignment.
Conditions for an international assignment with an A1 certificate:
- International assignment from Switzerland to an EU or EFTA member state
- EU or EFTA nationality of the employee
- Previously subject to Swiss social security
- Ongoing employment relationship with the Swiss employer
- Limited assignment for a maximum of 24 months
- No replacement of an employee who has already been assigned
Important for practice:
The areas of international assignments to EU and EFTA states must always be considered separately. For example, under the AFMP, EU citizens cannot be assigned from Switzerland to an EFTA state - and EFTA nationals cannot be posted from Switzerland to an EU state. In these cases, the respective bilateral social security agreement, if any, would then apply.
2. International assignments to countries with bilateral social security agreements
Switzerland has concluded bilateral social security agreements with numerous countries, e.g. with the U.S., Canada, Australia, Japan, India, Brazil and South Korea, to name just a few. The aim is to ensure that the Swiss insurance obligation continues to apply and to avoid double social security contributions.
Typical features of such agreements:
- They usually only cover individual branches of social security - above all old-age and survivors' insurance (AHV/IV).
- Other social security branches are by no means always covered, so that double insurance or double contribution payments may occur depending on local regulations.
- The maximum international assignment period is defined differently depending on the agreement.
- A formal application via the Swiss compensation office is also required here.
Important for practice:
Even if many agreements appear similar at first glance, they can differ considerably in detail. It is worth checking the respective effects of the applicable social security agreement for the employee at an early stage (i.e. ideally before concluding the international assignment agreement).
3. International assignments to non-contracting states
For international assignments to countries with which Switzerland has not concluded a bilateral social security agreement, no international regulations apply to avoid double social security contributions in Switzerland and abroad.
From a Swiss perspective, assigned workers can continue to be insured with the AHV (old-age pension scheme) and unemployment insurance (ALV), provided they were insured in Switzerland for at least five consecutive years immediately prior to the international assignment.
The application must be submitted by the employer to the relevant AHV compensation fund in good time.
The other Swiss social security branches can be continued in part (for a limited period). There may also be an additional insurance obligation abroad.
Important for practice:
Without early and careful planning, insurance gaps may arise or contributions may be paid twice. It is, therefore, advisable to check the specific social security situation and take appropriate measures before international assignment to a non-contracting state.
Conclusion
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
