Wage abuse cases rise in Switzerland

Swiss workers being undercut by poorly-paid foreign staff has been an issue for both sides in the building industry for years Keystone

One in ten Swiss firms without a collective bargaining agreement underpaid its workers in 2014, according to checks carried out by the State Secretariat for Economic Affairs (SECO) as part of accompanying measures for the free movement accord.

Last year SECO carried out investigations on labour and wage conditions at 8,900 Swiss firms which do not have collective wage agreements. It found that 10% of firms underpaid their workers based on minimum wage levels, an increase of two percentage points on 2013.

The main sectors affected were the manufacturing industry, hotels and restaurants, as well as private household services.

In firms with collective bargaining agreements, a single case of undercutting wage levels was reported in 29% of firms, compared with 25% in 2013, SECO said in its annual report.

Among foreign firms which send contract workers to Switzerland for fixed periods, SECO found that 28% of firms in sectors with obligatory collective bargaining agreements paid them below minimum wage levels, a 5% improvement on 2013.

SECO said in a statement on Tuesday that accompanying measures introduced under its free movement of people agreement with the European Union to protect workers from poor pay and working conditions were generally “targeted” and “efficient”.

Call for tougher sanctions

However, the Unia union criticised the findings, which it said confirmed figures it had also uncovered.

“This shows how urgent it is to act in order to better protect wages and labour conditions. If there are suspicions of undercutting wage levels, work should be able to be suspended, otherwise accompanying measures will never be dissuasive,” Unia said in a statement on Tuesday.

It added that additional measures, checks and tougher sanctions must be introduced in order to prevent such cases.

The free movement of workers has been allowed between Switzerland and the European Union since 2002 thanks to a bilateral accord.

Last September the government launched a consultation procedure to improve accompanying protection measures to the free movement of people accord. One of its main aims is to increase fines for firms that commit abuses, such as contravening minimum wage or work conditions, to up to CHF30,000 ($32,000). Previously this had been CHF5,000.

Another goal is to relax the conditions for extending collective bargaining agreements.