The coronavirus continues to have a firm grip on the Swiss economy. We would like to inform you about the latest developments:

• Assistance with short-time working compensation
• Hardship solutions for the self-employed
• Special guarantee schemes for SMEs

Assistance with short-time working compensation
Brochures
Seco has published a brochure on short-time working and there is also a detailed circular, which clarifies some questions.

Pre-registration
It is important to submit the pre-registration for short-time workinghttps://www.arbeit.swiss/dam/secoalv/de/dokumente/formulare/arbeitgeber/kae/716-300_d_V4.2-ausfuellbar.pdf.download.pdf/716-300_d_V4.2-ausfuellbar.pdfas soon as possible. Simplifications have been published in the canton of Bern. Not all questions have to be answered and the form Zustimmung zur Kurzarbeithttps://www.arbeit.swiss/dam/secoalv/de/dokumente/formulare/arbeitgeber/kae/716-315-d_ausfuellbar.pdf.download.pdf/716-315-d_ausfuellbar.pdf(Agreement to short-time working) does not have to be submitted. However, the employer must confirm in writing in the pre-registration that all employees affected by short-time working agree to the introduction of short-time working. The consent of all employees must be received no later than the date of the claim.

An extract from the commercial register does not have to be submitted. If the company has to declare short-time working as a result of the coronavirus, only three days’ notice may be given instead of the usual ten days. In order to speed up the procedure, the pre-registration in the canton of Bern can be sent to the e-mail rechtsdienst.ava(a)be.ch.

Financially, it makes sense if non-eligible owners continue to work and also take over work from entitled employees, so that the latter benefit from the short-time working compensation. Furthermore, we would like to point out that apprentices, pensioners and persons who have given or received notice of termination are not entitled to short-time working compensation.

Entitlement to the short-time working compensation only exists if recording of working hours at the company is carried out. The hours worked, including any apprenticeship hours, the hours lost for economic reasons and all other absences such as holidays, illness, accident or military service must be reported on a daily basis.

Claim
If the cantonal office issues a positive decision on the introduction of short-time working, the company is entitled to claim short-time working compensation. Short-time working compensation must be claimed within three months after the end of the month affected by short-time working at the unemployment insurance fund selected in the pre-registration (even if no decision has yet been made by the cantonal office or if an appeal or court proceedings are pending). Claims filed late will not be paid.
The following forms must be submitted in order to make a claim

• Application for short-time working compensation
• Accounting for short-time working (Excel)

Instructions for Excel can be found here. Additional forms must be submitted for seasonal lost hours and interim earnings.

Payment
The employer pays the wage at the normal time, whereby 100% of the hours actually worked and 80% of the lost hours must be paid. If claimed, the unemployment insurance fund will reimburse the company 80% of the wage in arrears. It is important to note that social security deductions are always made on the wage that would be paid out without the short-time working.

If an employee takes holidays during short-time working, these may not be deducted from the short-time working. The same applies to compensation for illness, accident or maternity.

Hardship solutions for the self-employed
The situation of self-employed persons is currently unclear, as they do not benefit from short-time working compensation. Likewise, owners of legal entities are not eligible. The situation is aggravated by the fact that the short-time working compensation only partially covers the wage costs of employees, but not other costs such as rent. The Federal Council has therefore instructed the financial administration to examine a hardship solution. For the time being, the Federal Council wants to make around one billion francs available for this purpose. It is intended as emergency aid to bridge the liquidity gap for companies and also for self-employed persons. The Federal Council wants to prevent a wave of bankruptcies and to safeguard jobs. It wants to support people who have no entitlement to short-time working or daily allowances quickly and without bureaucracy. However, the processes are still being worked out and we hope for communication by next Friday.

Special guarantee schemes for SMEs during the corona crisis
In Switzerland, there are three recognised regional guarantee organisations and one nationally recognised guarantee organisation for women:

• BG Mitte, guarantee cooperative for SMEs, https://www.bgm-ccc.ch
• BG OST-SÜD, guarantee cooperative for SMEs, http://www.bgost.ch/
• SAFFA guarantee cooperative for women, http://www.saffa.ch/
• Cautionnement romand (Bürgschaft Westschweiz)), https://www.cautionnementromand.ch

These organisations guarantee repayable loans of up to 1 million francs. The Swiss government guarantees 65% of their risk of loss. The guarantee organisations bear 35% of the risk of loss themselves.

On 13 March 2020, the Federal Council decided to provide for an increase of 10 million francs in the contribution to administrative costs, limited until the end of 2020. With these funds, fundamentally healthy companies in coronavirus-related liquidity bottlenecks can receive a guarantee with immediate effect:

• The Swiss government will reimburse the guarantee organisations for the entire application examination fees. This means that SMEs do not incur any costs when submitting an application.
• The Swiss government reimburses the guarantee organisations for the risk premiums of 1.25% of the guaranteed amount for the year 2020 for new guarantees, as well as for existing guarantees that have to be adjusted as a result of the effects of the coronavirus.

The application process is very formalistic and usually takes about three weeks. However, in exceptional situations such as those currently prevailing, we expect it to take considerably longer. Before an application can be submitted, a loan must be negotiated with a financial institution. Only then do you submit an application to one of the guarantee cooperatives. At least the following documents are required for this application:

• Budget for the next few years
• Articles of association and composition of the shareholders
• Annual accounts for the last three to five years
• Current extract from the commercial register
• Current extract from the debt collection register
• Financial figures for the current business year

More information can be found at https://kmu-buergschaften.ch/en/.

If you have any questions or need assistance with any of the individual points, please do not hesitate to contact us.

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