– October 24, 2022

Staff leasing: Who is my employer?

Both personnel leasing and private employment agencies are regulated by the Employment Agencies Act (AVG), which is intended to protect jobseekers and leased employees.

What is personnel leasing?

If an employee works in a company other than the one he or she is employed in under an employment contract, this is personnel leasing. The employment contract is between the employee and the hiring company. The lender and the enterprise where the employee works conclude a contract of hire or an assignment agreement. By doing so, the lender cedes the rights to give instructions to the employee to the company where the employee works.


The types of personnel leasing

  • Temporary work
    Temporary work is when an employer hires employees without exception so that he can lend them out to other companies. The employer does not own a production or service company, so he has no need for the employees himself. In addition, a separate employment contract is drawn up and concluded for each assignment of the employees.
  • Labour leasing
    In the case of labour leasing, employees are hired out so that they can be lent to companies, but the employers themselves usually also have their own company in which the workers can be deployed. The employment contract is concluded for a certain period of time, but this period is independent of the individual assignments.
  • Occasional hiring out
    In the area of occasional hiring out, workers are not employed so that they can be hired out to other enterprises. However, there may be exceptional cases where the worker is needed in another enterprise, for example, to bridge turnover shortfalls in one’s own enterprise or to provide assistance to an enterprise that is literally flooded with work. This type of personnel leasing does not require a permit.
  • Intra-group hiring
    Intra-group hiring out is subject to authorisation. A permit may only be waived in individual cases, namely if the purpose of the loan is only to acquire experience in technical, linguistic or other respects, or if the expertise is to be passed on within the company.
  • Commercial hiring out of personnel
    Commercial hiring out of personnell is considered to be commercial if it is carried out regularly and for profit.

    In this context, regular means that within twelve months at least ten contracts are concluded with individual employees or a group of employees or that an annual turnover of at least CHF 100,000 is generated through the hiring out of personnel.

    If the invoicing to the employing company exceeds the amount for wage costs, ancillary wage costs and an administrative cost share of max. 5%, the personnel leasing is profit-oriented.

    If the personnel leasing is commercial, a cantonal permit is required within Switzerland. This is issued by the canton where the placement or leasing company is based. In order to ensure that wage claims can be met, the hiring company must deposit a security of CHF 50,000 – CHF 150,000 with the canton.

Cross-border personnel leasing

In the case of cross-border personnel leasing, a federal permit must be obtained. This is issued by SECO, the supervisory authority over the cantonal enforcement authorities.

Before an employee may be hired out abroad, it must first be checked whether the company has sufficient knowledge of the conditions in the country in question.

However, the hiring out of personnel from abroad to Switzerland by a foreign hiring company is not permitted under Art. 12 para. 2 AVG.

Measures for unauthorised personnel leasing

Anyone who intentionally arranges work or hires out personnel without the necessary licence is liable to a fine of up to CHF 100,000 under Art. 39 para. 1 lit. a AVG. 

Pursuant to Art. 39, para. 2 AVG, a fine of up to CHF 40,000 is imposed on any person who, as an employer, uses the services of an intermediary or lender and knows that he or she does not have the required licence. Anyone who intentionally violates the obligations to report and provide information is also liable to a fine of up to CHF 40,000.