Swiss Federal Council releases work permit quotas for 2018: increased quotas for non-EU/EFTA nationals - Tax Blog

Swiss Federal Council releases work permit quotas for 2018 increased quotas for non-EUEFTA nationals

On 29 September 2017, the Swiss Federal Council announced an increase of 500 work permit quotas for non-EU/EFTA nationals for the year 2018. The quota for EU/EFTA nationals on assignment (no Swiss employment contract) will increase by 1’000 for L permits and by 250 for B permits in 2018.

As of 1 January 2018, the quotas are therefore the following:

  • 4'500 L permits for non-EU/EFTA nationals
  • 3'500 B permits for non-EU/EFTA nationals
  • 3'000 L permits for EU/EFTA nationals
  • 500 B permits for EU/EFTA nationals

Current impact

For non-EU/EFTA nationals all work permits with a duration of more than 4 months/120 days are subject to quota. The available quotas are partially distributed at the beginning of the year to the cantons according to their economic need and partially retained as a reserve with the federal authorities. The Federal Council informed that the additional 500 quotas issued in 2018 will be allocated to the federal reserve.

EU/EFTA nationals working in Switzerland on assignment (with no Swiss employment contract) for more than 4 months/120 days are not covered by the Agreement on the Free Movement of Persons and are also subject to quota. The quotas will be increased by 1000 L quotas and 250 B quotas for 2018. The Federal Council will issue a total of 3’500 quotas (500 for B permits and 3’000 for L permits). These quotas are released quarterly and are not distributed to the cantons.

Deloitte’s view

Since 2015 we have experienced a shortage in quotas and it has therefore become increasingly challenging to obtain approval for work permits. The quarterly released quotas for EU/EFTA nationals usually have been exhausted within 6 to 8 weeks.

For non-EU/EFTA nationals, the federal authorities have already distributed their B-permit quota reserve to the cantons and several cantons announced that they will have issued all their B permit quotas for 2017 soon. Due to the critical quota situation, the authorities have become stricter in reviewing work permit applications and have in most cases only issued quota relevant work permits for highly qualified employees.

According to the available quotas for 2018 a similar practice from the authorities for the next year can be expected. The moderate increase of the quotas for non-EU/EFTA nationals will bring a much-welcomed relief to the exacerbated quota situation.

Our recommendations

  • Organisations should strategically consider what their current employment needs are and whether there are local resources available in Switzerland who can perform the work.
  • As EU/EFTA work permits for local hires are not subject to the quotas, where possible, companies may try to offer local Swiss employment contracts.
  • For senior/strategic roles that need to be filled by assignee's, it may be worth planning the start date at the beginning of the quarter to increase the chances to obtain a quota for EU/EFTA nationals.
  • If the quotas have been reached, it may be possible to request 120-day work permits and file an extension application for a longer term work permit approximately one month prior to the release of the new quota.

What should you do going forward?

The immigration authorities have tightened application practices – for example closer scrutiny of applications, increased salary requirements (wage equalisation), and stricter extension rules. The authorities are also assessing applications in more detail and are responding with additional questions or a refusal but with the right to be heard (this trend has been already recognised).

These measures have made obtaining work permits slightly more difficult, but getting a Swiss work permit is still possible for those who meet the conditions or work in a shortage industry. 

In order to mitigate this issue, organisations should ensure that they:

  • First check resources available within the Swiss labour market before filling the position with an assignee.
  • Adopt a forward-looking staffing/work permit application plan in order to avoid delays, as the authorities will treat applications according to the first received, first processed principle.
  • Draft application letters carefully focusing on clear explanations and evidence of applicants' skills and their link to the planned activities in Switzerland.
  • Respect the minimum salary requirements imposed by the Swiss authorities (Swiss peer-level salaries and additional payments/allowances for housing/meals). 
Renaat_Blog

Renaat Van den Eeckhaut – Partner, Global Employer Services Leader Switzerland and EMEA

Renaat leads the Global Employer Services (GES) Practice for Deloitte Switzerland and EMEA. He specialises in international assignment and cross-border employment matters and advises on tax, social security and international mobility policies. Renaat has nearly 20 years of experience with Deloitte Belgium and Switzerland and has worked with many companies across a broad range of industries. Renaat holds a Master in Law and Accounting Law and has authored many publications on international taxation.

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Julia Stutzer - Senior Manager, Immigration

Julia is an Immigration Senior Manager at Deloitte in Switzerland. She has 5 years of experience in supporting both global companies as well as medium and small sized enterprises with their immigrations needs.

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Timo Heck - Senior Manager, Immigration

Timo is an Immigration Senior Manager at Deloitte in Switzerland. He advises both domestic and international, listed and private companies on all aspects of Swiss immigration and has deep experience in implementing client-tailored complex immigration processes as well as advising on best-practices to accommodate the specific needs of his clients.

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