We are pleased to announce the release of our latest Global Workforce publication, which examines the best practice approach to Global Employment Companies (GECs) and the impact of the directive issued on 20 June 2017 by the Swiss Office of Economic Affairs (SECO) on the treatment of intragroup loan staffing arrangements in Switzerland.
GECs are typically companies that centrally hire employees for purposes of loaning them to group affiliates. The publication covers how the use of GECs has evolved over time, the main considerations for determining if a GEC is the right option and whether an alternative deployment or service delivery model may be more suitable. It also examines the question “to GEC or not to GEC?” and details some of the key GEC success factors, as well as actions existing GECs should consider in light of the worldwide corporate governance and responsible tax debate.
A full copy of the publication is available here.
Some of the topics addressed in the publication include:
- Reasons for setting up GECs and typical GEC locations
- Key questions to consider when deciding to use a deployment or service delivery model as an alternative to a GEC
- Best practices for setting up GECs and for existing GECs
- Important considerations for establishing a GEC in Switzerland
Switzerland traditionally has benefited from legislation that flavors the incorporation of GECs and is home to a number of such service companies. This, however, could change in the future due to the revised government guidance in the aforementioned directive issued by the SECO. Under the directive, secondments of staff by non-Swiss GECs into Switzerland are deemed to be unacceptable loan staffing arrangements. In addition, Swiss-based GECs now may be required to register for loan staffing permits to continue operating.
Since SECO directives are applied by the cantonal authorities, companies should verify the local consequences of the directive before making any changes to current loan staffing structures.
If you are interested in this topic, please contact Per Melberg for further information.