The Swiss Federal Supreme Court, in a decision dated 12 August 2024 (BGer 8C_75/2024) ruled on the question of insurance coverage for individuals who live abroad but telework for a Swiss company. These employees are generally not insured under the company's compulsory accident insurance policy and the Accident Insurance Act (AIA).
An individual, living overseas, was employed by a Swiss-based company as a “product content manager”’ on a fixed-term contract. His work mainly involved platform work, which could be carried out for the Swiss company regardless of the employee’s location. The employee was not a Swiss resident either at the time of hiring or during the employment period; instead, he lived temporarily in different jurisdictions around the world. While in Sri Lanka, he was hit by a delivery van as a pedestrian and suffered severe traumatic brain injuries.
The Swiss insurance company initially recognised its obligation to pay benefits as the responsible accident insurer and paid benefits for medical treatment and a daily allowance. After a few months, following further investigations, the Swiss insurance company issued a decision denying its obligation to pay benefits. The insurance company stated that the employee was not subject to the Swiss Federal Law on Accident Insurance (UVG) because "he had not been employed in Switzerland."
The Federal Court examined whether "an employment in Switzerland" existed in the narrow sense of the regulation in question. The AIA stipulates that all employees who are employed in Switzerland are covered by mandatory accident insurance. Because the legal text does not elaborate on this further, the court conducted a systematic, teleological, and historical interpretation of the regulation.
The court concluded that, under the circumstances, "employment in Switzerland" had to be understood by applying the principle of territoriality. In summary, the court held that the employee was not posted by the Swiss employer, but it had employed him abroad from the outset in the broader sense of this determination. Consequently, the employee had never worked in Switzerland before the accident (which would be an integral condition to confirm an assignment), and it was not sufficiently likely that he would continue to be employed in Switzerland.
With this decision, the court made a strong argument that it is not sufficient for the work result to have been achieved in Switzerland (nor is a working contract with a Swiss-based employer crucial) for it to be assumed that the work was carried out in Switzerland. Rather, the actual performance of the work in Switzerland within an undefined period during the term of employment is a mandatory requirement.
This ruling is a warning signal to all employers based in Switzerland that employ platform employees who can carry out their work from anywhere. As a result of this ruling, the contractual guarantee of accident benefits urgently needs to be conditioned.
Dejan Milosevic
Janine Bienz
BDO in Switzerland
Facts of the Case
An individual, living overseas, was employed by a Swiss-based company as a “product content manager”’ on a fixed-term contract. His work mainly involved platform work, which could be carried out for the Swiss company regardless of the employee’s location. The employee was not a Swiss resident either at the time of hiring or during the employment period; instead, he lived temporarily in different jurisdictions around the world. While in Sri Lanka, he was hit by a delivery van as a pedestrian and suffered severe traumatic brain injuries.The Swiss insurance company initially recognised its obligation to pay benefits as the responsible accident insurer and paid benefits for medical treatment and a daily allowance. After a few months, following further investigations, the Swiss insurance company issued a decision denying its obligation to pay benefits. The insurance company stated that the employee was not subject to the Swiss Federal Law on Accident Insurance (UVG) because "he had not been employed in Switzerland."
The Federal Court examined whether "an employment in Switzerland" existed in the narrow sense of the regulation in question. The AIA stipulates that all employees who are employed in Switzerland are covered by mandatory accident insurance. Because the legal text does not elaborate on this further, the court conducted a systematic, teleological, and historical interpretation of the regulation.
The court concluded that, under the circumstances, "employment in Switzerland" had to be understood by applying the principle of territoriality. In summary, the court held that the employee was not posted by the Swiss employer, but it had employed him abroad from the outset in the broader sense of this determination. Consequently, the employee had never worked in Switzerland before the accident (which would be an integral condition to confirm an assignment), and it was not sufficiently likely that he would continue to be employed in Switzerland.
With this decision, the court made a strong argument that it is not sufficient for the work result to have been achieved in Switzerland (nor is a working contract with a Swiss-based employer crucial) for it to be assumed that the work was carried out in Switzerland. Rather, the actual performance of the work in Switzerland within an undefined period during the term of employment is a mandatory requirement.
This ruling is a warning signal to all employers based in Switzerland that employ platform employees who can carry out their work from anywhere. As a result of this ruling, the contractual guarantee of accident benefits urgently needs to be conditioned.
Dejan Milosevic
Janine Bienz
BDO in Switzerland