Undeclared Work

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Combating Undeclared Work: Understanding to Better Protect Yourself

Undeclared work (working "off the books") is not a "trick" to save money; it is a practice that weakens our social system and exposes both employers and employees to serious legal and financial consequences.

💡 What is Undeclared Work?

Undeclared work consists of engaging in gainful activity without complying with current legal obligations, notably:
* Failure to register with social security (AHV/AVS, IV/AI, EO/APG, ALV/AC).
* Non-compliance with tax obligations.
* Failure to apply for a work permit for foreign nationals.

⚠️ The Risks: Why Avoid It?

For the Employee: Invisible Precariousness

  • Lack of insurance coverage: In the event of a workplace accident, you risk not being covered.
  • Pension gaps: Periods worked off the books do not count toward your retirement (AHV/LPP). This significantly reduces your future pensions.
  • No legal protection: In the event of a dispute with the employer or non-payment of salary, you have virtually no legal recourse.
  • Loss of rights: No unemployment benefits, family allowances, or maternity benefits linked to this income.

For the Employer: Heavy Sanctions

  • Fines and criminal penalties: Fines can reach tens of thousands of francs.
  • Retroactive payment of contributions: The employer must pay all unpaid social security contributions (both employer AND employee shares) for several years.
  • Exclusion from public procurement: Faulty companies may be barred from bidding for government contracts.
  • Civil liability: If an employee is seriously injured, the employer may be required to pay health costs and lifelong disability pensions out of pocket.

✅ The Benefits of Declared Work: A Contract of Trust

  1. Social Security: Protection in the event of illness, accident, unemployment, and maternity.
  2. Economic Justice: Guarantee of receiving the agreed salary and benefiting from paid holidays.
  3. Solidarity: Contribution to the funding of public services (schools, roads, hospitals) that we all benefit from.
  4. Peace of Mind: Working and hiring legally avoids the stress of inspections and reports.

Found someone? Here’s how to do things by the book

  • Register with your canton’s AHV/AVS compensation office from the very first franc of salary. The CHF 2,500 exemption does not apply to private households. Sole exception: young people up to age 25 who earn no more than CHF 750 per year from you.
  • Take out accident insurance (UVG/LAA). It is mandatory from the first hour. From 8 hours per week in your household, it also covers accidents outside work.
  • Up to CHF 22,680 of salary per year per person, the simplified accounting procedure settles AHV/AVS, unemployment insurance, and tax in one go. AHV/IV/EO and unemployment contributions are 6.4% for the employee and 6.4% for the employer.
  • Prefer not to handle it yourself? An employment cheque service (for example Chèque service in Geneva) or an online tool like Clino prepares the contract, payslips, and statements for you.

⚖️ Legal Framework and Resources

Undeclared work is subject to strict laws to ensure fair competition between companies and the protection of workers.

Reference Texts

Useful Links for Information