The EU is seeking to redefine responsibility for paying unemployment benefits to cross‑border workers.
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A planned reform of unemployment insurance rules for European Union cross‑border workers could prove costly for Switzerland. According to estimates by the State Secretariat for Economic Affairs (SECO), the change could result in additional annual costs of between CHF600 million and CHF900 million ($771 million-CHF1.1 billion).
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The EU is seeking to redefine responsibility for paying unemployment benefits to cross‑border workers. Under the proposed reform, it would no longer be the state of residence that pays benefits, but the state where the worker was last employed before becoming unemployed.
SECO published the estimates on its website on Thursday, figures first reported by the Neue Zürcher Zeitung (NZZ). The secretariat cautioned that the calculations are subject to considerable uncertainty, as Switzerland has limited data on unemployed cross‑border workers. A more precise estimate will only be possible once the final version of the revised EU regulation is known.
Swiss approval required
Before the regulation can enter into force, it must be approved by both the EU Council of member states and the European Parliament. An EU diplomat said last week that a favourable outcome was expected.
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Because the regulation falls under the EU–Switzerland agreement on the free movement of persons, the revision would also apply to Switzerland. Should it be adopted, the European Commission would formally notify Bern via the relevant joint committee. Implementation would require Switzerland’s explicit consent, SECO said.
Current system benefits Switzerland
Under the current system, Switzerland reimburses unemployment benefits paid by the country of residence of a cross‑border worker who loses their job. Last year, reimbursements to France, Germany, Austria and Italy totalled CHF283.3 million, according to SECO.
By contrast, unemployment insurance contributions paid in Switzerland by cross‑border workers generate around CHF600 million in annual revenue, leaving Switzerland with a surplus of roughly CHF300 million under the existing arrangement.
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If the reform were to enter into force, however, that balance would be reversed. SECO estimates that Switzerland would instead face an annual deficit of between CHF300 million and CHF600 million.
Additional administrative burden
The reform could also increase administrative demands on Switzerland. As the paying authority, the federal government would be responsible for overseeing unemployed cross‑border workers.
“If Switzerland covers the benefits, we will also have to provide staff for the regional employment offices,” Jérôme Cosandey, head of SECO’s labour directorate, told Swiss public broadcaster RTS. “We would need to support unemployed people directly, and that would change the workload,” he said.
Adapted from French by AI/sb
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