13th month salary in Switzerland: why "is it mandatory?" is the wrong question 2026 Guide

Is the 13th month salary mandatory in Switzerland?

Not by law, yes for three employees out of four. The Code of Obligations contains no provision imposing a 13th month salary: the federal legislator has never ruled on the number of instalments, only on the fact that salary is due. But stopping there means confusing "not imposed by federal law" with "optional". Three distinct mechanisms make the 13th salary mandatory, and together they cover most of the Swiss labour market.

Mechanism 1 — The collective labour agreement

This is the least known and the most binding source. On 1 July 2025, 83 extended collective agreements — meaning declared universally applicable by the Federal Council or by a canton — were in force in Switzerland. An extended agreement binds every employer in the sector concerned, including those who never joined an employers' association. According to Federal Statistical Office records as at 1 July 2024, roughly 1.1 million workers are covered by an extended agreement at federal or cantonal level.

Several of these agreements explicitly impose the 13th month salary:

In other words: a waiter, a temporary worker or a sheet metal worker does not have to negotiate a 13th salary. They are entitled to it, and their employer cannot go below it. The first thing to check is therefore not the contract but whether the sector is covered by an extended collective agreement.

Mechanism 2 — The individual contract and staff regulations

Outside collective agreements, the 13th salary falls under freedom of contract. It only needs to be set out in the employment contract, in staff regulations or in a service note to become due. Once agreed, it cannot be revoked unilaterally: removing it means amending the employment contract, which requires the employee's consent or a notice of amendment respecting the termination period.

Mechanism 3 — Conclusive conduct

This is the mechanism that catches the most employers out. A bonus paid three consecutive years without an express reservation turns into a mandatory salary component. The reservation must be stated — along the lines of "on an exceptional basis and with no commitment for the future" — and it must be real: a boilerplate reservation, repeated identically every year while the payment is in fact systematic, does not protect the employer. Three year-end bonus payments are therefore enough to create an acquired right, without any contract being signed.

13th salary, gratification, bonus: what sets them apart legally?

A single criterion decides: is the amount determined or objectively determinable in advance? If it is, the payment is salary under article 322 of the Code of Obligations. If the amount depends on the employer's discretion, it is a gratification under article 322d. The wording on the payslip carries no weight: a payment labelled "bonus" but fixed at one twelfth of the annual salary is a 13th month salary, and a payment labelled "13th salary" but left to management's discretion remains a gratification.

This distinction is anything but theoretical. It drives three practical consequences: the pro rata entitlement on departure, the employer's ability to pay nothing in a given year, and enforceability in court. The City of Lausanne summarises it in its note on gratifications, bonuses and the 13th salary, recalling that a gratification becomes due once it has been paid regularly and without reservation for at least three years.

The accessory principle, and the very high earners' limit

The Federal Supreme Court has set a safeguard: a gratification must remain accessory to the salary. It may only have secondary importance in the worker's remuneration. Where a bonus is very high compared with the annual salary — matching or exceeding it — and is paid regularly, it must exceptionally be treated as variable salary, even where the employer reserved its discretionary character. Otherwise it would be all too easy to pay CHF 3,000 of monthly salary and a CHF 100,000 discretionary annual "gratification".

That safeguard falls away for very high earners. The Federal Supreme Court considers that above five times the Swiss median salary, restricting freedom of contract is no longer justified: the bonus remains a gratification whatever its size and regularity. With a median salary of CHF 7,024 gross per month in 2024 according to the FSO, that threshold sits at around CHF 420,000 of annual remuneration. Above it, an employee has no acquired right to a bonus; below it, the accessory principle can work in their favour.

Why does a 13th month salary not increase your pay?

Because a 13th salary is not a thirteenth month of work: it is the same annual salary divided into thirteen parts instead of twelve. An employee paid CHF 6,000 over thirteen instalments and one paid CHF 6,500 over twelve both receive CHF 78,000 a year. They contribute on the same basis, pay the same annual tax, and build up the same occupational pension. Only the cash-flow schedule differs.

This equivalence is not a personal reading: it is written into Geneva cantonal law. Since 1 January 2026, the Geneva minimum wage has been set at CHF 24.59 per hour. But where an entitlement to a 13th salary exists, the accepted base hourly wage drops to CHF 22.70. Do the multiplication:

Two centimes apart over the year: the Geneva legislator deliberately built the two amounts to be equivalent. The canton therefore holds, as a matter of law, that a 13th salary rewards no additional work. It is hard to be clearer than that.

The practical consequence: compare offers on annual salary, never on instalments

This is where the real stake of the subject lies. An advert showing "CHF 6,500 × 13" offers CHF 84,500 a year. An advert showing "CHF 7,000 × 12" offers CHF 84,000. The first looks less generous at a monthly glance and is in fact the better one. Conversely, a candidate who negotiates the addition of a 13th salary without touching the monthly amount obtains a genuine 8.33% rise; one who accepts a move to thirteen instalments with the monthly figure cut accordingly gains nothing at all.

The rule is therefore simple and holds across the Swiss market: negotiate and compare on gross annual salary. Our guide to the average and median salary in Switzerland gives benchmarks by occupation and canton, and our guide to job opportunities in Switzerland details the ranges by sector — all expressed annually, precisely for this reason.

How is the 13th salary calculated when you leave mid-year?

The formula is the gross monthly salary multiplied by the number of months worked, divided by twelve. On an hourly or variable wage, the equivalent applies: 8.33% of the gross paid over the period. The result is identical, since one twelfth equals 8.3333%.

Is the pro rata really due? The two-step test

Everything depends on the qualification set out in section 2, and this is where it produces its most concrete effect.

If the 13th salary is salary, the pro rata is due as of right, including where the employee resigns. The logic is straightforward: the entitlement accrues month by month, exactly like ordinary salary. The Geneva building metalwork agreement puts it unambiguously, stating that entitlement to the 13th salary "arises from the first day of work with the employer". The hotel and restaurant national agreement provides for the same pro rata, with a single exception: termination during the probation period.

Where it is a discretionary gratification, article 322d paragraph 2 of the Code of Obligations is strict: the employee is entitled to a proportionate share on early departure only if this has been expressly agreed. Without a clause, nothing is due.

Is the "present on 31 December" clause valid?

This is the most frequent and most contested clause. It makes payment conditional on the employee being with the company on 31 December, or on no notice having been served by that date. Its validity turns on the same distinction: perfectly admissible for a gratification, it is far more fragile for a 13th salary qualified as salary, since it retroactively forfeits remuneration already accrued month by month. Where such a clause appears in a contract, it must at the very least be worded clearly and unambiguously to have any effect, and it remains open to challenge.

In practice, an employee who leaves mid-year and is refused any pro rata should check three points before accepting: the exact wording of the clause, the existence of an extended collective agreement covering the sector — which prevails over the contract — and the history of previous payments. Our guide on how to quit a job in Switzerland details what a final settlement contains, and our guide to dismissal and unemployment for cross-border workers covers the specific case of contract termination across the border.

What about sickness, accident or maternity leave?

The principle is that the 13th salary follows the salary. As long as the employer owes salary — during periods covered by article 324a of the Code of Obligations, by a loss-of-earnings insurance or by the maternity allowance — the 13th salary share keeps accruing. Conversely, a period of unpaid leave or a suspension of salary entitlement reduces the 13th salary proportionally. Collective agreements generally specify how absences are treated; the hotel and restaurant agreement, for instance, excludes irregular overtime and discretionary bonuses from the calculation.

What happens on the December payslip?

Nothing unusual on the social security side, a great deal on the withholding tax side. Few employees anticipate this asymmetry, and it explains almost every message along the lines of "my 13th was taxed at 40%".

Contributions: the 13th salary is salary like any other

The 13th month salary forms part of the AVS determining salary. It therefore bears exactly the same deductions as the other twelve instalments: AVS, AI and APG, unemployment insurance, occupational pension, accident insurance, and where applicable sickness loss-of-earnings insurance. No special rate, no exemption, no separate ceiling. Our guide to understanding your Swiss payslip breaks down each of those deductions line by line and how they split between employer and employee.

One point deserves flagging for employees and employers alike: the 13th salary must appear explicitly on the payslip and be reflected in the annual salary certificate. A 13th salary share that appears nowhere is a share that will not be counted the day a pension, an unemployment benefit or a reference income has to be calculated. Our guide to the Swiss salary certificate explains how to check it.

Withholding tax: two models, two December outcomes

This is where geography comes in. Since the reform that entered into force on 1 January 2021, circular 45 of the Federal Tax Administration provides for two calculation models, and each canton applies one or the other.

For cross-border workers, the dividing line follows that of taxation itself: those working in Geneva are taxed at source in Switzerland and fall under the annual model, whereas those in the eight cantons covered by the Franco-Swiss agreement of 11 April 1983 — Bern, Solothurn, Basel-Stadt, Basel-Landschaft, Vaud, Valais, Neuchâtel and Jura — are taxed in France on production of the tax residence certificate, and have no Swiss rate to watch. Our guide to cross-border worker taxes in Switzerland details that split canton by canton, and our guide to quasi-resident status explains when subsequent ordinary taxation becomes worthwhile.

Does the 13th salary count for pensions, unemployment and maternity?

Yes, in all five schemes, and this is the only place where it has a real effect on something other than cash flow. Because it forms part of the AVS determining salary, the 13th salary feeds into every calculation base built on that salary. Its presence or absence therefore changes amounts well beyond the month of December.

One last, widely overlooked effect concerns overtime. Several collective agreements expressly provide that the 25% supplement is calculated on the base salary increased by the 13th salary share: this is the case of the Staff Leasing agreement, which spells it out. An hour of overtime is therefore worth not 125% of the bare hourly rate, but 125% of the hourly rate increased by 8.33%. Our guide to cross-border overtime and the Swiss Labour Act details the thresholds and compensation methods.

Employers: should you introduce a 13th salary or raise the monthly salary?

At equal payroll, the two options cost exactly the same — same social charges, same tax burden, same employer cost. The choice therefore turns not on cost but on four parameters: attractiveness when hiring, cash flow, flexibility and legal risk.

The real risk for an SME is not the choice itself but the vagueness of the clause. Three recommendations apply to every Swiss contract. First, write down the calculation method, not just the principle: "one twelfth of the gross annual salary, paid with the December salary or pro rata on termination" leaves no room for interpretation. Second, if the intention is to keep a discretionary payment, do not call it a "13th salary" and attach an express and effective reservation to each payment — three years without one are enough to create an acquired right. Third, check whether an extended collective agreement covers the sector: it sets a floor from which the contract cannot depart.

For employers recruiting across the border, the question adds to an already long list: our employer checklist for hiring a cross-border worker and our guide to LPP employer obligations towards foreign workers cover the affiliation and reporting points that come with the first payslip.

How does this relate to the 13th AVS pension paid in December 2026?

Not at all, except for the date — and that is precisely what creates the confusion. December 2026 will be the first month in Swiss history in which a household can receive, in the same week, a 13th month salary from an employer and a 13th pension from the AVS. The two payments share neither their nature, nor their legal basis, nor their mandatory character.

According to the Federal Social Insurance Office, responsible for its implementation, the 13th AVS pension will be paid as a supplement to the old-age pension for December 2026, to everyone entitled to an old-age pension that month. Its amount corresponds to one twelfth of the total old-age pensions received during the year: child pensions, supplementary pensions and the pension supplement for women of the AVS 21 transitional generation are excluded from that sum. With a maximum old-age pension of CHF 2,520 per month in 2026, the 13th pension therefore reaches at most CHF 2,520. It does not count towards the income determining supplementary benefits, and it does not change monthly pension amounts. Our guide to the maximum AVS pension covers the amounts and the conditions for reaching it.

Cross-border workers: why is December the costliest month of the year to convert francs?

Because the exchange margin is a percentage, and in December the amount it applies to doubles. A cross-border worker converting salary every month bears a margin on CHF 6,500. In December, they bear it on CHF 13,000. The cost for the month is therefore mechanically multiplied by two, while the service rendered by the intermediary is exactly the same.

The orders of magnitude are known: a retail bank commonly applies a margin of 1.5% to 3% on a CHF to EUR transfer, often invisible because it is built into the displayed rate rather than billed separately. On a 13th month salary, that gives:

Scaled to a full year, the gap stops being anecdotal. A cross-border worker on CHF 6,500 over thirteen instalments repatriates CHF 84,500 a year. At a 2% margin, conversion costs them CHF 1,690. At 0.40%, it costs CHF 338. The difference, CHF 1,352 a year, far exceeds the net 13th salary they thought they had gained.

The ibani scale is degressive: 0.40% up to CHF 10,000, 0.35% from CHF 10,000 to 50,000, 0.30% from CHF 50,000 to 100,000, 0.20% from CHF 100,000 to 250,000, then 0.15% beyond. No account opening, account maintenance or transfer fees are added. You can estimate exactly what you would receive with our currency converter.

December's second pitfall: converting at a single day's rate

A cross-border worker paid monthly is unknowingly practising a form of smoothing: they convert twelve times a year, at twelve different rates, and effectively obtain an average. The 13th salary breaks that smoothing. Converted in one block on the day it lands, it is exposed to the rate of a single date — and December is not a neutral month on the currency markets, between year-end arbitrage and portfolio rebalancing.

The answer is not to speculate, but to take back the choice of timing. Receiving your salary on a personal Swiss IBAN lets you hold the francs until the rate suits, convert in several steps, or keep a franc reserve for the expenses that stay in francs — health insurance premiums, tax instalments, fuel or shopping on the Swiss side. Our guides on transferring your Swiss salary abroad and our CHF/EUR exchange rate forecasts set out the trade-offs by profile.

Frequently Asked Questions

Is the 13th month salary mandatory in Switzerland in 2026?

No article of the Swiss Code of Obligations imposes a 13th month salary: there is no general legal obligation. But it becomes mandatory through three other channels. First, the collective labour agreement: 83 extended collective agreements were in force on 1 July 2025 and around 1.1 million workers are covered by one. The national agreement for the hotel and restaurant industry provides in its article 12 for a 13th salary equal to 100% of one gross monthly salary, the Staff Leasing collective agreement sets it at 8.33%, and the Geneva building metalwork agreement at 8.33% of the gross annual salary, with entitlement acquired from the very first day of work. Second, the individual contract or the staff regulations, which make the 13th salary due as soon as it is agreed. Third, conclusive conduct: a bonus paid three consecutive years without an express reservation becomes a mandatory salary component. In practice, 75.9% of employees in Switzerland received a 13th month salary in 2024 according to the Swiss Earnings Structure Survey of the Federal Statistical Office, and 27.9% of companies pay none at all.

How do you calculate the pro rata 13th month salary when leaving mid-year?

The formula is the gross monthly salary multiplied by the number of months worked, divided by twelve. An employee on CHF 6,500 per month who leaves on 31 August is entitled to 6,500 × 8 ÷ 12, that is CHF 4,333.35 of 13th month salary, paid with the final salary rather than in December. On an hourly wage, the 13th month share is 8.33% of the gross paid, which gives the same result. This pro rata is due as of right when the 13th salary qualifies as salary under article 322 of the Code of Obligations, including where the employee resigns: the entitlement accrues month by month, exactly like ordinary salary. The position differs for a genuine discretionary bonus under article 322d, whose paragraph 2 states that the employee is entitled to a proportionate share on early departure only if this has been expressly agreed. That is why the legal qualification of the payment, and not its label on the payslip, decides what is owed. See our guide on how to quit a job in Switzerland.

Is the 13th month salary taxed more heavily than the monthly salary?

Not under ordinary taxation: the 13th month salary is simply added to annual income and carries the same rate as the rest. Under withholding tax, however, everything depends on the model applied by the canton, listed in the annex to circular 45 of the Federal Tax Administration. Five cantons apply the annual model — Fribourg, Geneva, Ticino, Vaud and Valais: there the determining income is annualised, the 13th salary is smoothed over the year and the December rate does not move. The other 21 cantons apply the monthly model: the 13th salary is attached to the month in which it is paid, and the rate applicable in December becomes that of an almost doubled monthly income, applied to the entire month. This is not a surcharge but an effect of the progressive scale. Because the monthly model provides no automatic annual correction, the only route to a refund is subsequent ordinary taxation or a rectification request, to be filed before 31 March of the following year. Paying the 13th salary in two instalments, in June and December, mechanically softens the effect.

Can an employer remove the 13th month salary?

No, where it is a 13th month salary in the strict sense, that is a salary component agreed in the contract, the staff regulations or a collective agreement. Removing it amounts to amending the employment contract, which requires the employee's consent or a notice of amendment respecting the termination period. An employer covered by an extended collective agreement cannot derogate from it downwards in any event. The answer differs for a bonus that has remained discretionary: the employer may vary the amount or pay nothing, provided an express and effective reservation accompanies each payment, along the lines of "on an exceptional basis and with no commitment for the future". Without that reservation, three consecutive years of payment are enough to turn the bonus into salary due. The principle of accessory nature sets a second limit: a bonus that reaches or exceeds the weight of the ordinary salary is reclassified as variable salary — except for very high earners, whom the Federal Supreme Court places above five times the Swiss median salary, that is around CHF 420,000 a year based on the median salary of CHF 7,024 recorded in 2024.

What is the difference between the 13th month salary and the 13th AVS pension paid in December 2026?

Everything separates them except the date. The 13th month salary is contractual, optional as far as federal law is concerned, paid by an employer to an employee, and subject to social security contributions like the rest of the salary. The 13th AVS pension is statutory, mandatory and automatic: it will be paid for the first time in December 2026 by the compensation offices, as a supplement to the December old-age pension, with no action required from the beneficiary. Its amount corresponds to one twelfth of the total old-age pensions received during the year, which gives a maximum of CHF 2,520 in 2026 since the maximum AVS pension is CHF 2,520 per month. Child pensions, supplementary pensions and the pension supplement for women of the AVS 21 transitional generation are excluded from that calculation. The 13th pension does not count towards the income determining supplementary benefits and does not change the monthly pension amounts. In practice, December 2026 will be the first month in which a household can receive both a 13th month salary and a 13th pension — and, if it lives outside Switzerland, convert twice as many francs as usual. See our guide to the maximum AVS pension.