Parliamentary committee backs ban on federal severance payments

Severance payments for top executives in the federal administration and government-linked companies should no longer be allowed, SRF reports. Following the Council of States, the National Council’s State Policy Committee has also backed the change.

The committee voted 21-0, with four abstentions, to recommend approving the proposal, Parliamentary Services said on Friday. The full National Council is expected to consider it during the autumn session, where approval would likely be a formality.

The committee said the current rules had led to abuses and that retaining them was no longer justified. The proposal was initiated by former independent Schaffhausen Council of States member Thomas Minder.

Severance payments are currently possible following dismissals involving senior executives in the federal administration. They are intended to make it easier to end employment when separating from an employee is necessary. Severance payments can also be agreed by contract with members of the boards of directors and executive boards of government-linked companies.

Under the proposed rules, such payments and agreements would no longer be permitted, including as part of a simplified dismissal. Exceptions would remain possible, for example when the affected person was not responsible for the dismissal and it was required because of a reorganisation.

Finance Minister Karin Keller-Sutter unsuccessfully opposed the ban in the Council of States. She said the federal government, as an employer, needed to be able to use severance payments depending on the circumstances. Without that option, the government would have to consider alternatives, such as immediately releasing employees from their duties while continuing to pay their salaries.