Kompass Europa proposes permanent levy on foreign hires

Swiss alliance Kompass Europa wants employers that recruit workers abroad to pay a progressive immigration levy at all times, a proposal that would conflict with Switzerland’s agreement on free movement with the EU, SRF reports.

The proposal goes further than a measure under discussion in parliament as part of a new package of agreements with the EU. A majority in the Council of States wants employers to pay at least 4,000 francs a year for each foreign worker, but only if Switzerland activates a safeguard clause in response to serious problems with immigration.

Kompass Europa co-founder Alfred Gantner says the costs of immigration are borne by the public. He estimates that 80,000 people move to Switzerland each year, requiring the country to build schools, roads, hospitals and sanitation facilities. The alliance proposes that employers recruiting workers from abroad pay the levy for the first five years, with the rate rising according to salary.

For lower-paid jobs, the levy would be 1% of gross salary. The rate would increase for annual salaries above 50,000 francs, reaching a maximum of 15% for salaries over 300,000 francs. Gantner says an employer hiring someone in a hotel job near the minimum wage would pay about 500 francs a year, while the levy on a Zurich investment banker could reach 60,000 francs. The measure could raise an estimated 1.35 billion francs annually, which Gantner says should be distributed directly to Swiss households.

Kompass Europa says the levy would encourage employers to hire locally and could reduce immigration by a quarter, from 80,000 to 60,000 people a year. The alliance accepts that its proposal would breach the free-movement agreement, which is linked to other bilateral agreements. Gantner says Switzerland needs a plan B because public support for free movement may not last.

Daniel Kopp, central secretary of the Swiss Trade Union Federation, says such a levy would end the bilateral agreements and put Switzerland’s partnership with Europe at risk. He also says similar measures in other countries have led to more undeclared work, precarious jobs, downward pressure on wages and bureaucracy.

The Swiss Employers’ Association also opposes the proposal. Its chief economist, Patrick Chuard-Keller, says immigration brings substantial benefits to Switzerland and that the levy would particularly burden the recruitment of highly qualified workers. He warns that making such recruitment more expensive would harm Switzerland’s economy and could lead companies to consider moving abroad.

The proposal is unlikely to gain support at present. It may be intended as a starting point for discussion if Switzerland rejects the Bilaterals III package and reconsiders its relationship with Europe.