Parental leave in the Swiss system
Switzerland introduced paid maternity leave in 2005 and paternity leave in 2021, positioning itself among the last European countries to do so. Despite this late start, the current system offers solid protection financed through income compensation allowances (IC/EO/APG), a branch of the 1st pillar social insurance.
Maternity and paternity allowances are funded by IC contributions (included in the OASI/DI/IC contributions that every employee and employer pays monthly) and are paid out by the compensation fund. They do not directly burden the employer, although many collective agreements provide a salary top-up at the company's expense.
This guide covers all practical aspects: duration and conditions of leave, IC allowance calculation, taxation of allowances, tax planning for new parents, accounting obligations for employers and specifics for the self-employed.
Maternity leave: 14 weeks
Maternity leave is governed by the Income Compensation Act (LIPG) and the Code of Obligations (CO Art. 329f). Here are the key points:
Duration: 14 weeks (98 days)
Leave begins on the day of birth and lasts 14 weeks (98 calendar days, not working days). The 8 weeks following birth constitute a mandatory work prohibition under Art. 35a of the Labour Act — the mother cannot work even if she wishes to. From week 9 to 14, leave is optional but compensated.
Eligibility conditions
The mother is entitled to the allowance if: she was compulsorily insured under OASI for 9 months before the birth, worked at least 5 months during pregnancy and at the time of birth is an employee, self-employed or works in the spouse's business receiving a cash salary. Unemployed women receiving LADI benefits are also entitled.
Allowance: 80% of salary
The daily allowance equals 80% of average income over the last 12 months before birth, capped at CHF 220 per day (equivalent to an annual salary of approximately CHF 88,200). The allowance is paid for 98 days. If income exceeds the cap, the remaining 20% and the excess portion are borne by the employee — unless the employer provides contractual top-ups.
Early termination of leave
The right to the allowance ends prematurely if the mother resumes full-time work before the end of 14 weeks (even a single working day terminates the right) or in case of the mother's death. Resuming part-time work during leave is not possible without losing the allowance for remaining weeks.
Extension for newborn hospitalisation
If the newborn must be hospitalised for at least 3 weeks immediately after birth (e.g. for prematurity), the maternity allowance can be extended for the duration of hospitalisation, up to a maximum of 56 additional days. The mother must submit a medical certificate to the compensation fund.
Paternity leave: 2 weeks
Paid paternity leave has been in effect since 1 January 2021, following the popular vote on 27 September 2020. It is governed by the LIPG and has the following features:
Duration: 2 weeks (10 working days)
The father is entitled to 2 weeks of leave, corresponding to 14 daily allowances. The 2 weeks can be taken as a block or as individual days, at the father's choice. Leave must be taken within 6 months of the child's birth — unused days after this period lapse without possibility of recovery or compensation.
Eligibility conditions
Conditions are analogous to maternity: the father must have been compulsorily OASI-insured for 9 months before the birth and have worked at least 5 months during this period. Legal recognition of paternity (civil registry entry) is required for fathers not married to the mother.
Allowance: 80% of salary
As with maternity, the allowance equals 80% of average income, with the same cap of CHF 220 per day. For an employee with a monthly salary of CHF 7,000, the daily allowance is approximately CHF 187 (CHF 7,000 × 12 ÷ 360 × 80%). Over 2 weeks, the total allowance amounts to approximately CHF 2,618.
Dismissal protection
Unlike maternity (where protection lasts 16 weeks after birth), fathers do not enjoy specific dismissal protection during paternity leave. However, dismissal during legally mandated leave could be considered abusive under Art. 336 CO. Many CLAs provide additional protection.
IC allowance: calculation and payment
Maternity and paternity allowances are funded by the IC regime (Income Compensation), the same system covering military and civil service. Funding comes through OASI/DI/IC contributions.
Daily allowance calculation
The formula is: average salary over the last 12 months ÷ 360 × 80%. The cap is CHF 220/day (equivalent to annual income of CHF 99,000). For part-time workers, the calculation is based on actual salary. For those employed less than 12 months, the actual employment period is used.
Application procedure
For employees, the employer requests the allowance from the compensation fund using the appropriate form, attaching the birth certificate. The allowance is paid to the employer if they continue paying the salary, or directly to the employee if the employment relationship has ended or the employer does not advance the salary.
Social contributions on the allowance
IC allowances are subject to OASI/DI/IC and UI (unemployment insurance) contributions — both employee and employer shares. They are not subject to BVG (2nd pillar) contributions or AIA premiums, as the insurance relationship remains in force during leave without requiring additional coverage.
Employer top-up
Many CLAs and company regulations require the employer to top up the IC allowance to 100% of salary during leave. In this case, the IC is paid to the employer as partial reimbursement, and the employer pays the difference. This top-up is at the company's expense and is not reimbursed by the compensation fund.
For the self-employed, the application must be submitted directly to their own OASI compensation fund, with the birth certificate and latest individual account (IA). The allowance is calculated on the income declared to OASI, which may differ significantly from actual income if not regularly updated.
Tax planning for new parents
The birth of a child has significant tax impacts that, if properly planned, can generate savings of several thousand francs. Here are the main strategies:
Taxation of IC allowances
Maternity and paternity IC allowances are fully taxable income — they are declared as employment income in the tax return. The certificate is issued by the compensation fund or employer. If leave reduces total annual income, the marginal tax rate may be lower, generating an indirect tax saving.
Child deduction
From the child's birth, parents are entitled to a deduction for each dependent child. At federal level the deduction is CHF 6,700 per minor child and CHF 6,700 per child in education (up to age 25). Cantonal deductions vary: Zurich CHF 9,000, Geneva CHF 13,000, Ticino CHF 11,100. Savings depend on the taxpayer's marginal rate.
Pillar 3a contribution in the year of birth
The birth year is often one with reduced income (due to leave) but high expenses. Nevertheless, it is still worthwhile to contribute the maximum deductible to pillar 3a (CHF 7,056): the deduction reduces taxable income precisely in the year when expenses are highest. If liquidity is an issue, contributions can be made up to 31 December.
Income allocation for married couples
For married couples with joint taxation, the year of parental leave may be the ideal time to rebalance incomes: extraordinary 2nd pillar contributions (BVG buyback) from the higher-earning spouse, 3a contributions from both spouses, and deduction of childcare costs (up to CHF 25,000 at federal level since 2023).
Employer obligations
Employers have a series of administrative and accounting obligations related to their employees' parental leave:
- Record the leave request and forward it to the compensation fund within the prescribed deadlines (generally within 5 days of birth for maternity, by the date of use for paternity)
- Continue paying salary during leave if the CLA or company regulations require it, and request IC allowance reimbursement from the compensation fund as partial replacement
- Correctly manage social contributions during leave: OASI/DI/IC/UI contributions remain due on the IC allowance, while BVG contributions follow pension fund regulations (generally contribution exemption during unpaid leave)
- Respect the dismissal prohibition during maternity leave (16 weeks from birth) and generally not discriminate against the employee for exercising parental rights
- Correctly account for the IC allowance: the amount received from the compensation fund should be recorded as a reduction in personnel costs (not as revenue), and the difference between salary paid and allowance received remains a cost for the company
Specifics for the self-employed
Self-employed workers are also entitled to maternity and paternity IC allowances, but with some important specifics:
- The reference income for calculation is that declared to the OASI compensation fund — regularly updating estimated income is essential to avoid allowances calculated on too low or too high a basis
- The application must be submitted directly to your own compensation fund, not through an employer. The form is available from the fund or online (ahv-iv.ch)
- The self-employed must independently organise cover during leave. For self-employed women, the work prohibition in the first 8 weeks also applies to self-employed activity — delegating to a substitute is essential
- IC allowances for the self-employed are subject to OASI/DI/IC contributions but not BVG contributions (which are voluntary for the self-employed). Tax planning is even more important to offset the income reduction during leave
Tips for new parents
- Submit the allowance request as soon as possible after birth: delays in submission do not forfeit the right but postpone payment — impacting family cash flow
- Check whether your CLA or company regulations provide 100% salary integration: many sectors (banking, pharmaceutical, public) offer more generous conditions than the legal minimum
- Fathers: plan the distribution of the 10 days (block or split) in advance and communicate it to the employer — the 6-month window runs from birth, not from notification
- Calculate the tax impact of the birth: child deduction, possible lower marginal rate due to reduced income, and the ability to deduct childcare costs if both parents work
- Don't forget pillar 3a: even in a year with reduced income, 3a contributions generate tax savings that partially offset the income loss during leave
- AccountEX automatically handles IC allowance accounting, social contributions during leave and generates reports for the compensation fund — simplifying management for employers and self-employed alike
Simplify your Swiss accounting
AccountEX handles VAT, QR-invoices and bookings with AI. Start for free.
Start Free