In the referendum held on 27 September 2020, the proposal for paid paternity leave was adopted with 60.3 percent of votes in favour. This will allow fathers to take two weeks' paid leave within six months of the birth of their child. As with maternity compensation, this leave will be funded through the Loss of Earnings Compensation Act (LEC). At its meeting on 21 October 2020, the Federal Council set 1 January 2021 as the date the amendment to the law will come into force.

Entitlement to compensation for loss of earnings

Compensation is paid to fathers who were employed or self-employed at the time their child was born. They must also have been compulsorily insured in the nine months prior to the birth of the child under the OASI scheme and employed for at least five months during this period.

Amount of compensation

As with maternity leave, the compensation amounts to 80 percent of average earned income prior to the birth of the child, capped at 196 francs per day. In the case of two weeks’ leave, 14 daily allowances are paid, which amounts to a maximum of 2,744 francs.

Costs and funding

Two-week paternity leave is funded through the Loss of Earnings Compensation Act (LEC), i.e. principally with contributions from employees and employers. To fund it, the contribution to the LEC will have to rise from the current level of 0.45 to 0.50 percent of wages.

This means the OASI/IV/LEC contribution rates will be 10.60% from 1 January 2021. Half of this amount will be borne by the employee and half by the employer.

Please ensure that the adjustments are made in your payment systems and, if necessary, discuss the impact on your HR regulations with our HR experts.