EU Treaty: Economiesuisse and Employers' Association call for "lean implementation" in Swiss law

But that was quick. The new constitutional agreement between Switzerland and the European Union comprises approximately 800 pages. Citizens, politicians, and associations have only known the contents of this massive package for four weeks. A comprehensive assessment of all risks and side effects is difficult to achieve in such a short time. But for Economiesuisse and the Swiss Employers' Association (SAV), one thing is already clear: This agreement is necessary.

Just in time before the population embarked on their summer holidays, the leaders of the two umbrella organizations spoke out on Friday, emphasizing that "the business community" supports the package. Christoph Mäder, President of Economiesuisse, described this as an "initial positioning." This does not yet constitute a final judgment, especially since parliamentary deliberations on the implementation of the agreements into Swiss law are still pending.

Mäder said: "Stable and forward-looking relations with the EU have become even more important for Swiss companies." Referring to the tariff dispute with the US, he added that recent months have shown that reliable and rules-based relations cannot be taken for granted. Severin Moser, President of the Swiss Employers' Association, agreed, describing the EU Treaty as a solid foundation for stabilizing and further developing the bilateral path.

The main goal of the event was likely to demonstrate unity. How united "the economy" actually is remains an open question. In addition to Economiesuisse and SAV, there are several other groups and associations in Switzerland that also consider themselves part of the "economy." This includes, in particular, the Trade Association, the umbrella organization for SMEs. The agreement is considered more controversial among its members. The Trade Association therefore plans to make a decision at the end of October, after a broad consultation among its members.

The fact that Economiesuisse and the Swiss Federal Association of Swiss Employers (SAV) support the EU package is entirely unsurprising; there was never any doubt about that. However, the two associations link their approval with demands. A "lean and business-friendly" implementation of the agreement into Swiss law is now needed. The goal must be to ensure both optimal market access to the EU and attractive framework conditions for Switzerland as a business location.

Another demand: the principles of a flexible labor market must be maintained. However, a conflict with the unions is emerging here. While the employers' association continues to support the 13 "domestic policy measures for wage protection" agreed upon by the social partners in March, the Federal Council has, so to speak, overridden this agreement and submitted an additional measure for consultation. This measure is quite significant.

The 14th measure provides for improved dismissal protection for employee representatives. What exactly this has to do with wage protection remains a mystery. If anything is protected, it's hardly wages, but rather union members. The Employers' Association rejects the measure as irrelevant, especially since there is no direct connection to maintaining the level of wage protection, as Roland Müller, SAV Director, explained.

Therefore, there is no agreement between the social partners on this dismissal protection measure. Nevertheless, it has made it to the consultation stage. It now remains to be seen which side will prevail. Pierre-Yves Maillard, President of the Trade Union Confederation, has so far skillfully managed to get the unions to vote yes to the EU treaty package at a high price. All this has resulted in the labor market in Switzerland becoming increasingly bureaucratic.

It is unclear how many people would benefit from the improved dismissal protection. Investigations are ongoing, explained Müller. Estimates range from a few thousand to 30,000. This range is explained by the large number of people named in the measure. This applies not only to elected employee representatives, but also to pension fund trustees and industry executives in sectors with generally binding collective bargaining agreements.

That sounds complicated—and it probably is. The impending wrangling between the social partners over dismissal protection for union members is certainly further evidence that the flexible labor market, once a locational advantage for Switzerland, is increasingly threatening to become rigid as Switzerland moves closer to the EU. Whether the EU Treaty will nevertheless be smoothly transposed into Swiss law, as Economiesuisse and the Swiss Association of Employers (SAV) are demanding, remains to be seen.