Update on Switzerland/France cross-border topic – Immigration – EU pay transparency

• Standard employer certificate to be submitted to the cantonal tax authorities.
• Cross-border taxation changes for Italy.
• Key Swiss immigration considerations for cross-border workers and concerning the upcoming initiative “No 10 Million Switzerland”.
• Starting June 2026, companies operating in EU Member States, including Swiss companies with operations in the EU, will have to follow the EU pay transparency rules.

Executive summary

Effective 1 January 2026, Swiss employers of employees teleworking from France face new reporting obligations. A standard employer certificate must be submitted to the cantonal tax authorities where payroll is not reported electronically and no canton-specific form exists.

Switzerland’s and Italy’s new rules let cross-border workers telework up to 25% without changing their tax status, are effective 1 January 2024.

Immigration: this edition highlights the key Swiss immigration rules for cross-border workers, including eligibility, timelines as well as requirements, and also addresses the upcoming popular initiative “No 10 Million Switzerland”, which could significantly restrict immigration and intensify talent shortage if passed.

The EU Pay Transparency Directive, effective June 2026, introduces major salary transparency and gender pay gap obligations that, while not binding in Switzerland, still impact Swiss employers with EU-based staff and shape expectations in the Swiss labor market.

Summary of Changes to France–Switzerland Tax Agreement

Cross-border taxation

Employer certificate: On 19 March 2026, the Federal Tax Administration (FTA) has published the employer’s certificate concerning employees residing in France, as laid down in article 4 of the double taxation agreement between Switzerland and France. This certificate is intended to be sent to the cantonal tax authority for the purpose of automatic information exchange with France, when information is not reported electronically through a payroll software system. The certificate must be submitted by all payers of taxable benefit, notably employers and insurance companies, at the beginning of each calendar year for the previous tax period. The first time, it must be submitted at the beginning of 2027 for the 2026 tax period. The layout or format of the form may not be modified as it is designed for cantonal scanning and processing. Employers must submit the certificate even if the employee has performed no telework during the year.

What is included in the certificate

• Employee identification details (name, date of birth, address, French tax number, AHV number)
• Calendar year to which the income relates
• Telework percentage (this field must be completed even if no telework was performed, in which case “0%” is reported)
• Total gross remuneration for the relevant period
• Employer contact details and confirmation of completeness and accuracy

Switzerland-Italy: Sustainable rules for the taxation of telework are in force — The amendment protocol that permanently regulates the issue of taxation of telework for cross-border workers came into force on 9 February 2026, after the completion of approval procedures in Switzerland and Italy. The amendment protocol applies with effect from 1 January 2024, and replaces a corresponding amicable agreement. Since that date, cross-border workers have the possibility to work up to 25% of their working time from home without this leading to any change in the applicable taxation rules or the status of cross-border workers.

Immigration

1. Cross-border workers: eligibility and changes subject to notification to authorities

As tax and social security rules for cross-border workers continue to evolve, it is crucial to remain aligned with Swiss immigration requirements.  

• Who is eligible?
  • EU/EFTA nationals who
    • Exercise a gainful activity in Switzerland (salaried or independent)
    • Are domiciled in an EU/EFTA country
    • Return to their domicile at least once a week
  • Non-EU/EFTA nationals who
    • Have a long-term residence authorization in one of Switzerland’s neighboring countries
    • Have a residence in the border area (defined by the authorities) for more than 6 months
    • Return to their domicile at least once a week*

*If all the requirements are met, the Swiss employer must submit an application once labor market test is completed. The application should be filed at least 6-8 weeks prior to employment commencement. Application will be subject to Labor and Immigration authorities’ prior approval.

• When is the employee work-compliant?
  • EU/EFTA nationals: as soon as the application has been filed
  • Non-EU/EFTA nationals: as soon as all required authorities’ approvals have been issued
• How long is the G permit valid?
  • EU/EFTA nationals: for the duration of the work contract (if definite duration) or 5 years; renewable, if indefinite duration
  • Non-EU/EFTA nationals: in accordance with Labor authorities’ decision and duration of work contract
• Is the employee’s work location limited?
  • EU/EFTA nationals: no (professional and geographical mobility)
  • Non-EU/EFTA nationals: yes (change of work location/employer requires a new authorization)
• What type of administrative changes must be notified to the cantonal immigration authorities?
  • End of services
  • Change of employer
  • Change of address
  • Change of civil status
• What about cross-border workers hired in Switzerland for less than 90 days per calendar year?
  • Online notification via the Swiss employer’s EasyGov account (possible for EU/EFTA nationals only)

2. Did you know about the upcoming popular Initiative “No 10 Million Switzerland (sustainability initiative)”?

This initiative, subject to vote on 14 June 2026, aims to enforce stricter controls over immigration in Switzerland in view of maintaining the number of permanent resident population under 10 million before 2050. If accepted, the Federal Council and Assembly would have to take measures as soon as the 9.5 million threshold is reached (Swiss permanent resident population estimated at 9’104’063 at end of 3rd trimester of 2025, according to Federal Statistical Office). 

If accepted, this initiative could potentially have severe consequences, such as:

• Reduced access to long-term residency and citizenship for F permit holders (temporary admission)
• Reduced access to asylum and family reunification for third-country nationals
• Exacerbation of talent shortages in already affected key sectors such as healthcare, hospitality, construction, etc.
• Potential withdrawal from international agreements such as the Agreement on the Free Movement of Persons (as a measure of last resort)

A survey conducted in November 2025 revealed that the initiative enjoyed majority support.

EY will continue to closely monitor developments and host a dedicated webcast on the topic this spring – stay tuned!

Navigating the EU Pay Transparency Directive: Key considerations for organizations, including those in Switzerland

The EU Pay Transparency Directive, entering into force on 7 June 2026, will significantly reshape how companies manage pay, transparency and HR data across the EU. Although Switzerland is not bound by EU law, Swiss companies with employees in EU Member States must comply, and the Directive is increasingly shaping expectations in the Swiss labor market as well.

What will change in 2026-2027

EU Member States must transpose the Directive by June 2026, and several “day one” obligations will apply immediately, including providing salary ranges to applicants and ensuring transparent pay-setting criteria for employees.

Mandatory gender pay gap reporting begins in 2027 for employers with 150+ employees per Member State, based on 2026 data.

This regulatory shift addresses persistent pay disparities: the EU’s gender pay gap remains around 12%, while Switzerland reports a median gap of 8.4%.

Essential steps you must take to meet pay transparency obligations

• Increase transparency in hiring

From June 2026, employers must provide initial salary ranges to candidates, avoid asking for salary history, and ensure gender-neutral job descriptions.

• Give employees access to pay information

Employees will have the right to request average pay levels for comparable roles, and companies must document and communicate pay setting and progression criteria.

• Report gender pay gaps

Companies with 100+ employees must report pay gaps in base pay as well as in variable and complementary pay. Unexplained gaps of 5% or more may trigger a joint pay assessment with employee representatives.

• Adapt to stronger enforcement

Under the new framework, your company must be able to demonstrate the reasons behind pay differences, operate under tougher penalty regimes, and ensure full transparency by eliminating pay‑secrecy provisions.

Implications for Swiss Companies

Swiss employers with employees in EU Member States must comply with the Directive for their EU-based workforce, meeting all transparency and reporting requirements once national laws take effect. At the same time, EU-driven transparency standards are increasingly influencing expectations within the Swiss market. Many Swiss headquarters are therefore moving toward harmonized job architectures and more structured, gender-neutral compensation frameworks to ensure consistency across jurisdictions, strengthen pay equity governance, and align with rising employee expectations even where no formal Swiss obligation exists.

Preparing your organization now for the upcoming requirements

As the EU Pay Transparency Directive approaches full implementation in June 2026, companies operating within EU Member States as well as Swiss employers with staff based in the EU should begin their preparations now.

Five priority action areas will help organizations ensure compliance and minimize future risks:

• Strengthen job architecture and salary structures

Clear job families, levels and gender-neutral evaluation criteria form the foundation of compliance. Companies should update their job architecture and ensure salary bands are consistently applied across all roles to support transparent and defensible pay setting.

• Conduct early pay equity diagnostics

Organizations should proactively analyze pay differences within comparable roles to identify any unexplained gaps. This early review provides time to correct issues before reporting begins, which is particularly important since gaps of 5% or more may later trigger joint assessments.

• Review of hiring and performance processes

Employers must remove salary history questions, use gender-neutral job descriptions and clearly document pay setting and progression criteria. Performance evaluations should be standardized to ensure consistency and reduce bias throughout the employee lifecycle.

• Strengthening HR and payroll data governance

Reliable HR and payroll data will be essential for accurate reporting and employee information requests. Companies should establish cross-functional governance across HR, Payroll, Legal, Reward, and local business leads to ensure consistent data definitions and quality.

• Train managers and HR teams

Managers and HR will be responsible for answering employees’ questions about pay and progression. Providing clear guidance, training and communication materials will help ensure consistent messaging and build trust as transparency obligations increase.

Conclusion

The EU Pay Transparency Directive will transform how your organization manages compensation across all EU operations. If you employ staff in EU Member States, compliance will be mandatory by June 2026, and even if your headquarters is in Switzerland, the Directive is already becoming a practical standard that will influence your internal policies, employee expectations and operational decisions.

By reinforcing your job architecture, running early pay equity analyses, updating hiring and HR processes, and strengthening communication and governance frameworks, your company can not only meet the new requirements but also build a more transparent, fair and competitive reward environment in a rapidly evolving regulatory landscape.