An employee who is at least 50 years of age and who has worked for his employer for a period of 20 years or more is entitled to an allowance as a result of the prolonged period of employment.
According to article 339 b to d of the Swiss Code of Obligations (CO), states that if the amount of the allowance is not stipulated in writing, the judge may determine it according to his own discretion and evaluation of the circumstances. The factors to be taken into consideration include: the employee’s age, length of employment, wages, career prospects, civil status, employer’s contributions to an occupational pension scheme, etc. If the employee receives benefits from an occupational pension scheme, the benefits can be deducted from the allowance.
The allowance may not be less than 2 month’s wages and should not exceed 8 month’s wages (the latter, however, is not an imperative and the employer may grant an allowance equal to more than 8 month's wages if he chooses to do so).
The amount of allowance may be reduced or cancelled if the employee terminates his/her work contract without proper justification, if the employer terminates it with immediate effect for justifiable reasons or if its payment would result in financial difficulties for the employer.
See under the tab « Documents » at the bottom of the page, the Bern scale of reference on which Courts base their decision for the calculation of the indemnity (pdf document in French only).