<h3>A. Introduction</h3>
<p>The Swiss Federal Supreme Court&#8217;s January 19, 2024 decision, which was published on February 12, 2024, concerns an internal investigation into sexual harassment allegations against an employee. In that context, the Court assessed whether the internal investigation, which confirmed a reasonable suspicion of sexual harassment and ultimately led to the employee&#8217;s dismissal, had been conducted properly.</p>
<p>The key rulings from the Court&#8217;s decision are:</p>
<ol>
<li>When private employers perform internal investigations, the standard criminal procedural guarantees do not apply;</li>
<li>Employers do not need to provide an employee subject to investigation with advance notice of an interview or an opportunity to prepare. Rather, it suffices if the employer informs the accused employee at the beginning of the interview of its purpose and content;</li>
<li>The absence of a «person of trust» at the interview does not constitute a serious deficiency in the investigation process that would render the employee&#8217;s termination abusive, even if an employer&#8217;s internal regulations entitle employees to be accompanied by a «person of trust» at such interviews;</li>
<li>Employers are not required to inform the accused employee in detail of the allegations against him or her. Generic and anonymized information about the allegations is sufficient;</li>
<li>A reasonable suspicion, confirmed by an internal investigation, is sufficient basis to ordinarily terminate an employee lawfully even if the suspicion is later proven to be unfounded. Before terminating an employee, the employer is not required to prove the truth of the allegations.</li>
</ol>
<p>The Court&#8217;s ruling rejects the views previously expressed by some legal scholars that employers must provide employees subject to investigation the procedural guarantees accorded to the accused person in criminal investigations.</p>
<h3>B. Summary of Facts and Procedural History</h3>
<p>As noted above, the case concerned an internal investigation regarding allegations of sexual harassment at a bank. Employee A contacted the bank&#8217;s ombudswoman for conduct and ethics and reported sexual harassment by Employee B. The bank conducted an internal investigation to clarify the sexual harassment allegations. As part of the investigation, several employees, including Employee B, were interviewed. The internal investigation concluded that there was sufficient basis for a reasonable suspicion that Employee B had sexually harassed Employee A. As a result, the bank terminated Employee B by observing the applicable notice period.</p>
<p>Employee B then brought a claim for unfair dismissal and damages. The Zurich Labor Court rejected the claim. It held that it was irrelevant whether the allegations of sexual harassment were true or not. Rather, the only relevant factor was whether the bank had sufficiently investigated the allegations. The Labor Court found that it had.</p>
<p>Employee B appealed to the High Court of the Canton of Zurich, which concluded that the bank had not afforded Employee B an adequate opportunity to defend himself against the allegations. In particular, it focused on the lack of detail provided by the bank regarding the allegations, which, according to the High Court, prevented Employee B from adequately defending himself and, in particular, from providing exculpatory facts and evidences. The High Court therefore held that the termination was abusive.<a href="#_ftn1" name="_ftnref1">[1]</a></p>
<p>Thereafter the bank appealed to the Swiss Federal Supreme Court, which overturned the High Court&#8217;s decision.</p>
<h3>C. Findings of the Swiss Federal Supreme Court</h3>
<h4>1. No equivalent procedural guarantees as in criminal investigations</h4>
<p>The Court&#8217;s decision clarifies uncertainty respecting the law applicable to internal investigations in private companies. In a case from May 2016,<a href="#_ftn2" name="_ftnref2">[2]</a> the Court quoted legal scholars who expressed the view that in internal investigations, employers had to provide accused employees with procedural guarantees equivalent to those of a criminal proceedings (i.e., a right to prepare for the defense, be represented by a lawyer, and request the taking of evidence).<a href="#_ftn3" name="_ftnref3">[3]</a> As a result, following the Court&#8217;s May 2016 decision, it was unclear what procedural guarantees, if any, were required in internal investigations. In its recent decision, the Court clarified that its 2016 ruling merely reproduced the views expressed by some legal scholars but did not endorse them.<a href="#_ftn4" name="_ftnref4">[4]</a></p>
<p>The Court further explained that, unlike in a criminal proceedings, in which an accused person is subject to the state&#8217;s criminal power and may face criminal liability (including imprisonment and fines), employees and employers voluntarily enter into an employment relationship and the worst threat an employee can face is termination.</p>
<p>According to the Court, the bank&#8217;s internal investigation provided adequate protections for Employee B because the bank interviewed several employees, reviewed Employee B&#8217;s electronic communications, and provided Employee B an opportunity to comment on the minutes of his interview.</p>
<h4>2. No obligation to announce the purpose and the content of the interview in advance</h4>
<p>The Court held that, unlike in criminal proceedings, employers are not required to inform employees in advance of the purpose and content of an internal investigation interview. Rather, it is sufficient if the employee is informed at the beginning of the interview of its purpose and content. There is no legal requirement to provide the employee with an opportunity to prepare for the interview.<a href="#_ftn5" name="_ftnref5">[5]</a></p>
<h4>3. No right to be accompanied by a «person of trust»</h4>
<p>The Court held that the absence of a «person of trust» at the interview does not constitute a serious deficiency in the investigation process that would render the employee&#8217;s termination abusive, even if an employer&#8217;s internal regulations entitle employees to be accompanied by a «person of trust» at such interviews.<a href="#_ftn6" name="_ftnref6">[6]</a></p>
<h4>4. Right to have the allegations clarified</h4>
<p>The Court confirmed that the internal investigation of a private employer is not comparable to a state criminal investigation and that therefore the employer is not required to inform the employee in detail of the allegations against him or her. Rather, generic and anonymized information about the allegations is sufficient. The Court also explained that accuser&#8217;s identity must be kept confidential and may not be disclosed to the accused employee.</p>
<h4>5. Ordinary termination due to reasonable suspicion is not abusive</h4>
<p>The Court&#8217;s ruling reminded that Swiss employment law is governed by the principle of freedom of termination. This means that there are no particular reasons required for an ordinary termination of the employment relationship.</p>
<p>Accordingly, unlike in criminal proceedings, in which there can be no conviction unless the alleged crime is proven beyond a reasonable doubt, an employee may be terminated based on mere suspicions, even if the suspicions later turn out to be unfounded.</p>
<p>Employers still have an obligation to establish that their suspicions are reasonable before terminating their employees. Termination may be abusive if based on mere allegations absent an adequate investigation to ascertain the trustworthiness of the allegations, or if the investigation fails to establish a reasonable suspicion that the allegations are indeed true.<a href="#_ftn7" name="_ftnref7">[7]</a></p>
<h6><a href="#_ftnref1" name="_ftn1">[1]</a>        OGer ZH LA210022 of May 23, 2023.</h6>
<h6><a href="#_ftnref2" name="_ftn2">[2]</a>        BGer 4A_694/2015 of May 4, 2016, E. 2.4.</h6>
<h6><a href="#_ftnref3" name="_ftn3">[3]</a>        BGer 4A_694/2015 of May 4, 2016, E. 2.4.</h6>
<h6><a href="#_ftnref4" name="_ftn4">[4]</a>        BGer 4A_368/2023 of January 19, 2024, E. 4.1.</h6>
<h6><a href="#_ftnref5" name="_ftn5">[5]</a>        BGer 4A_368/2023 of January 19, 2024, E. 4.4.1.</h6>
<h6><a href="#_ftnref6" name="_ftn6">[6]</a>        BGer 4A_368/2023 of January 19, 2024, E. 4.4.2.</h6>
<h6><a href="#_ftnref7" name="_ftn7">[7]</a>        BGer 4A_368/2023 of January 19, 2024, E. 4.2.</h6>


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No Criminal Procedural Guarantees in Internal Investigations

<p>On January 15, 2024, the EU Commission published its <a href="https://ec.europa.eu/commission/presscorner/detail/en/ip_24_161" target="_blank" rel="noopener">report</a> on the results of its first review of the adequacy decisions previously taken under the old EU Data Protection Directive. The EU Commission concludes that <strong>Switzerland continues to provide an adequate level of protection for personal data</strong> transferred from the EU.</p>
<p>According to its report, the EU Commission welcomes the developments in the Swiss legal framework since the adoption of the first adequacy decision in July 2000, including in particular the modernization of the Swiss Data Protection Act (cf. our <a href="https://www.homburger.ch/en/insights/revision-of-the-swiss-data-protection-law-is-complete" target="_blank" rel="noopener">Bulletin</a> of August 31, 2022). These developments have contributed to an increased level of data protection, in a manner sufficient for the EU Commission to maintain its adequacy decision.</p>
<p>Maintaining the EU adequacy decision was one of the main objectives of the revision of the Swiss Data Protection Act, which entered into force on September 1, 2023: Without the EU&#8217;s recognition of the adequacy of Swiss data protection law, the export of personal data from the EU to Switzerland would have become much more burdensome. Today&#8217;s confirmation by the EU Commission thus marks the achievement of a key goal in the efforts to modernize Swiss data protection law in a manner consistent with the EU General Data Protection Regulation (GDPR).</p>
<p>The review of adequacy decisions by the EU Commission, which has now been completed, is the first such review since the GDPR came into force in 2018. The GDPR calls for regular reviews, and the EU underlines its intention to further intensify dialogue and cooperation with like-minded international partners on data flows and digital issues in general.</p>


EU Confirms Adequacy of Swiss Data Protection Law

<h3>New Landmark Decision of the Swiss Federal Supreme Court</h3>
<h3>A. Consequences for Swiss Employers</h3>
<p>This new landmark decision is important for many Swiss employers, particularly in the event of future government shutdowns or other similar scenarios where government actions affect all players in a particular industry in the same way. The key takeaways of this decision may be summarized as follows:</p>
<ul>
<li>In principle, employers are responsible for operational risk affecting their businesses. However, «<em>operational risk»</em> is not defined in the law. As a rule, it refers to circumstances that fall within the sphere of risk of the employer and <strong>do not constitute objective reasons</strong> within the meaning of Art. 91 of the Swiss Code of Obligations (<strong>SCO</strong>);</li>
<li>Official business closures ordered by the authorities, including such measures taken in the context of the COVID-19 pandemic, <strong>fall outside of the employer&#8217;s operational risk if such measures affect everyone in a certain sector of activity equally</strong>. In this scenario, the employer is not obliged to continue to pay the employees&#8250; salaries pursuant to Art. 324 CO.</li>
</ul>
<p>The decision of the Swiss Federal Supreme Court ensures a uniform interpretation of federal law, thus putting an end to certain cantonal jurisprudence with divergent decisions.<a href="#_ftn1" name="_ftnref1">[1]</a></p>
<p>This decision is however silent on whether employers are entitled to claim reimbursement of salaries (or set them off against outstanding claims) paid without having a legal obligation to do so.</p>
<h3>B. Summary of Facts and Procedural History</h3>
<p>Employees B., C. and D. worked as teachers at a private school run by A. AG. In January 2020, the employees terminated their employment agreements with effect on August 31, 2020.</p>
<p>As a result of the measures taken to fight the COVID-19 pandemic, A. AG decided to close the private school, to stop face-to-face teaching and to switch to online teaching. A. AG informed the employees in April 2020 that, due to the introduction of online teaching, they would no longer reach the contractually agreed working hours. A. AG further indicated that it was not legally obliged to continue paying the employees&#8250; salaries for the work time cancelled, essentially because COVID-19 and the resulting official measures, including the official closure of the private school, did not fall within the employer&#8217;s operational risk. Because B., C. and D. had terminated their employment agreements with A. AG prior to the official closure of the private school, it was not possible for A. AG to apply for short time working reimbursements either. A. AG was therefore forced to reduce the employees&#8250; salaries for July and August 2020 due to their respective minus hours.</p>
<p>B., C., and D. brought action before the District Court of St. Gallen, which ordered A. AG to pay the salary for the cancelled working time. The Cantonal Court of St. Gallen rejected A. AG&#8217;s appeal.</p>
<p>A. AG then appealed to the Swiss Federal Supreme Court. The Swiss Federal Supreme Court discussed the matter in a public hearing on August 30, 2023. The Swiss Federal Supreme Court admitted the appeal filed by A. AG.<a href="#_ftn2" name="_ftnref2">[2]</a></p>
<h3>C. Findings of the Swiss Federal Supreme Court</h3>
<p>The Swiss Federal Supreme Court had to decide whether an employer is required under Swiss law to continue paying the salary in the event of an official business closure ordered by the authorities as part of the measures to fight against COVID-19. In essence, A. AG argued that it was not obliged to continue paying the salaries because the official business closures to combat COVID-19 did not fall within the operational risk of the business for which it is responsible.</p>
<p>To resolve this legal dispute, the Swiss Federal Supreme Court had to examine Art. 91 combined with 324 SCO: Pursuant to Art. 91 SCO, the employer is in default if it refuses, without objective reasons, to accept performance of work properly offered by the employees or to carry out such preparations as it is obliged to make and without which the employee cannot render performance of work. According to Art. 324 SCO, the employer is obliged to continue to pay the employee&#8217;s salary if the employer does not accept the work duly offered by the employee.</p>
<p>According to the Swiss Federal Supreme Court, the legislator did not intend to automatically impose on the employers any arbitrary business risk that does not fall within the sphere of the employees. Rather, the employer is only in default to accept performance of work if the refusal to accept the work is unjustified. In the context of employment law, it is undisputed that employers bear the operational risk of the business they operate. However, the term «<em>operational risk»</em> is not defined in the law. As a rule, it refers to circumstances that fall within the sphere of risk of the employer (but not of the employee) and do not constitute objective reasons within the meaning of Art. 91 SCO.</p>
<p>The controversial delimitation between justified and unjustified refusal to accept performance of work boils down to determining the scope of the operational risk for which the employer is liable. Whether a circumstance falls within the employer&#8217;s operational risk must be determined on a case-by-case basis. In this context, it must in particular be assessed whether the reasons that led to the refusal to accept performance of work are linked to:</p>
<ul>
<li>A risk inherent to an individual business (e.g., state ban on production directed against a business, withdrawal of an operating license, refusal to grant a work permit, etc.) in which case the employer is legally required to continue paying the salary pursuant to Art. 324 SCO; or, on the contrary,</li>
<li>An objective reason affecting everyone in a certain sector of activity equally (e.g., wartime economic measures, import ban, exposure to unreasonable legal risks by accepting performance, etc.), in which case the employer is not required to continue paying the salary pursuant to Art. 324 SCO.</li>
</ul>
<p>According to the Swiss Federal Supreme Court, the official business closure ordered by authorities to combat the COVID-19 pandemic qualifies as objective reasons within the meaning of Art. 91 SCO. Indeed, in such a case, the risk is not inherent to a specific business due to its specific production and working conditions. Rather, the impossibility to perform work is the consequence of a sovereign intervention of the state to fight a general risk situation, which the individual employer did not cause and is not responsible for in the broadest sense. This general risk is ultimately the result of political decisions to contain the risk of infection, which the employer does not have to bear. The Swiss Federal Supreme Court further held that an employer would have exposed itself to unreasonable legal risks if it had maintained its business in violation of the official decision to close the businesses.</p>
<p>As a result, employers who have to close their business due to official decisions in the context of the COVID-19 pandemic have an objective reason to refuse the work performance offered by employees and are therefore not obliged to pay the salary pursuant to Art. 324 SCO.</p>
<h6><a href="#_ftnref1" name="_ftn1">[1]</a> For instance, see the decision of the Superior Court of the canton of Zurich of February 6, 2023 in the proceedings LA220011 available <a href="https://www.gerichte-zh.ch/fileadmin/user_upload/entscheide/oeffentlich/LA220011-O4.pdf">here</a>.</h6>
<h6><a href="#_ftnref2" name="_ftn2">[2]</a> Decision of the Swiss Federal Supreme Court 4A_53/2023 of August 30, 2023 available <a href="https://www.bger.ch/ext/eurospider/live/de/php/aza/http/index.php?lang=de&amp;type=highlight_simple_query&amp;page=1&amp;from_date=&amp;to_date=&amp;sort=relevance&amp;insertion_date=&amp;top_subcollection_aza=all&amp;query_words=4A_53&amp;rank=1&amp;azaclir=aza&amp;highlight_docid=aza%3A%2F%2F30-08-2023-4A_53-2023&amp;number_of_ranks=5293">here</a>.</h6>
<p>&nbsp;</p>


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No Obligation to Pay Salaries During Official Business Closure Due to COVID-19

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We welcome Reto Ferrari-Visca, Jeremy Reichlin and Alexander Wherlock to our partnership.

Three new partners

<p>We welcome Reto Ferrari-Visca, Jeremy Reichlin and Alexander Wherlock to our partnership.<br />
<a href="https://www.homburger.ch/en/home/welcome?utm_source=News-EN&amp;utm_medium=Newsmeldung-EN&amp;utm_campaign=Partner-26">Learn more.</a></p>


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Homburger advised The SPAR Group Ltd on the sale of its Swiss retail and wholesale business to Tannenwald Holding AG

<p>On September 8, 2025, The SPAR Group Ltd entered into an agreement to sell its entire shareholding in SPAR Holding AG including its Swiss business operations (SPAR Switzerland) to Tannenwald Holding AG. The sale has been completed with immediate effect. SPAR Switzerland operates approximately 358 stores and owns 11 cash &amp; carry outlets and one distribution centre in Switzerland, all under several formats including SPAR, SPAR Express, EUROSPAR, Maxi and TopCC.</p>
<p>The transaction reflects an equity value of CHF 46.5 m and includes potential earn-out payments of up to CHF 30 m due at the end of FY27 based on certain EBITDA milestones.</p>
<p>The Homburger team was led by Frank Gerhard and comprised Patrick Schmidt, Carlo Sulser, Florian Bruggisser, Jannis Zafeirakos and Leon Indov (all Corporate / M&amp;A), Richard Stäuber, Andreas Burger and Kristina Martinovic (all Competition), Stefan Oesterhelt, Reto Heuberger, Juliette Buob and Philippe Weber (all Tax), Stefan Bindschedler (Financing and Investment Products) as well as Luca Dal Molin and Noëmie Beck-Schär (both IP / IT) and Jeremy Reichlin (Employment).</p>


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Homburger advised Alcon Inc. on its USD 1.5 bn acquisition of STAAR Surgical

<p>On August 4, 2025, Alcon Inc. (SIX/NYSE: ALC), the global leader in eye care, and STAAR Surgical Company (NASDAQ: STAA), the manufacturer of the Implantable Collamer® Lens for vision correction (ICL), entered into a definitive merger agreement through which Alcon intends to acquire STAAR, for a total equity value of approximately USD 1.5 bn. The acquisition includes the EVO family of lenses (EVO ICL™) for vision correction for patients with moderate to high myopia (nearsightedness), with or without astigmatism.</p>
<p>The transaction is anticipated to close in approximately six to 12 months, subject to customary closing conditions, including regulatory approval and approval by STAAR’s shareholders.</p>
<p>The Homburger team was led by Frank Gerhard (Corporate / M&amp;A) and included Héloïse de Jamblinne and Thomas Romelli (both Corporate / M&amp;A), Jeremy Reichlin (Employment and Executive Compensation), Jürg Frick and Nathalie Scherrer (both Financing), as well as Stefan Oesterhelt and Adrian Schwarz (both Tax).</p>


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Homburger advised The SPAR Group Ltd on the sale of its Swiss retail and wholesale business to Tannenwald Holding AG

Homburger advised Alcon Inc. on its USD 1.5 bn acquisition of STAAR Surgical

No Criminal Procedural Guarantees in Internal Investigations

EU Confirms Adequacy of Swiss Data Protection Law

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JeremyReichlin

Three new partners

Homburger advised The SPAR Group Ltd on the sale of its Swiss retail and wholesale business to Tannenwald Holding AG

Homburger advised Alcon Inc. on its USD 1.5 bn acquisition of STAAR Surgical

No Criminal Procedural Guarantees in Internal Investigations

EU Confirms Adequacy of Swiss Data Protection Law

No Obligation to Pay Salaries During Official Business Closure Due to COVID-19

§7 Datenschutz im Arbeitsverhältnis

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