Bern, Switzerland (GenevaLunch) – Switzerland’s first report on black market labour highlights a good deal of illegal activity, but it draws no clear conclusions about the extent of the problem. Labour inspectors in 2008 conducted more than 9,000 inspections that involved 35,000 workers. Nearly half of the inspections, 46 percent, involved suspicions of law-breaking by the employer’s canton, which the report says is not surprising: a large number of investigations were prompted by tips from the public or other public agencies. More than 1, 300 resulted in sanctions.

The report covers the first year in which cantons sent inspectors into every industry in Switzerland in compliance with a federal law to combat the shadow economy, which came into force in January 2008. The report is published by the State Secretariat for the Economy (SECO).

Cantonal inspectors check employers and employees for compliance with social security, tax, and immigration laws. The hotel and temporary employment industries, as well as construction and building supplies industries were the most frequently investigated.

The application of the law from one canton to another varied widely in 2008, the report shows, with Vaud, for example, less zealous than Zurich. Geneva appeared to target large companies, which Zurich did not.

The government introduced simplified reporting procedures with the law, in order for employers to declare workers and social security deductions, and 12,615 companies took advantage of this in 2008.

Le Temps argues that there is considerable public skepticism over the need to consider black market labour a serious crime, with only 41 percent of the population saying they consider it a serious crime, in a poll. The government in 2007 waged a consciousness-raising campaign that focused on black market workers not being paid adequately or receiving social security benefits. The newspaper raises the question of the usefulness of spending CHF6 million francs to recover CHF435,000.

The “shadow economy” in OECD (Organization for Economic Cooperation and Development) countries, of which Switzerland is a member, is estimated to be over 13 percent of the gross domestic product (GDP) in 2009, reports the Economist.

You can leave a response, or trackback from your own site.