Switzerland: The Swiss Reference Letter: A Balancing Act between Legal Obligation, Digitalisation and Dispute Trigger
Swiss labour law grants employees the right to demand a reference letter from their employer at any time. In practice, however, it is common for every employee who leaves the company to receive a reference letter even without demanding. This is the result of the high value directly linked to reference letters during recruiting processes, including the requests for reference letters to be part of a job searchers portfolio as well as the undeniable Swiss hyper fixation of employees and employers to dissect and interpret reference letters like a poem, looking for hidden meanings and secret codes. It is, therefore, not surprising that many labour disputes revolve around the wording of reference letters. The following article is intended to outline both the legal requirements for a reference letter as well as possible dispute triggers, and how to navigate the topic of the reference letter with more ease.
Step 1: Differentiate between the three types of Swiss reference letters
Art. 330a of the Swiss Code of Obligations (CO) grants an employee the right to request a reference letter from their employer at any time. Art. 330a CO distinguishes between a reference letter that provides information about the type, duration, performance and behaviour of the employee (Art. 330a para. 1 CO) and a simple confirmation reflecting solely the type and duration of the employment relationship (Art. 330a para. 2 CO). The latter is usually used for very short employment relationships or occasionally for employment relationships that did not go well. The decision lays with the employee regarding which kind of reference letter they request. When it comes to a reference letter, according to Art. 330a para. 1 CO (full reference), the timing of the reference letter is vital. During an employment relationship, a so-called interim reference letter is to be issued, whereas by the end of the employment relationship, a final reference letter must be given. The main difference is that an interim reference letter is written in present tense instead of the past tense like in the case of a “final” reference letter. Moreover, the interim reference may only cover a certain time period of the employment, whereas the final reference needs to address the full term of the employment relationship.
Once it is decided what kind of reference letter is to be issued, the great obstacle of phrasing and structuring the reference letter commences.
Step 2: Meeting the content requirements of a reference letter
Since a simple work confirmation according to Art. 330a para. 2 CO only states the type and duration of the employment relationship, this will not be discussed any further in this article. However, if you have any questions, we will gladly assist you.
Although the Swiss labour law does not specify exact requirements for the content of a reference letter, according to established doctrine and case law, the following content is to be included:
- Brief description of the employer
- employee’s full name and date of birth
- start and end date of the employment relationship
- function of the employee
- promotions (if any)
- percentage of employment (mentioning of the respective time frame if varying);
- detailed list of main responsibilities (and their duration)
- performance evaluation (knowledge and experience, quality and quantity of work, special skills, reliability etc.)
- personality and behaviour evaluation
- date of issue
- employer’s signature
The reference letter must only state who terminated the employment relationship if terminated by the employee. The reason of termination is usually not mentioned, unless requested by the employee. After the content has been gathered, the wording needs to match the legal standards.
Step 3: Correct wording of a reference letter – avoiding room for unjustified disputes
Phrasing a reference letter is often a dreadful task as the reference letter must be benevolent and at the same time truthful, while being constantly challenged by employees for various reasons. Unfortunately, over the past few years, the (mis-)conception has arisen that a reference letter that is only satisfactory to mediocre ruins an employee’s professional future irreparably and that some employers even use secret codes to harm exiting employees. While in most cases it is not true, this fear has created great hostility between employers and employees when it comes to reference letters. To navigate the difficult task of phrasing a reference letter, we suggest studying the employee’s file beforehand. Statements about the work quality, quantity and an employee’s behaviour may only be classified as less than satisfactory if there is concrete evidence of unsatisfactory achievements and behaviour. If there is no evidence to back up a less than good classification, a dispute will be lost due to lack of proof. In deviation from this, an excellent performance reference must be proven by the employee.
Furthermore, an employer should be particularly careful when mentioning absences due to illness or accident, single negative incidents without major consequences, as well as the reason for dismissal. In case of a prolonged absence due to sickness or an accident, an employer should refrain from mentioning it if the cause of absence did not irrevocably affect the employee’s performance and/or was not excessive considering the overall duration of the employment relationship. A former rule of thumb was that the absence may only be mentioned if it lasted for at least half of the entire duration of the employment relationship. The Supreme Court has revoked this rule without replacing it with a set timeline. However, it emphasises that every absence should be weighed against the duration of the employment individually and regarding its overall effect on the company (BGE 4A_574/2017). Rare negative incidents such as uncommon tardiness, brief decreases in performance, criminal charges not in relation to the employment relationship, and smaller disagreements at work are to be left out. Only repeated and documented misbehaviour may be included. The reason for dismissal can only be stated upon the employee’s request. Otherwise, it mustn’t be stated, unless it would defeat the duty of the reference letter to be truthful.
At this point, employers are suddenly forced to perform a balancing act between the duty to be truthful whilst also being benevolent. However, the duty for the reference letter to be truthful outweighs the duty to be benevolent if there is concrete evidence to back up the statements as well as that the actions which caused the employment relationship to be terminated were of such a degree, that they must be mentioned to raise awareness for future employers. In addition, using phrasing which is misleading or could be seen as coding is prohibited.
Strong, clear, and simple language should be chosen. Once the reference letter has been written, the dating as well as signing of it poses further room for discussions.
Step 4: Dating, signing and delivering the reference letter
The reference letter should show the date of the official end date of the employment relationship. Therefore, it is important to sign and date the reference letter on the last day of employment – if possible – as at a later stage it might have to be back dated. This is because an odd date on the reference letter might indicate a termination without notice or that the parties participated in a long labour law dispute. Of course, the actual date of termination is also the correct in case of a dismissal for good cause without notice. If the termination without notice later is deemed unjustified, the reference letter must be re-dated to the date the employment relationship would have ended with an ordinary termination.
We live in a world of digitalisation, which has affected reference letters too. Although not stipulated by the law, the court rulings clearly demand a signature in writing, which means that the signature must be written by hand (“wet signature”, Art. 14 CO) or be a qualified electronic signature (QES) in accordance with Art. 14bis CO. Especially as the majority of recruitment processes happen digital nowadays and HR processes are digitalised constantly, the signing of reference letters with an electronic signature gains popularity. A simple digital signature (e.g. DocuSign) does not meet the requirements of a QES under Swiss law, and an employee can request a hand signed or properly electronically signed (with QES) reference letter in such a case. For more information about the requirements of under Swiss law qualified electronic signatures and their validation process, we take the liberty to refer to our newsletter from July 2024 wherein we discussed this topic in detail. At this point we would, however, like to address an obstacle when using a QES to sign a reference letter. QES normally shows the exact date and time the signature has been added to the document, which is why the timing must be planned carefully when choosing this tool.
In summary, the abovementioned requirements for a reference letter have not changed much over the last years. What has changed is the way employers and employees approach reference letters, sometimes even abusing them as collateral in employment relationships that went sour. We suggest seeking legal counsel before issuing rather unsatisfactory reference letters or even wanting to state the cause of dismissal or duration of an absence. Otherwise, an employer should aim to be benevolent and exclude any incidents or evaluations without concrete evidence to minimise the risk of a costly court battle.
