Thursday, January 31, 2013

Dear Frau: Expat or Local Swiss Contract?

Welcome to another edition of Dear Frau. It’s kind of like Dear Abby, except with an international twist. Remember, if you’ve got a question about living in Switzerland or moving to Switzerland, don’t hesitate to contact The Frau.

Dear Frau,

I am currently investigating the option of expat versus local Swiss contract for work at a company in the Baden area.  As an American, what are the benefits of both from your perspective?   Also, is there a contact of yours that may be able to share their perspective of a local Swiss contract with elementary-aged children that initially came from the States?

Expat Or Local

Dear Expat Or Local,

Free flights home: one benefit of an expat contract
Unless you know you want to live in Switzerland forever, an expat contract is nice work–if you can get it. Unfortunately, more and more companies are taking away many of the benefits typically offered by expat contracts. So it’s hard for The Frau to tell you what’s best without knowing your exact options. However, expat contracts usually are financially advantageous (although they can be emotionally challenging because you’ll probably end up living in limbo).

The Frau has no way of knowing what your expat contract terms may be. So she will make them up, based on what many good ones often include in order to demonstrate why expat contracts are more advantageous to local ones.

Advantages of an expat contract:

Lower commitment level (typically expat contracts are between 1-5 years)

Includes a look-see visit

Air tickets home once a year (big benefit, especially if you have children, it is often hard to find cheap flights)

Tax assistance (big must for Americans)

Tax equalization (pay taxes as though you were living in your home country only)

Education assistance for school children (a company that will pay the CHF 30,000 international school fees for you…)

HR support (The Frau had great support from her husband’s HR department)

Housing stipend (typically over CHF 2000 a month, although it is taxed like income—also why your base salary may end up lower than it would be on a Swiss local contract)

Relocation specialist to help you find and secure housing in CH (necessary if you don’t speak the local language)

Language lessons

International insurance (great benefit, since Swiss insurance is very pricey and does not include dental or eye care…The Frau misses CIGNA International, sigh.)

Moving expenses (both there and back…unless of course, you go local later)

Job security (is a company going to let you go if it will cost them CHF 30,000 to move you back across the ocean?)

Transportation benefit (train passes or car lease, etc., cost also added to your salary and is taxable)

The option to go local later if you love it (like The Frau…)

Advantages of a local contract:

You won’t be living in limbo

You may invest more in learning the local language by knowing you will be here indefinitely

Higher base salary (you’ll need it without all the expat extras!)

Swiss child stipend ((an additional CHF 200/month per child (amount depends on the canton you live in–200 is for Baden) added to your paycheck))

You will be protected by Swiss unemployment (if you end up working long enough and with the right permit...)

Swiss pension (might be good, might not be good—depends on the company)

Paid only in Swiss Francs (a big advantage for Americans now, look at the dollar!)

Anyone else want to chime in and help Expat Or Local, especially those with children that came from the States? Merci vielmal from The Frau.


Hattie said...

People on contracts had a much higher standard of living than we did, living there, with my husband just a regular employee for a Swiss company. We did send our children to the international school, but we had to pay for that and it was so expensive that we did without other things. Contract workers had houses; we lived in an apartment. Our standard of living was the sufficient but modest one that most Swiss have. We did end up sending our older daughter to the Swiss public school and would have sent our other daughter there too if we had remained there instead of returning to the States.
And now I collect the Swiss pension that they give to mothers. That is something women with children might want to consider, because it is quite a nice benefit. I enjoy the extra money, which, combined with my U.S. SS is quite a tidy sum. It is pro-rated but still more than I would get with U.S. SS alone.

Kimberly said...

As one who had our kids go into the international school for 3 years while on an expat contract and then switched over to local schools when we went on local contract, I HIGHLY recommend the local school path, especially with younger children. That gift of a second language is incredible, no matter how long you stay! If we were to do it over again, we'd still do one year international - get our feet on the ground, then switch over.

Chantal said...

Hi ladies,
Thanks so much for your input, The Frau is sure it helps the Expat Or Local as well as anyone else searching for such information.

Hattie, what is this mother pension you mentioned? The Frau is not aware of this.

Interesting to know you tried both school paths and preferred the local one. The Frau will try to do a post on schools soon.

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Anonymous said...

Usually it is not a choice that is left up to the individual. We have been on expat contracts and local contracts in several different countries. There really isn't so much a comparison- if you are offered an expat contract financially it is a better deal. Rent/schools/cars/bills/ flights/ healthcare paid vs paying yourself. We are in Switzerland with a Swiss company on a local contract. We knew the cost of living and the cost of education and decided it was worth it for us, luckily the salary/package offered allows us to have options. We are involved with local sporting clubs, our neighbors and community, but send our children to the International School-while the kids language skills are not as good as if they were at local schools, they are doing fine. For us it was a curriculum/educational philosophy and we really like the IB program, worldwide. Switzerland is a fantastic place to live, especially with school age children!

Hattie said...

Oh Frau, I am so glad you asked! I did not find out about this benefit until a friend told me about it. And it was my husband who had to wend his way through the intricacies of the Swiss bureaucracy to get it for me. (I'm no good at that sort of thing.) They don't come around with information and even the Internet seems to be not much of a source. This money could mean a lot to you some day if you take the usual hit on your career that happens to moms in Swizerland

Here is the contact information:

Schweizerische Ausgleichskasse
Aveneu Ed-Vaucher 18
CH-1211 Genf 28
Tel: 0041 22 795 91 11
Fax: 0041 22 797 15 01

When I first started collecting Swiss AHV I even got a lump sum to cover the time I had not been signed on for it!
One thing you would love that is SO Swiss: periodically I have to send them a form on which I affirm that I am still alive!
Kimberly: I like the idea of giving kids a year to get their feet on the ground (and your feet too, what with those crazy school hours) before putting them in the public schools. I found, by the way, that a kid's looks and personality have a lot to do with how well they are accepted. My older daughter was very popular and something of a star who was in the Gymnasium at the time we left. My younger daughter got picked on in the neighborhood for reasons I still can't figure out. Maybe her darker more "southern" looks, easier going ways and being less of a linguist than her older sister had something to do with it (although later on she became fluent in French after a junior year abroad). I was relieved that our return made it possible for her to sidestep a potentially bad school experience.

Anonymous said...
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Anonymous said...
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Randall said...


Does the mother pension also pertain to men that are the primary care givers? I am in husband of the person that wrote the original letter to The Frau and I am the house hubby.

Chantal said...

Hi Hattie,
Do you know the answer to Randall's question? I know there aren't many house husbands in Switzerland.

Randall, speaking of house husbands, there's a great book called Big in China by Alan Paul that I think you may enjoy. Alan went to China as a trailing spouse and he writes about his experience in this book.

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