An employee worked for a Swiss IT company but lived and worked in France. The company and the employee had agreed that his employment would be governed by Swiss law and that he would be paid in Swiss francs into a Swiss bank account. He was covered by the Swiss social security system and paid tax in Switzerland. He also had a Swiss email address and a Swiss telephone number.
After five years, the company terminated the employee in accordance with Swiss law. Following the termination, a dispute arose as to whether the employee should instead have been terminated in accordance with French law.
The European Court of Justice ruled that Swiss rules should apply if the employment relationship was most closely connected with Switzerland overall, even though French law would have provided the employee with greater protection. Which rules applied depended on which country the employment relationship was most closely connected with overall. This assessment had to be based on all objective criteria.
iuno's opinion
Generally, a choice of law may not deprive an employee of the protection afforded by mandatory rules in the country where the employee usually works. However, the case shows that if the employment relationship is more closely connected with another country, that country's rules apply instead.
iuno recommends that, in international employment relationships, companies carefully assess which country's rules apply. The key question is whether the objective circumstances of the employment relationship, such as social security, taxation, salary, and other terms and conditions of employment, point to the country in question. At the same time, it is important for the company to ensure that employees maintain their connection to the country whose rules have been chosen. We have previously written about a case where a change in the place of work could affect which country's rules apply here.
[The European Court of Justice in case C-768/24 of 9 July 2026]