Gross and net pay
Gross salary is the agreed pay before deductions, net salary the amount paid out; the difference is the employee’s share of social insurance and, where applicable, withholding tax.
Definition
For the employer, gross salary is not the whole cost: their own shares of AHV, IV, EO, unemployment insurance, the pension fund, accident and possibly sickness daily allowance insurance are added, plus family allowance contributions. These employer costs are in the order of roughly fifteen to twenty per cent of gross pay.
In Switzerland the gross figure is what is usually agreed. A net salary agreement is possible but shifts the risk of contribution changes onto the employer and makes payroll more work.
Where to read it
What the software must be able to do
What is needed is the gross-up calculation: can the software derive the gross salary from a desired net salary? For net salary agreements and compensation payments that is the difference between one keystroke and a manual iteration.
Checked Aug 2026
More terms under Payroll, staff and expenses: Accident insurance (UVG) AHV contributions BVG and pension fund Collective agreement rules Construction agreement Coordination deduction Cross-border workers Employer’s payroll costs Expense flat rates Expense policy Extra-mandatory pension cover Family allowances Holiday pay in cash Hospitality agreement Hospitality collective agreement IV and EO Maternity allowance Owner’s salary Payslip Pension (BVG) deductions Pillar 3a Private share Salary statement Secondary employment Sickness daily allowance (KTG) Staff meals Swissdec ELM Thirteenth month salary Unemployment insurance (ALV) Withholding tax Work permits Working-hours recording (ArG)