New EU jobless-benefit rules could cost Switzerland hundreds of millions

A shift in who pays could add hundreds of millions of francs to Switzerland’s annual bill. On Thursday, November 12, the European Commission informed Bern of a change to the division of responsibility for unemployed cross-border workers. Under the revised approach, benefits would be paid by the country where the person last worked, replacing the current responsibility of the country where they live. The change matters to Switzerland because existing agreements make the amended EU rules relevant to the country. The State Secretariat for Economic Affairs, or SECO, estimates the additional annual cost at CHF 500 million to CHF 800 million. The National Council is urging the Federal Council to reject the amendment. The issue has emerged in discussions about implementing the free movement of persons, alongside changes to EU coordination rules for social security. For Bern, the immediate concern is how the new allocation of responsibility would affect unemployment benefits for cross-border workers.

The revised rule ties benefit payments to the last place of work. If an unemployed cross-border worker last held a job in Switzerland, Switzerland would become responsible for paying benefits under the amended approach, even when that person lives across the border. The current division assigns payment responsibility to the country of residence. That change in the paying state is the core of the dispute for Bern. The European Commission raised the issue during discussions on implementing the free movement of persons, which also cover EU rules coordinating social security. Existing agreements make the amended regulations relevant to Switzerland. The proposed approach therefore reaches beyond a technical adjustment between EU states: it could alter Switzerland’s financial responsibility for people who commute across its borders for work. SECO’s estimate puts the possible extra cost at CHF 500 million to CHF 800 million each year, reflecting the potential scale of the change for the Swiss unemployment-benefit system.

More than 413,000 cross-border commuters were working in Switzerland at the start of 2026. Federal figures put the total at 413,320 in the first quarter. That scale helps explain why a change to unemployment-benefit coordination could carry a substantial price tag for Bern. SECO’s estimate of CHF 500 million to CHF 800 million in additional annual costs points to a recurring expense, not a one-off payment. The figure relates to the possible impact of the amended rules on unemployment benefits for cross-border workers. The new allocation would make the last country of employment responsible, rather than the worker’s country of residence. Switzerland’s large cross-border workforce is therefore directly relevant to the debate over how the rule would operate under existing agreements. The issue sits within broader discussions about the free movement of persons and the coordination of social security between Switzerland and the EU.

The National Council wants the Federal Council to reject the amendment. Its position sets up a political challenge for Bern as discussions continue over the implementation of the free movement of persons and the EU’s amended social-security coordination rules. The change would assign unemployment payments to the country where a worker was last employed, with Switzerland potentially facing CHF 500 million to CHF 800 million in extra costs each year, according to SECO. The European Commission informed Bern of the change on Thursday, bringing the allocation question into focus for Switzerland because of its existing agreements. The dispute concerns both the rules governing cross-border benefits and the financial responsibilities that follow from them. The Federal Council is being asked to oppose the change, while the National Council has already called for rejection. The debate now centres on whether Switzerland should accept a system that could make it responsible for benefits based on a worker’s last job in the country.