22 March 2021

Electronic Signatures in Employment Law

The digitalisation of the work environment offers many new technical possibilities. One of these is the signing of documents with the help of new tools that generate electronic signatures. In practice, electronic signatures are already widely used. Certain legal rules, in particular formal requirements and the statutory requirements for a valid electronic signature, must be observed.

Principle: No formal requirements

As a general rule, according to Article 11 of the Swiss Code of Obligations (CO), contracts do not have to be agreed in writing to be valid. Only consensus is required, i.e. mutual and consensual declarations of intent by all parties involved. The written form is only required if it is prescribed by law or if the parties contractually agree on such a formal requirement.

There is also no formal requirement for the conclusion of an ordinary employment contract. An oral employment contract is in principle valid and binding. However, for reasons of legal certainty and evidential value, oral employment contracts are rather rare. In practice, most contracts are concluded in writing. This is to increase legal certainty and the evidential value of the conclusion and content of a contract.

If no written employment contract is concluded, the employer is obliged to inform the employee in writing about the minimum content of the contract (i.e. contracting parties and start date, function, salary and salary supplements as well as weekly working hours) no later than one month after the start of the employment relationship.

Finally, an employment contract can also come into existence without corresponding declarations of intent by the parties on the basis of the legal presumption of Article 320 para. 2 CO. A so-called de facto employment relationship arises if the employer accepts work as a service, the performance of which, according to the circumstances, can only be expected in return for wages.

Exception: Formal requirements in employment law

However, certain obligations of a typical employment contract must, according to the law, be agreed between the parties in a simple written form in order to be valid. This requires that the contract bears the handwritten signature of all parties who intend to be bound by the contract.

This procedural provision applies in particular to the, in practice relevant, assignment of intellectual property rights of the employee to the employer (Article 165 para. 1 CO, Article 332 para. 2 CO), the exclusion of compensation for overtime work (Article 321c para. 3 CO), the extension of the probationary period beyond one month (Article 335b para. 2 CO), the extension of the notice period (Article 335b para. 2 CO) as well as restrictions that are to apply after the termination of the employment relationship, such as post-contractual non-compete or non-solicitation clauses. In addition, certain formal requirements apply to special employment contracts (e.g. apprenticeship contracts, contracts for temporary work, contracts for commercial travellers, etc.).

Finally, employment contracts often contain contractual formal requirements regarding termination or amendment of the contract, e.g. that notice of termination must be given in writing. If such a written form requirement exists, there is a presumption that the parties do not intend to be bound before its compliance (Article 16 para. 1 CO).

Electronic signatures

In the event that the written form is required (or useful), the signature may also be in electronic form. Electronic signatures are regulated in the Federal Electronic Signature Act (ZertES). An electronic signature essentially confirms the identity of the person signing and the traceability of the signed information, i.e. the contents of the signed document and whether they have been changed since it was signed.

A distinction is made between four different forms of electronic signature, which have different technical characteristics: The 'simple' electronic signature; the advanced electronic signature; the regulated electronic signature; and the qualified electronic signature.

Under Swiss law, according to Article 14 para. 2bis CO, only the qualified electronic signature, which is provided with a qualified electronic time stamp, is equivalent to a handwritten signature. Only this form of electronic signature fulfils the formal requirement of simple written form – whereby deviating legal or contractual provisions are reserved.

It is important to note that the qualified electronic signature must be issued by a recognised provider of certification services. The Swiss Accreditation Service (SAS) accredits the recognition bodies, which in turn are responsible for recognising providers of certification services (cf. Article 5 para. 1 ZertES). The only current recognition body is KPMG AG. There are currently only four recognised providers of certification services in Switzerland: Swisscom (Schweiz) AG, QuoVadis Trustlink Schweiz AG, Swiss-Sign AG and the Federal Office of Information Technology, Systems and Telecommunication (FOITT).

Attention with electronic signatures

The following applies in principle: If writing is required by law or has been contractually agreed as a formal requirement, the contract in question must contain the handwritten signature of the parties involved (Article 13 para. 1 and Article 14 para. 1 CO). If this is not the case, the contract is not valid (Article 11 para. 2 CO). This also applies to unilateral declarations, e.g. a notice of termination, for which a written form requirement applies.

Not every electronic signature fulfils the legal form requirements and not every electronic signature is equivalent to a handwritten signature. A valid electronic signature is not the same as a signature reproduced by mechanical means, e.g. by a stamp, by printing or by facsimile.

We therefore recommend clarifying any formal requirements and the type of electronic signatures before signing documents. This will ensure that the electronic signature used meets the legal requirements and that the document is validly signed. In the case of documents that already have an electronic signature, it is worth taking a closer look and checking the validity of the signatures.

Our employment law team will be happy to answer any questions you may have on this topic.

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Categories: Employment Law

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