What is a sabbatical?

Ein Sabbatical, auch Sabbatjahr genannt, ist eine in der Regel unbezahlte Auszeit vom Job. Sie beträgt meist A sabbatical is time spent away from your job, generally unpaid. It usually lasts between three and twelve months. During this time, people in employment get the chance to recover from their professional obligations and engage in personal development not connected to their job. People in employment often use a sabbatical to take a moment to slow down and get to know themselves a little better. They often explore questions such as “what do I want to do with my life?”

Sabbaticals are becoming more and more popular in Switzerland. There are already some rules for civil servants to support them as they take time off work. But people in employment on the free market are also increasingly taking the opportunity to explore personal development by taking a sabbatical. Even though there is no official legal right to do so, many larger companies support their employees taking a break from work as they benefit from the recovered, newly motivated employees when they return.

Taking a sabbatical: plan in advance

More and more employees in Switzerland are taking sabbaticals to travel the world, volunteer or explore vocational re-orientation. They want to fulfil long-standing dreams or redefine their personal goals. But careful planning is needed to ensure you can fully enjoy your time off work. That way, you’ll also be protected if you fall ill or have an accident.

Planning your sabbatical: pension schemes and insurance policies

If you are planning a sabbatical in Switzerland, you should actively take steps to protect your pension. If you don’t, stopping work for longer than a month could have an effect on your financial security later in life.

If your sabbatical lasts less than a month, you will continue to be insured with AHV (old-age and survivors’ insurance) as per the law. This is your 1st pillar protection against disability and death as the result of accident or illness. The 2nd pillar of your occupational pension will also continue as normal.

However, if you stop working for longer than a month, the benefits you will be entitled to will depend on your particular pension fund. Benefits may continue for anywhere from 6 to 24 months. The type of sabbatical you take is also important: will you be returning to your job after your break, or do you want to quit and take a different job afterwards?

Short break with salary

If you are only taking a short break from your job and will continue to get paid, you don’t have to worry about your pension. In this case, you will still be paying into the AHV and your pension fund. If you want to keep paying into pillar 3a from your salary, that is also not a problem.

Companies allow employees to take this type of sabbatical under various conditions:

• Overtime: If you have collected overtime hours over a longer period of time, you can use these hours for a sabbatical. As you were not initially paid for the overtime, you will continue to receive your salary.
  
• Reduced pay: You can also opt to continue to get paid during a sabbatical by accepting reduced pay beforehand over a longer period of time; the money not paid to you during this period will be paid during your sabbatical. However, you must have been employed with your company for at least six months to take this type of sabbatical.
• Part-time work: If you switch to part-time work in preparation for your sabbatical, but continue to work full time, you will collect many hours of overtime. You will then be paid for these hours during your break. However, just as with reduced pay, you must have worked for your company for at least six months in order to qualify for this option.

Use unpaid leave for your sabbatical

Some companies allow their employees to take unpaid leave for their sabbatical. Although they do not receive a salary, they maintain their statutory social insurance. They also have the right to return to their job after their sabbatical is over. What to bear in mind in terms of your pension:

• AHV: Your pension amount depends, among other things, on your average gross income and the number of years you have paid into AHV. You should avoid years in which you do not pay into AHV if at all possible because your pension will be reduced for each year you do not pay in. If Switzerland remains your primary place of residence, you should do your best to continue to pay your AHV contributions in order to avoid penalties later on.
  
• Pension fund: You could also end up with pension gaps in your pension fund after taking a sabbatical. The amounts will depend on your salary, age and the time you spend on your break. The older you are, the higher your pension fund payments are – and the larger the pension gap. This is because neither you nor your employer will be paying into the pension fund if you take unpaid leave. Some pension funds offer the option of voluntarily saving in the fund during a sabbatical. Or you can also buy in at a later date. You should contact your pension fund to find out which option is best for you. It can also make sense to make private provisions for your pension.
• Pillar 3a: The size of the gap in pillar 3a will depend on how long your sabbatical is. If you are planning to take twelve or more months off, you should be aware that you will not be able to open a 3a account or pay into it. This is because you are not earning income subject to AHV contributions. However, you can continue to hold an existing 3a account regardless of how long you will be on sabbatical. When you return to work, you will be able to resume your payments.

Quitting your job to take a break

If you want to start a new career and quit your job before taking a sabbatical, you will need a private pension. This will help you to avoid large gaps in your retirement provision.

• AHV: Just like with unpaid leave, you remain subject to AHV contributions as long as your place of residence during the sabbatical is Switzerland. It is a good idea to keep making payments to avoid pension gaps.
  
• Pension fund: If you leave your old job without having found a new one, you have to open a vested benefits account. You then need to move the capital you saved in your pension fund to this account until you have a new job. Once you have found a new job, you have to pay this capital into your new employer’s pension fund. You can reduce pension gaps by buying into the pension fund as soon as you have started your new job.
• Pillar 3a: If you do not have income subject to AHV, you cannot pay into your 3a account. This can create pension gaps. It therefore makes sense to make private provisions for your pension.

What insurance do you need on sabbatical?

A sabbatical can be a good way to recharge your batteries. But if you want to relax and enjoy it fully, you should first make sure you are properly protected. In addition to plans for your retirement provision, there is other insurance coverage that can help keep you financially secure. So it’s best to take precautions.

Accident insurance: take out your own protection

If you are no longer receiving a salary, you will remain insured against accidents for 30 days after the date of your last salary payment. After that, you no longer have insurance coverage through your employer. You have two options to ensure you remain insured during your sabbatical:

• Accident insurance: You can take out your own accident insurance. You can often include accident risk coverage in your health insurance. You are then responsible for paying the insurance premiums.
  
• Insurance by convention: You can also take out what is known as insurance by convention with your former employer’s accident insurance provider. This will cover any costs that arise as a result of an accident. You are responsible for paying the insurance premiums. However, you can only take out this type of insurance for a maximum of six months.

If you travel to another country for your sabbatical and de-register in Switzerland, you will have to purchase insurance coverage in the country you will be spending your time in.

Health insurance: check you are covered abroad

If you remain registered at your address in Switzerland, you will continue to have health insurance coverage during your sabbatical. This is because basic insurance is uniformly regulated. If you will be spending your sabbatical in a EU/EFTA country, then you will also be protected by basic insurance in the event of accident or illness.

If you are staying outside of the EU/EFTA, basic insurance will pay at most double the costs that would apply in your canton of residence for your treatment. It is therefore often a good idea to take out supplementary insurance, particularly if you plan to visit a country where medical costs are high, such as Japan, Australia, Canada or the USA. Supplementary insurance usually also covers the costs of repatriation back to Switzerland for medical reasons, or emergency transport costs in other countries.

Daily sickness benefits insurance: extend your cover

Many insurance companies offer the option of maintaining your daily sickness allowance insurance even after you have ended your employment or during a sabbatical. You are responsible for paying the premiums. Depending on the amount covered, it may also make sense to take out additional cover or travel insurance with your health insurance.

Returning to work after a sabbatical: key points to consider

It is very likely that both you and your workplace will have changed during the time you were away. You should therefore make sure you take enough time to get used to working again. It’s best to plan a transition back to work.

If you quit your job before taking a break, you will want to make sure you start job searching in good time. It’s best to clearly state the reasons for your sabbatical in your CV. Explain what goals you achieved during your time away from work. Once you have started a new job, you have to transfer the capital in your vested benefits account to the new pension fund.