Holiday Pay: Part 1 - Components and Calculation

The employer must pay the employee the full salary due during the holidays. However, the salary can often be divided into individual categories, which are to be considered differently when determining the holiday pay.

Legal Basis

‍The holiday pay is regulated in Art. 329d of the Code of Obligations (CO). Paragraph 1 states: "The employer must pay the employee the full salary due for the holidays and an adequate compensation for missed benefits in kind". However, what is meant by the "full salary due" is not as clear as it sounds. In certain employment relationships, the salary can be categorized into different components, not all of which are necessarily included in the holiday pay.

‍The different categories

‍Generally, it can be said that for determining the salary to be paid, the average income of the previous year is used as a basis if the income is irregular. This includes fluctuating salary components such as commissions, which must be taken into account when calculating the holiday pay. If the employer has regularly performed overtime over a long period, their compensation must also be included in the determination of the holiday pay. If the 13th-month salary is not paid out completely due to termination of the employment relationship or for other reasons, this portion must be considered in the holiday pay.

A component of the salary that does not have to be included in the holiday pay are expenses directly related to the work performance. Finda helps you to keep your taxes simple and hassle-free.