Working for an international organisation such as the UN or the World Bank offers the prospect of meaningful work and exciting experiences in faraway countries. Anyone pursuing an international career should, however, keep a number of points in mind, as the professional environment is changing.
The work remains exciting, but international organisations are also under financial pressure. Shrinking budgets and cutbacks are increasingly shaping the working environment, and permanent contracts are becoming difficult to obtain in many cases. This need not deter you. However, it is advisable to plan ahead and make appropriate provision.
1. Social security systems of international organisations
Working for these organisations often means joining their respective social security system and leaving the Swiss social security system. There are, however, exceptions, for example for many Swiss employees of the ICRC or employees of certain non-governmental organisations co-funded by Switzerland. The social security systems of international organisations are generally good and, much like state systems, provide cover for risks such as old age, illness, accidents or death. The longer you work for the organisation, the better your benefits tend to be.
For example, you start paying into the UN pension scheme from your first day of employment. However, you only acquire an entitlement to a pension after five years of contributions. If you leave the UN before then, your own contributions are refunded, but you lose the employer contributions. Only after 15 years with the UN are you entitled to the full employer contributions if you opt for a lump-sum payment.
International organisations also sometimes do not consider themselves responsible for what happens after the employment relationship ends. It is therefore all the more important to obtain additional protection against social risks wherever possible.
2. OASI and DI
For retirement provision, it is often possible to continue paying into the OASI system. Each year with a contribution gap reduces your OASI pension in retirement by around 2.3%. OASI also goes hand in hand with disability insurance (DI). This aspect should not be underestimated.
- International organisation based in Switzerland
Swiss nationals who work for an international organisation based in Switzerland generally have the option of continuing to contribute to OASI, DI, IC (income compensation, e.g. for maternity) and UI (unemployment insurance), or to UI only. However, you must apply for this within three months. - Residence in Switzerland, assignment abroad
Swiss nationals who retain their residence in Switzerland but work for an international organisation outside Switzerland can generally register with OASI as an employee whose employer is not liable to pay contributions (ANobAG). In this case, you pay both the employee and employer contributions for OASI, DI, IC and UI. This solution depends on the willingness of many OASI compensation offices to accept ANobAG status for assignments abroad as long as it can be argued that your centre of vital interests remains in Switzerland. - Giving up residence in Switzerland
Swiss nationals who give up their residence in Switzerland may join the voluntary OASI and DI scheme if the country of assignment is outside the EU/EFTA, they were insured under OASI for the five years immediately preceding their departure, and they submit their application within one year.
3. Pillar 3
Contributions to Pillar 3 are not permitted if both your residence and place of work are abroad and, in most other situations, are not worthwhile, as Pillar 3 is only financially attractive if contributions can be deducted from income tax.
4. Unemployment insurance
One major challenge is that international organisations do not pay unemployment benefits. Depending on the length of employment with the international organisation, a severance payment may be made when the employment relationship ends. However, international organisations do not generally provide unemployment insurance. For Swiss nationals working for an international organisation based in Switzerland, it is therefore attractive to remain covered by UI at least. For others, where circumstances allow, it may be advantageous to retain residence in Switzerland and remain insured as an ANobAG.
5. Health insurance
While employed by an international organisation, you will generally have international health insurance. Swiss nationals working for an international organisation based in Switzerland are no longer subject to compulsory Swiss health insurance unless they expressly wish to remain covered. Those who retain their residence in Switzerland but are assigned abroad generally remain subject to compulsory health insurance in Switzerland despite having international health insurance. You can try to apply for an exemption, although cantonal authorities are becoming increasingly restrictive in this area.
6. Pregnancy and maternity
When it comes to maternity, several issues need to be considered. If pregnancy and maternity occur while you are employed by an international organisation, you are generally well protected. However, if you become pregnant towards the end of your employment, the rules of the respective organisation determine whether you and your child will remain covered by health insurance throughout the pregnancy and around the time of the birth. Income compensation can also be particularly challenging. If there is a possibility that you may become pregnant during a fixed-term appointment, it may therefore be advantageous to choose an arrangement that allows you to remain insured under the Swiss income compensation scheme (IC).
7. Private cover
In certain areas, private solutions are available, for example private retirement savings plans or insurance covering disability or death. Particularly if you are unable or do not wish to remain covered by OASI/DI, it is worth taking a closer look at these options. In other areas, private cover is not available, for example for the risk of unemployment or loss of income due to maternity.
8. Costs of additional cover
The costs of additional cover, whether through OASI, UI, compulsory health insurance or private solutions, must always be borne by the individual concerned. International organisations do not cover these costs. The question therefore arises as to what additional protection you can and wish to afford. State social security options are often a good solution, although private solutions can sometimes be less expensive.
9. Taxes
You should also take the tax implications into account when planning. If you are employed by the UN, your income is tax-exempt even if you reside in Switzerland. If you are a Swiss national residing in Switzerland and work for the World Bank, however, this income is generally taxable. Pensions are usually taxable as well. Lump-sum withdrawals, on the other hand, are often tax-exempt if the income itself was not taxable. It is therefore worth examining your individual tax situation.
10. Who do these rules apply to?
The information above applies to Swiss nationals who, by virtue of their employment, are considered international civil servants. Different rules apply to UN Volunteers (UNVs) or consultants.
Please do not hesitate to contact us so that we can review your individual situation together. We will be happy to assist you.