Swiss stepping up checks over suspicious pay support scheme claims

ZURICH (Reuters) - Swiss authorities are intensifying checks regarding possible abuse of a short working hours scheme introduced last year to help soften the impact of the COVID-19 pandemic on the job market.

Around 900 possible cases of abuse had bee detected as of May, the State Secretariat for Economic Affairs (SECO) said in a statement on Monday.

It said a further 500 suspicious corporate compensation claims were found by unemployment insurance authorities.

Switzerland last year extended and simplified access to its “Kurzarbeit” scheme that lets companies top up pay for employees on reduced hours with funds from unemployment insurance rather than laying them off.

It paid out around 11.8 billion Swiss francs ($13.10 billion) under the scheme in the 13 months to March, statistics show.

SECO said it had hired 40 external inspectors to help it intensify checks at companies.

It had carried out 131 checks by the end of May, finding 13 cases of abuse and 97 where mistakes had been made. It intends to conduct another 200 checks this year and 700 next year.

The Swiss Federal Audit Office (SFAO) voiced criticism.

“We don’t understand why the simplified procedure gets extended again and again. It is time to return to the normal way or at least to reintroduce some security features,” SFAO’s Garbriela Carrapa told Reuters.

SECO labour directorate head Boris Zuercher defended the simplifications that make it easier for companies, including many small players from cultural and catering sectors, to apply and also for authorities to process the high number of requests.

“We’ll investigate all the indications of abuse we receive,” he told reporters on a call.

Switzerland’s unadjusted jobless rate fell to 3.1% in May, from 3.3% in April.

The number of people and companies concerned by shorter working hours was also down in March as Switzerland gradually lifted COVID-19 restrictions.

($1 = 0.9007 Swiss francs)

Reporting by Silke Koltrowitz; editing by Jason Neely