Inclusion of Employee Contributions by the Military Insurance as Determining Wage

Facts

During an employer audit conducted by the Swiss National Accident Insurance Fund (SUVA), Military Insurance Division, it was found that the net compensation had been invoiced for the daily allowance payments made directly to the insured persons. The Federal Compensation Office (EAK) then ordered that the military insurance daily allowances be "grossed up" and that the corresponding AHV/IV/EO/ALV contributions be levied and invoiced.

SUVA filed a complaint against this decision, which was upheld by the Administrative Court of the Canton of Bern. The Federal Social Insurance Office (BSV) then filed a public law appeal.

Considerations

According to the case law of the Federal Supreme Court, the determining wage generally includes all the employee's earnings that are economically related to the employment relationship. This also includes benefits provided by the employer, such as the assumption of the employee's AHV/IV/EO/ALV contributions.

The Federal Supreme Court concluded that the AHV/IV/EO/ALV employee contributions assumed by SUVA as the employer constitute determining wage for the military insurance daily allowances paid directly to the insured persons. For contribution assessment purposes, the paid daily allowances must therefore be converted to gross values by adding the assumed employee contributions.

The Federal Supreme Court…