There are many good reasons for working part time: You want to take care of your children, you are completing further education, are self-employed on the side or use the time for something that is important to you personally. Thanks to your reduced workload, you gain the time you need to devote to other important life issues in addition to work.
At the same time, you pay for the time you gain with a loss of income, as your earnings fall in line with the percentage of full-time hours worked. Not only is your income lower today than if you worked full-time – part-time work also has an impact on your personal retirement provision: There may be gaps, not only in your pension, but also in risk protection in the event of death and disability, especially in the event of long-term illness. It is therefore important that you take action to close or at least reduce any gaps.
The OASI pension from the 1st pillar is calculated on the basis of average earnings from gainful employment, the number of contribution years and any parenting and care credits.
For a full OASI individual pension of CHF 29,400, you must pay contributions for 44 years and achieve an average income of at least CHF 88,200 during this time. However, the income of many part-time workers is lower. This reduces the OASI pension. Missing years of contributions also result in the OASI pension being reduced – by 2.3% for each year in which no contributions were paid. You can close missing contribution years within five years if you pay the minimum OASI contribution of CHF 514 (as of 2024).
Incidentally, under the new OASI law, you can continue to work until the age of 70, make OASI contributions and thus increase your retirement income. Alternatively, you can defer drawing your old-age pension for a maximum of five years beyond the reference age. This is another way to increase your pension.
Would you like to know how large you can expect your OASI pension to be? You can obtain a statement of individual account (known as an "IA statement") from any cantonal social insurance institution (SVA), stating your OASI number. This will tell you the expected amount of your OASI pension and what benefits would be paid out in the event of disability or death. You can also ask there whether you still have the option of paying for missing contribution years. You can also order the account statement directly from the OASI Information Office.
Important to know: In the case of married couples, only 150% of the combined total of the individual pensions is paid out, regardless of whether the partners receive the maximum pension or a lower amount.
Low incomes have a disproportionate impact on the 2nd pillar: This is because the contributions are not levied on gross income, but a fixed amount of CHF 25,725 (as at 2024) is deducted, known as the "coordination deduction". For part-time employees, this means that only a relatively small part of the salary is taken into account for the calculation. With a salary of CHF 50,000, only CHF 24,275 would be insured in the second pillar. As a result, you can save less money for your retirement provision and the risk protection in the event of disability or death is often reduced.
Ask whether your pension fund applies the full coordination deduction or whether it reduces or even eliminates it for part-time employees according to the percentage of full-time hours worked. If the coordination deduction is reduced, a higher proportion of your salary is insured, and you benefit from higher benefits accordingly – but you also have to pay more contributions.
If you work for several employers with a small workload, this can have a negative impact on your retirement provision. This is because you will only be admitted to a pension fund if your annual salary is at least CHF 22,050 (as of 2024). If your individual salary per employer is less than CHF 22,050, you are not affiliated with a pension fund. However, you can take out voluntary insurance with the BVG Substitute Occupational Benefit Institution (Stiftung Auffangeinrichtung BVG) or possibly pool all your salaries in the pension fund of one of your employers. Just ask!
In contrast to the 1st and 2nd pillars, your part-time work has no effect on your private retirement provision. With annual earnings from gainful employment of CHF 2,300 or more, you can pay contributions into a pillar 3a restricted pension plan in principle. Currently (as of 2024) this amounts to a maximum of CHF 7,056 per year.
The challenge on a low income is that too little money is left over for retirement provision. Nevertheless, you should try to pay at least a small sum into pillar 3a. As you can deduct the contribution from your taxable income, you save part of the pension amount in taxes. It is worth starting pillar 3a contributions as early as possible, as this allows compound interest to take full effect.
Further information on the 3rd pillar can be found on our overview page 3rd pillar: Pillars 3a and 3b – an overview.
Depending on what type of person you are, a savings insurance policy or a 3a account may be the better option for you.
Benefits of the insurance solution: You can integrate various risk components, for example a premium waiver in the event of disability. In this way, you can be certain that you will actually achieve your savings goal. With an insurance solution, you conclude the pension policy with a fixed period of insurance and commit to paying in a certain amount regularly. This requires you to be disciplined, although there are opportunities to make adjustments.
Benefits of the 3a account: You are completely flexible and can decide at short notice at the end of the year how much money you have left for retirement provision.
As a part-time worker, you will probably also have gaps when it comes to covering the life risks of death and disability. You can fill these via pillar 3a or pillar 3b (unrestricted pension plan). There are arguments for both options. The most important thing is making sure you are actually covered in the first place. Let us advise you!
You can find more differences in our article Bank or insurance.
If you are affiliated with a pension fund as a result of your part-time employment, you, like all employees, may pay a maximum of CHF 7,056 into pillar 3a, regardless of your self-employment.
If your part-time salary is less than CHF 22,050, you cannot be admitted to a pension fund on the basis of this activity. In this case, you are only insured under the 2nd pillar if you choose the legal form of a "GmbH" (limited liability company) or "AG" (corporation) for your self-employment and are accordingly employed by your own company. If you have chosen the legal form of a sole proprietor company, you do not have a 2nd pillar. However, you have the option of paying more money into pillar 3a, namely a maximum of 20% of your net annual income and a maximum of CHF 35,280 (as at 2024).
If you work part time, you have exactly the same entitlement to continued payment of wages as full-time employees if you work at least 8 hours a week in the event of illness or accident. This depends on how long you have worked for this employer and is calculated according to the "Bernese Scale", "Basel Scale" or "Zurich Scale". Many companies have insurance for daily sickness benefits and continue to pay for longer illnesses of up to two years, usually at least 80% of the previous net salary. Disability insurance then takes effect. In the event of accidents, even 90% of the previous salary is paid in accordance with the LAI. Your employer's accident insurance not only covers continued payment of wages, but also the costs of treatment.
However, there is one important exception: If you work for an employer for less than 8 hours, only accidents during working hours or on the way to work, and occupational illnesses are insured through this employer. You must take out additional health insurance to cover the treatment of accidents outside of working hours, which account for two thirds of all accidents. However, there is no continued payment of wages in the event of accidents outside of working hours if you do not work for an employer for more than 8 months.
Important to know: As a part-time employee, you will also receive reduced disability insurance benefits and possibly reduced benefits from the pension fund in the event of permanent disability due to illness. Get advice and find out how you can close any gaps.
