This article is Part 3 of the series "Genuine Self-Employment After Unemployment".
The integration of jobseekers into the primary labor market forms the primary core mandate of Swiss Unemployment Insurance (ALV). A specific, highly complex instrument designed to achieve this overarching goal is the labor market measure (AMM) "Promotion of Self-Employment" (FSE) pursuant to Art. 71a to 71d of the Unemployment Insurance Act (AVIG) in conjunction with Art. 95a to 95e of the Unemployment Insurance Ordinance (AVIV).
This measure aims to enable unemployed individuals to plan and prepare a permanent, economically viable self-employed activity in a structured manner, without being subject during the planning phase to the existential pressure of an immediate loss of earnable income or the rigid obligation to search for employment. Financial support is provided primarily through the payment of regular unemployment daily allowances during a defined planning phase and secondarily through the optional assumption of loss risks for guarantees.
This report analyzes the FSE measure in extreme substantive and legal depth. The analysis is based entirely on federal legal foundations, current Federal Supreme Court case law, binding directives from the State Secretariat for Economic Affairs (SECO AVIG Practice AMM and ALE), and specific cantonal implementation provisions of the Canton of Graubünden. A particular regional focus lies on the administrative handling for jobseekers from the Viamala region, specifically the municipality of Domleschg, interacting with the competent Regional Employment Center (RAV) Thusis, the Office for Industry, Commerce and Labor (KIGA) Graubünden, and the Social Security Administration (SVA) Graubünden.
Prerequisites for Receiving Daily Allowances During the Planning Phase
The granting of daily allowances for the promotion of self-employment is tied to strict normative conditions that must be fulfilled cumulatively. The substantive review of these prerequisites is the responsibility of the cantonal authority—in the Canton of Graubünden, the KIGA—in close consultation with the competent unemployment fund (ALK). The measure explicitly does not serve to grant insured persons unjustified economic advantages or to subsidize individual sectors, but primarily aims at the permanent termination of unemployment.
The applicant must primarily meet the general eligibility criteria for unemployment compensation (ALE) according to Art. 8 AVIG. This implies that the person concerned must strictly be unemployed and suffer an assignable loss of work of at least two consecutive full working days, resulting in a loss of earnings. Regarding the contribution period, the law requires proof of at least 12 contribution months within the regular two-year frame period for the contribution time. However, the legislature grants exceptions: Individuals who are legally exempt from fulfilling the contribution period—for instance, due to schooling, illness, or the cancellation of an Invalidity Insurance (IV) pension—may also be eligible for planning-phase daily allowances, taking into account any special waiting periods.
A mandatory demographic requirement is that the insured person must have completed their 20th year of age at the time the benefit is paid out. In addition, lawful residence in Switzerland is essential; cross-border commuters are excluded from this specific benefit of the Swiss ALV and must assert their claims in their state of residence.
A fundamental premise is the applicant's general employability (availability for placement). Until the date of the legally binding FSE approval by KIGA, the person must generally be ready, able, and entitled to accept a suitable position. SECO states unequivocally in its AVIG Practice AMM (para. K31) that an existing lack of employability cannot be legitimized by a retroactively issued FSE decision. This applies particularly in scenarios where the insured person has already independently begun implementing the planning phase without having submitted a formal application to the responsible RAV within a useful period. In the administrative practice of KIGA, accepting a suitable salaried position always takes priority over promoting self-employment.
| Criterion | Legal Definition and Implementation in the FSE Context | |---|---| | Unemployment | Assignable loss of work and earnings of at least 2 days; registered with the RAV. | | Contribution period | 12 months of contribution time within 2 years or presence of a statutory exemption ground (Art. 14 AVIG). | | Age & Residence | Reached 20 years of age; mandatory residence in Switzerland (no cross-border commuters). | | Employability | General readiness and ability to accept suitable employment until formal FSE approval. | | Causality | No self-fault for unemployment caused specifically for the purpose of starting a business. | | Project status | Mandatory focus on a new business startup; no takeover of existing operations. |
A critical legal stumbling block during application review is the causal connection between the onset of unemployment and the desire for professional self-employment. According to established SECO AVIG Practice AMM (para. K7), financial support pursuant to Art. 71a et seq. AVIG is strictly excluded if the insured person resigned from their last salaried position specifically for the purpose of becoming self-employed. Unemployment insurance is designed as loss insurance and cannot legally be anticipated as a state startup fund.
If a job is given up voluntarily without a justifying reason (Art. 30 para. 1 lit. a AVIG), the cantonal authority must order penalty suspension days (Einstelltage) regarding benefit entitlement. The Federal Supreme Court has confirmed in constant case law that the duration of suspension is measured according to the degree of fault and can amount to up to 60 days in cases of severe fault. If a direct causal link exists between this self-inflicted resignation and the FSE application, the application will be rejected in full. This inhibiting causal link is only deemed legally broken if the insured person decides to pursue self-employment after several months of regular daily allowance receipt and demonstrably unsuccessful job search, or if they have held a salaried position in the primary labor market for at least six consecutive months in the interim.
Another essential distinction concerns the nature of the venture: New startup versus company takeover. Conceptually, daily allowances during the planning phase serve exclusively to prepare a completely new economic existence. Federal Supreme Court precedent and explicit SECO directives (para. K23) stipulate that no daily allowances for the planning phase may be approved for taking over an already existing, operationally active company or joining such a structure as a partner. The legal and economic rationale behind this states that for an established company, the primary planning and preparation phase of market entry has already been completed. Administrative changes to be made, such as commercial register filings or notary appointments in a takeover, are considered mere execution acts of an already concluded entrepreneurial decision and do not justify a multi-month exemption from unemployment insurance duties.
If all normative preconditions are met, the cantonal authority approves a planning phase of a maximum of 90 daily allowances, corresponding to a duration of roughly four calendar months. If fewer than 90 daily allowances remain in the insured person's regular two-year framework period for benefit receipt, these planning daily allowances can only be granted within the scope of the remaining claim, as exceeding the statutory frame period is impermissible. If several unemployed persons decide to build a single project together, each of them has an individual claim to a maximum of 90 daily allowances.
During this approved phase, a major administrative privilege applies: The insured person is completely exempt from the ordinary control regulations pursuant to Art. 17 AVIG. They do not need to prove personal job application efforts to the unemployment fund and are released from the obligation to attend job placement counseling meetings at the RAV. During this period, they continue to receive 70 or 80 percent of their insured earnings in the form of daily allowances in order to dedicate themselves full-time to developing their business. Before or during this planning phase, KIGA can approve attendance at specific courses or coaching sessions (such as the IFJ FsE support program) to convey the methodical tools for opening a business; for the duration of such courses, the FSE planning phase is formally suspended, and the person receives standard ALE benefits, after which the remainder of the FSE daily allowances can continue to be drawn.
