Employers try to crack open borders

Voters are due to go the polls on September 25 to decide whether to make it easier for immigrant workers mainly from eastern European nations to get jobs in wealthy Switzerland.

The vote is seen as a litmus test for Switzerland's relations with its European Union neighbors and a 'no' vote could jeopardize a whole package of deals with Brussels and hamper Swiss firms' ability to trade in EU countries.

"The EU could not tolerate its new members being discriminated against," said economist Bernd Schips from the Swiss KOF think tank.

With economic growth forecast at less than one percent this year, Swiss politicians and companies argue embracing migrants from the 10 new EU member states would kickstart the economy.

However, the campaign to throw out the law is gaining force among voters worried for their jobs.

An opinion poll published in Le Matin newspaper showed the 'yes' camp had fallen to 42 percent from 49 percent in a previous poll, with 39 percent indicating a 'no' vote, compared to 36 percent in the previous poll.

The anti-immigrant Swiss People's Party (SVP), which has two seats in the coalition Swiss cabinet, is running a campaign warning that job security would be the first casualty of a 'yes' vote in the poll. In July, Switzerland's unemployment rate was 3.5 percent.

Foreign Minister Micheline Calmy-Rey, one of the socialist party's two cabinet members, told the paper that waning support suggested Swiss voters were still unsure over what was at stake.

"We know that the Swiss have concerns and it is easy for the opponents to play on those concerns," she said, vowing to get the 'yes' message across to more of the electorate.

Swiss companies and industry groups have called on voters to give the green light to the law, allowing workers from Poland, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Slovakia, Slovenia, Malta and Cyprus to seek jobs in Switzerland.

In its defense, the Swiss cabinet notes a quota on the number of workers allowed in each year would remain in force until at least 2011, and that laws preventing so-called wage dumping would be beefed up.

If the opponents of the law win through, Brussels could enact a so-called guillotine clause pulling the plug on a raft of agreements made in 1999, and thereby potentially hampering Swiss firms' ability to trade freely in Europe.

"We have to win this vote," said Urs Landolf, head of PricewaterhouseCoopers' European tax and legal advice. "The lion's share of our value creation results from exchange with Europe." (Reuters)