In the 19th century, foreign nationals had no access to public welfare, which was linked to municipal citizenship. Consequently, they depended on the support of private welfare organisations. This began to change once welfare authorities adopted the principle of residence towards the end of the 19th century. When they had a regular income, foreign nationals were eligible for mutual assistance schemes providing cover in case of illness and death benefits. In practice, however, only a small fraction of workers were insured by assistance funds.

From the 1870s onwards, as the Confederation began to improve workers’ protection and later introduce the first social insurance schemes, the main issue was to what extent foreign nationals were to benefit from these programs. Before the First World War, policy tended towards equal treatment of foreign workers. Social policy was a tool for promoting the loyalty of foreign workers to domestic employers and for preventing any potential conflicts. This stance was reflected in both the Factory Act (1877) and Lex Forrer (1900).

The First World War marked a turning point in immigration policy. The notion of ‘excessive immigration’ took root and attitudes towards immigration in both politics and among the population became more sceptical. As a result immigration was restricted. The first instance of foreign nationals being clearly discriminated against could be found in the Health and Accident Insurance Act (KUVG) of 1912. According to this law, foreign workers only received three quarters of insurance benefits until 1927, provided there was no agreement of reciprocity between Switzerland and the migrant’s country of origin. The principle of reciprocity gave foreigners from certain nations access to social security if Swiss citizens were granted the same rights when they registered as migrants in those countries. The KUVG did not encompass occupational illnesses that had existed prior to the migrants’ arrival in Switzerland. In 1931, the Federal Act on the Temporary and Permanent Residence of Foreign Nationals enshrined a more sceptical stance towards immigration into law by creating the status of ‘short-term residents’ or ‘seasonal workers’, who were legally excluded from social security to a large extent. Henceforth, a distinction was made among foreign nationals depending on the length of stay: foreign nationals who had settled permanently were treated almost equal to Swiss citizens, while seasonal workers were largely denied access to social insurance schemes.

Initially, unemployment funds did not distinguish between workers with or without citizenship. However, the Federal Act on Unemployment Insurance of 1924 introduced the option of excluding foreign nationals whose country of origin had not entered into a reciprocity agreement with Switzerland. A more restrictive set of policies therefore began to take hold in the 1930s: seasonal workers were denied access to unemployment funds and had to leave the country in the event of unemployment. As a consequence of this regulation, job cuts in Switzerland during the crisis of the 1970s were only partially reflected in the domestic unemployment rate.

Until the 1960s  old age and survivors’ insurance (AHV) often made it difficult for policyholders living abroad to receive old age pensions. In the case of pension funds, the portability of benefits was lacking until compulsory occupational old age provision entered into force in 1985. 

Organisations like the Association for Labour Legislation or the International Labour Organisation (ILO) acted in the interests of those affected by promoting equal rights. The tools at their disposal included studies and surveys on the circumstances of foreign workers as well as the negotiation of international agreements. In 1962, the ILO passed Convention No. 118 on the ‘Equal Treatment of Citizens and Foreign Nationals in Social Security’. Human rights likewise called for the equal treatment of citizens and foreign nationals. In 1961, the Council of Europe enacted the European Social Charter that also prescribed the ‘right to social security’ for foreign nationals. To this day, Switzerland has yet to ratify the ILO convention and the social charter; instead, the country has continued to develop bilateral social security agreements.

Bilateral immigration agreements have existed since the end of the Second World War. In the 1960s, they were renegotiated and supplemented by social insurance agreements as a result of international pressure and needs expressed by employers, which depended on both domestic and foreign workers. Thus, Switzerland negotiated agreements with countries, from where workers migrated in significant numbers. While social insurance agreements liberalised access to social security systems, the anti-immigration movement at the time caused the government to cap the number of foreign workers.

The first social insurance agreement was signed with Italy in 1962. It was accompanied by a migration agreement, the so-called 'Italian Agreement’ that was passed two years later. The two agreements resulted in improvement to children’s allowances for workers’ children left behind in Italy and granted access to unemployment insurance for Italians who stayed for at least five years. Comprehensive social insurance agreements were also negotiated with Spain (in 1969) and a number of other countries. 

The circumstances of short-term residents improved as a result of the bilateral social insurance agreements. The seasonal workers’ statute was completely abolished in 2002 as part of the freedom of movement agreement signed with the European Union. To prevent losing  claims due to migration, the Agreement on the Free Movement of Persons also regulated the coordination of social security systems. EU citizens were given equal status with Swiss citizens, liable for contributions to the same extent and given the same entitlements to social benefits. However, they could only receive social welfare benefits if they had worked in Switzerland for at least a year and possessed a valid residence permit.