Additionally, for people that are taxed at source, the 13th month is disadvantageous because they pay more tax in the month of pay out.
From my professional, payroll point of view: just makes things more complex
I actually like the 'extra cash' at the end of the year, even if you know it's coming it's nice anyway!
There's a difference between having a 13th salary, and having your annual salary split in 13th.
I understood why the 2nd option exists, it's because it's only "offered" if the employee stay the entire year, meaning that if one leaves earlier, that person won't be entitled to the full 13th salary, only having a pro-rata per duration.
It's basically a way to lure you with a higher annual salary.
There are also complications for a la source people, depending on how it's calculated- At the very best case scenario, it's just confusing.
Always seemed like a daft idea, based on the assumption that people live from one month to the next on their pay packets and nothing else, whereas in reality most professional people in any event will have set aside enough for their annual tax, so would be able to use that as a temporary fund if xmas spending is really that much higher.
When I worked as a permie in the UK some decades ago it was not unusual to find companies using a 4-week accounting period, of which there were ~13 in the year, which I think was based on the earlier idea of weekly salaries, rather than annualised. It worked OK, but made monthly standing order payments more tricky.
But in this day and age does it really matter any more?
In some places (don't know about Switzerland) there are/were 2 extras, one in the Summer holidays and another for Christmas. It is somewhat clear by the timing that this uneven division of the payout is to some extent meant as an incentive to increase consumption.
I think it would be better to give incentives for people to learn how to manage their finances without "artificially" withholding a part of their salary until the periods they are "supposed" to spend it. But maybe I am just cynical.
But then, this also happens a bit with taxation at source and tax returns...
When you get into the taxation system here which puts you at an effective higher tax rate if you receive money unevenly (assuming the same annual gross amount), then the 13th salary thing just seems strictly inferior - you get a smaller net amount, AND you get it later (so you lose also on opportunity costs).
As some people mentioned before, its more for a financial planning perspective, for me it doesn't make a difference as even if I do not receive a 13th salary, I set up an automatically monthly transfer to another account which I only use for tax purposes.
Regarding the taxes, I doubt it makes a difference. Your tax bracket is usually calculated on your yearly income, not on your monthly one. If you have a 13th salary you will have a month (or two) during the year were you will pay more in taxes; if you don't, tax will be spread evenly through out the year. Anyhow, you should file a tax return at the end of the year (even if you are taxed on the source), this is not mandatory if your earnings are less than 120K per year (might be wrong about the amount) but its good to do it because usually you get something back.
Tom