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  1. Employment & Compensation
  2. Italy: Employment Law Newsletter | August 2025

Italy: Employment Law Newsletter | August 2025

01 Aug 2025    3 minute read
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Diversity & Inclusion

In brief

This publication features the latest developments in Italy's employment sector.


Contents

  1. New laws and regulations
    1. Renewal of the National Collective Bargaining Agreement for Executives of the Credit sector
    2. Special protection for employees who have an oncological condition
  2. Case law developments
    1. Economic penalties for unfair dismissal in small companies
    2. Intentional mother is entitled to paternity leave
    3. Disciplinary dismissal and independent relevance of the allegations

New laws and regulations

Renewal of the National Collective Bargaining Agreement for Executives of the Credit sector

On 15 July 2025, the National Collective Bargaining Agreement for Executives of the Credit sector was renewed. The new version of the agreement will expire on 31 July 2028. Among the new provisions, the following are worth noting:

  • Extension of the probationary period: According to the new agreement, extending the probationary period is no longer possible, even with the parties' mutual consent. Therefore, probation will only be allowed in the case of a new hire for a maximum duration of six months.
  • New minimum fixed annual salary: The minimum fixed annual salary for executives in the credit sector will increase to EUR 80,000 from 1 August 2025 and to EUR 85,000 from 1 January 2026.
  • Sickness leave: Executive-level employees who have a recognized disability are entitled to a period of sick leave, set by the National Collective Bargaining Agreement, increased by 50%. The minimum duration of this extended leave is 12 months and can last up to 30 months.

Special protection for employees who have an oncological condition

The Italian Parliament approved a bill that will grant job retention and paid leave rights to employees who have cancer, as well as disabling or chronic illnesses. Among the most relevant provisions, the new law provides for the following:

  • Unpaid leave for up to 24 months with job retention and the right to priority access to remote working upon returning from leave.
  • Paid leave of 10 hours per year for medical examinations and treatments (effective 1 January 2026), which also applies to employees who have a minor child affected by an oncological disease or by a disabling or chronic illness.

Case law developments

Economic penalties for unfair dismissal in small companies

The Italian Constitutional Court recently ruled that the six-month limit imposed on compensation in case of unfair dismissal of employees hired on or after 7 March 2015 in small companies (i.e., companies that do not exceed 15 employees in a production unit or within the same municipality and, in any case, do not employ more than 60 employees nationwide) is unconstitutional. The Court clarified that a small number of employees is no longer a reliable indicator of an employer's actual economic strength - particularly in a landscape shaped by the constant evolution of technology and transformation of production processes, where a small number of employees may generate substantial business activity. As a result, labor courts are now entitled to determine compensation within a range spanning from three months to the "newly" introduced maximum of 18 months (i.e., half of the 36 months that are potentially applicable to employees of big-size companies).

Intentional mother is entitled to paternity leave

The Italian Constitutional Court recently ruled that an employee who is an "intentional mother" - meaning a woman who is not biologically related to the child but part of a same-sex couple - must be entitled to paternity leave. A law providing otherwise would result in an unreasonable discriminatory treatment when compared to paternity leave granted to the working father in heterosexual couples.

Disciplinary dismissal and independent relevance of the allegations

Dismissal for just cause is lawful even when some of the allegations are dropped, as long as the remaining ones are well-founded. In a recent ruling, the Italian Supreme Court confirmed that, when a dismissal is served for just cause based on multiple allegations, each of them may be evaluated independently and constitute a sufficient basis to justify the dismissal.

Contact Information
Massimiliano Biolchini
Partner at BakerMcKenzie
Milan
Read my Bio
massimiliano.biolchini@bakermckenzie.com
Antonio Luigi Vicoli
Senior Counsel at BakerMcKenzie
Milan
Read my Bio
antonioluigi.vicoli@bakermckenzie.com

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