Fixed-term employment agreements
The new law provides that, when fixed-term employment agreements have a duration (including extensions) between 12 and 24 months (i.e., the maximum possible duration for Italian fixed-term employment agreements) or are renewed regardless their duration, the employer must indicate a specific business need that justifies the fixed duration of the agreement. These reasons may be:
- those provided by collective bargaining agreements
- replacement of absent employees.
Only for agreements executed between 5 May 2023 and 30 April 2024 and upon condition that no rules are provided under applicable CBAs, the parties can agree in writing on other, different business needs – to be evaluated carefully on a case-by-case basis in order to minimize the risk of conversion of the employment relationship into one on a permanent basis.
Transparency obligations
The new law also simplified some transparency obligations introduced in 2022 by the so-called “Transparency Decree” (click here to read our dedicated newsletter).
In particular, when executing an employment agreement, it will be sufficient to make reference to the law and collective bargaining agreement, without the need to replicate related provisions, in topics such as: (i) professional training; (ii) duration of paid leaves and holidays; (iii) procedures, form and terms for termination; (iv) initial compensation and compensation items; (v) working hours; (vi) social security and insurance bodies. The employer is now required to make available to each employee applicable collective agreements and company handbooks.
In relation to the need to inform employees in writing on any automatized systems used for managing or monitoring the employment relationship, the new law clarifies that this obligation only applies to systems that are entirely automatized.
Tax discounts
For tax year 2023, company welfare measures granted to employees with tax-dependent children are exempted from income tax up to EUR 3,000. The same discount applies to sums paid or reimbursed for household bills. An employer who intends to benefit from these discounts must inform its works councils, if present within the workplace.
Hiring incentives for specific categories of employees
- Low-income employees: starting 1 January 2024, a new income support measure called "Inclusion Allowance" will be available. Employers hiring employees benefitting of the Inclusion Allowance are entitled to:
i. a 100% social security discount up to EUR 8.000 , for up to 12 months if the employee is hired with an open-ended employment or apprenticeship contract. Except for disciplinary dismissals, if the employer dismisses the employee within 24 months following the hiring date, it will be required to pay back all the social security contributions normally due plus sanctions
ii. a 50% social security discount up to EUR 4.000, for up to 12 months in case the employee is hired on a fixed-term basis, when certain conditions are met.
- Young workforce under age 30: starting 1 June 2023 and until 31 December 2023 employers hiring “NEET” (Not engaged in Employment, Education or Training) individuals under age 30, who are enrolled in the National Operative Program “Iniziativa Occupazione Giovani”, are entitled for 12 months to an incentive ranging from 20% to 60% of the monthly gross compensation of the employee.
Company restructuring
The new law has also changed some provisions on restructurings. The Ministry of Labour may now grant an additional period of extraordinary furlough measures (Cassa Integrazione Guadagni Straordinaria), where already granted until 31 December 2023, to companies that continue to face a crisis situation and have failed to complete, in 2022, the relevant reorganization and restructuring plans. This extension may be granted by the Ministry of Labour at the request of employers, at certain conditions but without the need for union consultations.
Health and safety
Some changes have been enacted also on health and safety matters. Amongst others, the new law:
- extends the obligation to appoint a company doctor whenever the applicable Risk Assessment Document (“Documento Valutazione Rischi”) requires so
- in order to carry out pre-hire medical checks, new provisions require the company doctor to obtain from the employee their medical file from their previous employer.
