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Latest legislative changes in the Italian labor law

  • Italy
  • Employment law

10-10-2013

Law Decree no. 76, approved on 28th June 2013, and converted with amendments by Law no. 99 of 9th August 2013 (the so called “Decreto Lavoro”), provides for first urgent actions on Italian employment matters.

According to the Italian Ministry of Labour, the measures introduced by the “Decreto Lavoro” are essentially intended for achieving five objectives:

(i)           to promote employment growth, both on fixed-term and open-ended basis, and the re-employment of the unemployed;

(ii)          to create new job and training opportunities for young people;

(iii)         to increase the protections for employers and workers;

(iv)         to strengthen labor market policies;

(v)          (iv) reduce the poverty and the gap between Northern and Southern Regions.

Please find below a brief description of the main changes introduced in employment matters.

Incentives to recruitment

Employment growth is pursued through the provision of economic and regulatory incentives to recruitment, and also through the introduction of new rules increasing flexibility in recruitment.

Of particular note is an incentive provided in favor of employers who hire on open-ended basis unemployed workers entitled to the unemployment social security indemnity (“Aspi”); the incentive will be equal to 50% of the residual monthly indemnity that would have been paid to the worker if he/she remained unemployed.

Other temporary incentives are provided, under certain conditions, in favor of employers who (by 30th June 2015) hire on open-ended bases young people aged between 18 and 29, who are unemployed for at least 6 months or have no school certificate.

Apprenticeship

Law Decree no. 76/13 introduced measures to promote youth employment and to encourage the use of professional apprenticeships. In particular, by 30th September 2013, the Standing Conference for Regions-State Relations must adopt guidelines for job training within the professional apprenticeship. In lack of the guidelines above, the following exceptions to the general rules provided by the law on apprenticeship will apply effective from 1st October 2013:

A)   the individual training plan is required only in relation to training for the acquisition of specific technical and professional skills;

B)   the record of training and of professional qualification for contractual purposes is certified in a document with the minimum contents of the so called “libretto formativo”;

C)   in case of companies with more than one offices, the employees’ training takes place according to the rules of the Region where the company has its registered office.

Job and orientation training

We also note the introduction of various rules aimed at reviving job training and orientation courses, to strengthening the chances of training and employment of young people.

Fixed-term employment contracts

With reference to the fixed term employment contract, the following changes are provided:

(i)           a fixed term employment contract without mentioning the reasons that justify the term can be entered into (besides the first fixed-term employment relationship, already provided), also in all the other cases provided for by collective bargaining agreements, even at company level;

(ii)          the term of the employment contract under point (i) above can be now extended, subject to the limit of a maximum duration of 12 months;

(iii)         the so called "stop & go" between following fixed term employment contracts returns to the original term of 10 or 20 days depending on the duration of the contract (up to 6 months or more);

(iv)         Legislative Decree no. 368/2001 does not apply to fixed-term employment contracts entered into with workers made redundant with entitlement to get the relevant indemnity.

Some rules provided for fixed term employment contract will apply also to workforce supply contracts.

Secondment of personnel

One of the new provisions introduced by the law 99/2013 which converted D.L. no 76/2013 into law, makes it clear that in case of secondment of personnel between companies that have entered into a contract for a companies’ network, the requirement of the home company’s interest in secondment is automatically met.

Job on call

Job on call is now allowed for a period of no longer than 400 days of work in 3 calendar years, the passing of which determines the establishment of an open ended full time employment relationship.

Accessory work

With reference to the accessory work, the requirement of the occasional nature of work is cancelled; therefore, today, the only limit to use this type of contract is the economic threshold of € 5,000 of compensation in the calendar year for all the clients.

Work on project

Resignations or settlement agreements providing for the termination by mutual consent from work on project contracts are now subject to the workers’ confirmation and validation, as already provided for employees.

The description in writing of all the elements required by the law for the lawfulness of a work on project contract is no longer required only for evidence reasons, but it becomes a condition for the validity of the contract.

It was also stated that the project can not involve the performance of duties merely "executive and repetitive", features that today must therefore be present together (and no longer only alternative) to exclude the use of this type of contract.

Prior procedure provided in case of dismissal for objective justified reasons

In order to eliminate some uncertainties about the obligation to follow the prior procedure provided in case of dismissal for objective reasons, D.L. no. 76/2013 clarifies that the procedure does not have to be experienced in the following cases:

A)                  dismissals for exceeding the grace period (period in which the sick employee is entitled to retain his/her job);

B)                  workers made redundant as a result of changes in service contracts which are followed by new hiring according with clauses that guarantee the continuity of employment provided for in the collective bargaining;

C)                  termination of open-ended employment relationships in the construction industry, for task completion and closure of the site.

Regularization of association in participation contacts

One of the changes introduced by the law of conversion of DL n. 76/2013 was the possibility (until last 30th September 2013) of entered into agreement with the unions for the regularization of association in participation contracts not in compliance with the provisions introduced by the so called Riforma Fornero.

Labour market policies

A special database is implemented at the Italian Ministry of Labour in order to promote a better match between employment supply and demand, taking into consideration expertise and skills.

Social Policies

With reference to the social policies aimed to reduce the poverty, the "Program for Social Inclusion" is started and special incentives for employment in the Southern Regions of Italy.

Strengthening protections for companies and workers

Further measures introduced are aimed at strengthening protections for businesses and workers. In this regard we note the increasing in penalties for breaches of provisions on health and safety at work, the extension of protection in case of forced resignations also to workers on project and workers with a association in participation contract, who will have to confirm their resignation or agreements for termination by mutual consent according to the rules already in force for employees.