Employment Insights – June 2024

European labor law updates

With the monthly newsletter, Employment Insights, Andersen provides a comprehensive overview of the latest developments in labor law, judicial updates, case studies, and collective agreements in various countries. This edition includes contributions from experts in 22 European jurisdictions.

The European labor law department at Andersen comprises experienced lawyers and accountants who offer ongoing advice to national and international companies across various sectors. These professionals provide comprehensive support, intervening in disputes and offering guidance throughout the entire employment relationship, from contract formation to termination.

The Italian team of experts, led by partner Uberto Percivalle, focuses on some of the most recent and relevant updates in Italian labor law.

In this edition, the Italian team has concentrated on analyzing the measures outlined in the Cohesion Decree, which includes a series of measures aimed at boosting employment among the most disadvantaged groups through contribution relief. Additionally, they examined two important Supreme Court decisions: one concerning the protection period for a disabled employee and the other on the necessity of union mediation.

To discover updates related to other jurisdictions, we invite you to read the attached publication.

The Cohesion Decree and its measures

On April 30, 2024, the Council of Ministers approved the text of DL No. 60 “Further urgent provisions on cohesion policies,” also known as the Cohesion Decree, published in the Official Gazette on May 7, 2024. The text includes, among other things, a series of measures aimed at enhancing employment for disadvantaged groups through contribution relief.

Stay in Southern Italy 2.0 (“Resto al SUD 2.0”)

This measure promotes the creation of new businesses and the initiation of self-employment activities in Southern Italy through funding. The recipients are young people under 35 who meet certain criteria, such as marginal conditions, social vulnerability, discrimination, being unemployed, inactive, jobless, or beneficiaries of the active policy program guaranteeing the employability of employees (“Programma GOL”). The implementation of the measures will be regulated by implementing decrees.

Self-employment incentives

Article 21 of DL No. 60/2024 provides incentives for self-employment in new technologies, digital and ecological transition sectors. Unemployed individuals under 35 who start a business in these sectors between July 1, 2024, and December 31, 2025, can benefit from a 100% exemption from social security contributions (excluding national institute for work accidents (“INAIL”) contributions) for up to 3 years, for themselves and for employees hired on permanent contracts, provided the latter are under 35 at the time of hiring. The exemption is capped at € 800 per month.

Youth Grants (“Bonus Giovani”)

This measure provides that private employers who hire non-executive staff on permanent contracts, or convert fixed-term contracts to permanent ones, between September 1, 2024, and December 31, 2025, will enjoy a 100% exemption from social security contributions (excluding national institute for work accidents (“INAIL”) contributions) for up to 24 months and up to € 500 per month per employee. The benefit applies to employees under 35 who have never been permanently employed. In the regions of Abruzzo, Basilicata, Calabria, Campania, Molise, Puglia, Sardinia, and Sicily, the exemption rises to € 650 per month per employee. If a employee hired with the exemption is dismissed for justified objective reasons within 6 months of hiring, the exemption will be revoked and the benefit must be repaid.

Women Grants (“Bonus Donne”)

This measure provides a 100% exemption from social security contributions (excluding national institute for work accidents (“INAIL”) contributions) for private employers who hire disadvantaged women on permanent contracts between September 1, 2024, and December 31, 2025. The exemption lasts up to 24 months and is capped at € 650 per month per worker. Hires must result in a net increase in employment and meet EU requirements. Eligible women include:

  • Women of any age without regular paid employment for at least 6 months residing in Special Economic Zone regions (Southern Italy)
  • Women of any age without regular paid employment for at least 24 months, regardless of residence

The Special Economic Zone exemption (“Bonus ZES”)

This measure provides a 100% exemption from social security contributions (excluding national institute for work accidents (“INAIL”) contributions) for up to 24 months for private employers who hire non-executive staff on permanent contracts between September 1, 2024, and December 31, 2025. The exemption is capped at € 650 per month per worker. This incentive is reserved for private employers with up to 10 employees operating in Southern Italy (Abruzzo, Basilicata, Calabria, Campania, Molise, Puglia, Sardinia, and Sicily) and hiring workers aged at least 35 without regular employment for at least 24 months.

Suitability check in construction works

Article 28 of DL No. 60/2024 amends the rules regarding the suitability check of labor incidence on the value of construction works. Project supervisors (if appointed) or clients (in private contracts), and project managers (in public contracts), must verify this suitability before final settlement. In private contracts worth € 70,000 or more, paying the final balance without this check entails an administrative fine of € 1,000 to € 5,000 for the project supervisor (if appointed) or the client.

Protection period for disabled employees

In decision No. 11731/2024, the Supreme Court established that dismissal for exceeding the protection period may be discriminatory if the employee is disabled. The “protection period” must be part of the employer’s obligation to provide “reasonable accommodation” before dismissing a disabled employee. Applying the standard protection period to disabled employees can constitute indirect discrimination, as it does not consider the higher health risks and comorbidities they face. In cases of alleged discrimination, the burden of proof primarily falls on the employer, provided the employee presents plausible evidence of discrimination. The employer must be aware of the employee’s disability and, if the employee plausibly demonstrates discrimination, must carefully examine the reasons for illness-related absences, known disability, and balance the employee’s recovery needs with the company’s organizational requirements.

Mediation: the importance of union headquarters

The Supreme Court, in decision No. 10065/2024, ruled that mediation in a “union headquarters” must occur not only with the actual assistance of union representatives but also in a location that constitutes a true union headquarters. In the examined case, the mediation took place at the company, deemed unsuitable to ensure the absence of employer influence. Consequently, waivers and settlements made outside the mandatory venues prescribed by law can be challenged within six months.