European Employment Insights – June 2025

European Andersen professionals from over 20 different jurisdictions have published the latest Employment Insights Newsletter, featuring key updates from the world of Employment Law. 

How artificial intelligence is reshaping the labour market

Following the Andersen Europe Employment Summit in Lisbon, Magdalena Patryas, Partner at Andersen Poland, interviewed José Mota Soares, Managing Partner of Andersen in Portugal and coordinator of the Iberian Employment team. 

José highlighted how artificial intelligence is increasingly driving the demand for new professional profiles, such as AI analysts or ethics officers, while also reshaping many traditional roles. This transformation requires workers to learn how to use AI-based tools and processes. In sectors such as manufacturing and logistics, automation and new software may pose a risk to jobs involving manual or repetitive tasks, potentially causing significant socio-economic consequences. In the Portuguese labour market, however, strong worker protections may encourage companies to favour employee reskilling over mass layoffs. 

Legislative changes ahead for employers in Germany 

Kathrin Pietras, Partner at Andersen in Germany, reported on upcoming employment and labour law reforms planned by the new German government. Among the proposals is a raise of the statutory minimum wage to EUR 15 gross per hour starting in 2026. To strengthen collective labour agreements, only bidders applying such agreements will be eligible to participate in public tenders exceeding EUR 50,000. 

Other expected changes include the possibility of distributing maximum working hours across a full workweek, which would allow daily limits to exceed 10 hours. Works councils and employee meetings will be recognised as valid if held online, and elections may also take place digitally. Furthermore, union access rights will include digital entry. Lastly, the government aims to improve conditions for people with disabilities to enter the workforce, enhancing coordination among employers, workers, and employment agencies. 

You can find the full interviews on page 6 of the newsletter. 

Employment law updates in Italy

Uberto Percivalle, Partner at Andersen Italy and head of the Employment and Labour Service Line, provided insights into recent legal and judicial developments in Italian employment law, focusing on employee participation, VAT rules on secondments, and more.

Employee Profit Sharing and Participation

Law No. 76 of May 26, 2025, introduces significant reforms in employment and tax matters. It allows employee representatives to participate in company boards of directors or supervisory boards, enhancing their involvement in business decision-making. From a tax perspective, it raises the annual income tax exemption on profit-sharing to EUR 5,000. It also permits the conversion of performance bonuses into shares, with a 50% tax exemption on dividends up to EUR 1,500. The law further establishes joint company-worker committees to support innovation, improve production processes, and work organization, through a structured consultation process. 

Revenue Agency Guidelines – VAT on Secondments (May 16, 2025)

With Circular No. 5/E, the Italian Revenue Agency clarified that secondments reimbursed at cost are now subject to VAT, even if the payment only covers the expenses incurred by the lending employer. However, unpaid secondments remain VAT-exempt, as do secondments by non-commercial entities within non-business activities. Exemptions also apply to secondments under contratti di rete (network contracts between companies) and “avvalimento” arrangements (typically used in public tenders). 

INPS Guidelines – Medical Audits for Sick Employees

INPS outlined, through message No. 1505 of May 15, 2025, the procedure for employers to request medical audits for employees on sick leave. Requests can be submitted using the dedicated “Request for Medical Audit – VMC” function on the INPS online portal. 

Sanctions for Privacy Violations on Employee Emails and Internet Use 

In its May 30, 2025 bulletin, the Italian Data Protection Authority sanctioned the Lombardy Regional Government for unlawful handling of employee data. Specifically, it found that email metadata had been stored for over 21 days without union agreement and that internet browsing data was collected without proper authorisation or limitations. 

Reasonable Accommodation Required Before Dismissing a Disabled Employee 

With decision No. 12270 of May 9, 2025, the Court of Cassation ruled that the dismissal of an employee who became unfit for work due to long-term illness is unlawful if the employer does not prove both the absence of alternative positions and the attempt to identify reasonable accommodations to retain the worker.