European Employment Insights – November 2025

European Andersen professionals from over 20 different jurisdictions have published the latest Employment Insights Newsletter, featuring the main updates in the field of Employment and Labor Law.

BOSNIA AND HERZEGOVINA: RECORD INCREASES IN THE MINIMUM WAGE AND NEW CHALLENGES FOR LABOR LAW

Magdalena Patryas, Partner at Andersen Poland, interviewed Sanja Đukić, Senior Partner at Andersen Bosnia and Herzegovina, to analyze the most significant labor law updates, including the minimum wage increases introduced in the country and their direct consequences on the labor market.

In 2025, a significant increase was introduced: on the one hand, the Federation of Bosnia and Herzegovina raised the minimum wage from BAM 620 (approximately €320) to BAM 1,000 (approximately €510); on the other hand, Republika Srpska replaced the previous universal minimum wage of BAM 900 net (approximately €460) with a differentiated minimum wage system based on the level of education, following a four-tier model linked to the qualifications required for the position.

The aim of this initiative was to curb worker emigration and improve living standards. Trade unions viewed the measure as a useful tool to reduce undeclared work and unreported wages. However, employers expressed concerns about the increased cost of labor, particularly due to the impact of social security and health contributions.

The Federation of Bosnia and Herzegovina therefore sought to support employers by reducing the contribution burden from 10.5% to 5%, while Republika Srpska did not introduce similar relief measures.

The new measures led to an increase in employment in the Federation, but to a decline in employment in Republika Srpska, particularly in the industrial and mining sectors.

Unfortunately, the minimum wage policy has had only a partial effect: many employers have modified job descriptions, lowering the required level of education.

The government has already announced a further increase in the minimum wage for 2026, which will raise the net minimum wage to BAM 1,100 (approximately €560) for positions requiring a high school diploma and to BAM 1,400 (approximately €715) for those requiring a university degree.

At the same time, new legislation is being prepared in the Federation of Bosnia and Herzegovina to better protect workers, such as promoting open-ended contracts, counting breaks as working time, and increasing paid leave days. Overall, the new rules move toward greater employee protection, despite the country’s challenging economic context.

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

EMPLOYMENT LAW UPDATES IN ITALY

Uberto Percivalle, Partner at Andersen Italy and Head of the Employment and Labor Service Line, addressed the latest developments in Italian labor law, including voluntary resignations by working fathers with children under the age of three and the non-extension of the deadline for withdrawing a dismissal in cases where pregnancy is disclosed.

Planning of immigration quotas for the period 2026–2028

On 15 October 2025, the Prime Minister’s Decree defining immigration quotas for the programming of entry flows, both seasonal and non-seasonal, for the years 2026–2027–2028 was published. The decree is based on the adoption of various criteria, including country of origin and the economic sectors concerned.

Resignations by employees with children under the age of three must be validated even during the probationary period

The Ministry of Labor clarified that the obligation to validate resignations submitted by employees with children under the age of three also applies during the probationary period. The Ministry confirmed that this validation requirement extends to resignations tendered during probation, meaning that employers cannot rely on resignations submitted without complying with this formality.

No VAT refund for service contracts reclassified as unlawful supply of labor

The Italian Revenue Agency issued Resolution No. 50 concerning the tax implications of reclassifying service/works contracts (“contratti d’appalto”) as unlawful supply of labor. According to the Revenue Agency, where a transaction is found to be fraudulent and reclassified accordingly, the supplier is not entitled to claim a refund of the VAT previously paid to the tax authorities. This position adds to the already significant employment, tax, and criminal law consequences associated with non-genuine service contracts that effectively conceal the supply of labor.

Deadline for withdrawing a dismissal not extended by the disclosure of pregnancy

The Court of Cassation ruled on a case in which a pregnant employee challenged her dismissal without initially disclosing her pregnancy. The employer did not withdraw the dismissal within the 15-day statutory deadline, but only did so later, once informed of the pregnancy. The lower courts had rejected the employee’s claim to declare the dismissal null and void and to award damages, considering the withdrawal timely as it was made upon learning of the pregnancy.

The Supreme Court reaffirmed the principle that the 15-day deadline for withdrawing a dismissal always runs from the moment the dismissal is first challenged, even where pregnancy has not been immediately disclosed. According to the Court, this is necessary to ensure certainty regarding the time limit within which the employer may exercise the right of withdrawal.

Employers applying multiple collective bargaining agreements

The Court of Cassation held that where an employer has undertaken to apply a specific collective bargaining agreement, it may not breach that obligation, even by subsequently joining another employers’ organization and committing to the application of a different collective agreement. Where an employer is affiliated with multiple employers’ associations that have entered into different collective agreements, the decisive criterion for identifying the applicable agreement is the actual activity performed by each group of workers. In the event of a conflict, the collective agreement corresponding to the activity actually carried out by each individual employee must therefore be applied.