Basic rules regarding rights and obligations of employer-employee relationship in Italy can be found in the Constitution, the Civil Code (“Codice Civile”) which includes a special section on employment matters, and the Workers’ Statute (“Statuto dei Lavoratori”), i.e. Law no. 300/1970 as modified by subsequent legislation. Terms and conditions of employment are also fixed by national collective agreements (“NCAs”, “Contratti collettivi”) signed periodically between the trade unions and the employers’ associations of the same business sector. These collective bargaining agreements usually regulate the working conditions and establish the minimum wage and salary scales for each particular sector.

Employment contracts are governed by the general rules set out in the Civil Code. 

Given the existence of a large number of NCAs and their extensive use by the employers, employment agreements in Italy normally consist of simple hiring letters which refer to the items required by the law including identity of the parties, place of work, employment start date, trial period (if any), duration of the employment (in case of fixed-term employment) and enrollment, employee’s duties and to the provisions set forth by the applicable NCAs. Individual employment contracts also specify the employee’s “category” as established by the Civil Code, under article 2095. There are four categories of employees: 

• executives (“Dirigenti”); 

• middle managers (“Quadri Intermedi”); 

• employees (“Impiegati”); 

• workers (“Operai”). 

Despite the fact that national collective agreements normally define general principles that regulate the employment relationship of Dirigenti, general and specific conditions are often negotiated through individual agreements. Quadri are defined as employees who, while non-top executives, are continuously engaged in duties that contribute significantly to promoting the company’s growth and achieving its goals. According to a limited number of collective agreements, employers are required to insure quadri against claims for negligence brought by third parties. 

At the beginning of the employment relationship, the employer must inform the employee of the main terms and conditions of his/her contract.

Italian law does not provide any particular form for employment contracts; they may be communicated orally, although most contracts are proven in writing. Having said that, some specific provisions as well as specific information concerning the employment relationship are required by law to be in writing (for example: trial period, non-compete clause, fixed term, if any). Also, certain types of contracts are required by law to be in writing (for example: part-time contracts). 

Employment contracts can be agreed upon in any language, provided that both parties are able to fully understand the content of any provision therein. The age of majority is 18 years old. The minimum age required for validly entering into an employment relationship is 16 years old with the worker’s parents’ consent (15 years old for apprenticeships contracts).

Formal fulfillment 

Upon the establishment of any employment relationship, the employer must notify the competent public employment service (“Centro per l’Impiego”) at least 24 hours prior to commencement. This notification also fulfills the obligation to notify the relevant social security institutions (i.e. INPS and INAIL). If mandated by law, the employer must also stipulate insurance policies against risks and damage suffered by third parties caused by employees fulfilling their employment duties. 

Trial period

The statutory trial periods are the following: 

• 3 months, for employees not assigned to managing functions; 

• 6 months, for all other employees. 

However, the probation period is commonly set in the relevant NCAs depending on the category/level of the employee. During the trial period, either party may freely terminate the working relationship at any time, without any notice, obligation or payment of the relevant indemnity in lieu. 

Labor Cost

Italian law does not provide for any statutory measure of “wages” and “salary”. For income tax and social security purposes, any compensation granted to the employee within the scope of the employment relationship, including compensation in kind, is considered wages (this does not include a few limited exceptions, such as expenses reimbursement). 

There is no statutory minimum wage in Italy. Minimum wages for each contractual level are usually set forth by the relevant national collective agreements (NCAs). A minimum wage is being introduced for workers not currently covered by NCAs, although they account for less than 3% of the total workforce. 

There are no statutory bonuses. NCAs may provide for collective performance bonus (“premi di risultato”) or individual performance bonus. There are no statutory allowances, although NCAs provide for transportation allowances or indemnities for certain working arrangements such as on-call work.

Under Italian law, compensation is granted in thirteen (13) monthly installments. The additional 13th installment (“tredicesima”) is paid out each year along with the December salary. 

Some NCAs provide for a 14th monthly installment, normally paid in June. 

The NCAs also normally set the payment date and the calculation basis of the contractual items (e.g. notice period, compensation during illness). 

Employers frequently grant certain employees fringe benefits (for example: a company car and mobile phone to top/middle management and sales positions, luncheon vouchers and internal or external training and education). Employers are required to fund severance payments for all employees (“Trattamento di Fine Rapporto - TFR”), amounting to 1/13.5 of the annual overall compensation, payable on termination of employment for any reason.

Working hours

Executives are not subject to the rules governing working hours. Some NCAs provide for a working week of less than 40 hours. Employees must be granted at least one weekly rest day (normally on Sunday).

Exceptional and temporary business activities may need employees working on weekly rest days or legal holidays. 

Overtime work is considered as the hours worked exceeding the 40 hours per week and may not exceed 8 hours on a weekly basis and 250 hours on a yearly basis. NCAs set specific additional rates to be applied to overtime work and can also replace overpay with additional rest days.

Hybrid Working

Hybrid work is considered as a flexible work model that supports a blend of in-office, remote, and on-the-go workers. It offers employees the autonomy to choose to work wherever and however they are most productive. People who work in a hybrid mode are entitled to the same rights as employees performing the same tasks and duties at the company’s premises, including with respect to training and career opportunities. 

Full Remote working

Remote working is considered as “a way of implementing an employment relationship” carried out in part at the premises of the company and partly at a different location, without a fixed workplace, but within a maximum duration limit of the daily and weekly work hours established by law and the collective bargaining agreement. Remote working must be agreed upon in writing, also through organization by phases, cycles and objectives, with the possible use of technological means to carry out the working activity. The general regulatory framework concerning employees working from home can mostly be found in several NCAs. More specific rules may be agreed at local and/or company level.

Full remote workers are individuals who work remotely and for this reason they are not based in a centralized office location. The full remote working policy must outline the several and different aspects of this specific mode and may be different for every company. It offers employees the autonomy to choose to work wherever and however they are most productive. People who work in a full remote working mode are entitled to the same rights as employees performing the same tasks and duties at the company’s premises, including with respect to training and career opportunities.

EU/EEA and Swiss nationals

According to the principle of free movement of persons, goods, services and capital, EU (European Union) and EEA nationals can be employed in Italy without any authorization by the Italian authorities being required.

 Should an EU national choose to work in Italy for a period in excess of 3 months, he/she should apply for a so called “Stay card” (“Carta di Soggiorno”), which is normally issued by the local State Police office (“Questura”) upon a simple request. This permit is renewable. Swiss citizens have the same right of entry, residence and access to work applicable as EU countries nationals.

Non EU/EEA nationals - the quota system

The admission of non-EU foreign workers is subject to a mechanism of quantitative selectivity based on quotas for new entries on a yearly basis.

 They are meant to regulate the admission of third country nationals and their access to the Italian labor market, by combining a purely quantitative selectivity with some elements of qualitative selectivity. 

The determination of annual quotas of new inflows is established by the government, which sets the quota through a Prime Minister Decree (known as “Decreto Flussi”). The quota decree is published in the Italian Official Journal and starts some days after the implementation phase. 

The whole implementation process of the quota system is basically made up of three main steps: 

•  authorization requests presented by employers to the Immigration Single Desk (ISD); 

• visa request by prospective migrants in their country of origin; 

•  request and delivery of the stay permit for working purposes

Check our guide “Doing Business in Italy” to know more about:

• Authorization (“nulla osta”) request

• Visa issuance

• Stay permit (“permesso di soggiorno”) issuance

• Exemptions - extra-quotas entries

• Visas for investors

Since 2021, Italy has been committed to implementing legislation to encourage the creation and growth of new innovative companies with high technological value. Italy aims at promoting technological development and employment, especially youth, and encouraging the attraction of talent in our country. 

The Italia Startup Visa program promotes the achievement of these objectives by introducing a simplification mechanism in the process of granting visas for self-employment for the benefit of Non-Visa EU citizens that intend to start an innovative startup in our country. The new procedure is fully centralized and telematized, as well as strongly accelerated, leading to the issuance of the visa within 30 days. With the Italia Startup Hub program, this opportunity is also extended to non-EU citizens who already live in Italy and hold a regular residence permit and intend to remain even after the deadline to start an innovative startup: in this way they can convert their residence permit (e.g. for study) in a residence permit for self-employment startup without having to leave the Italian territory.

Discover more on how to apply for a Startup Visa on Startup Visa - Ministry of Economic Development

Part-time contract 

Part-time employment contracts must be in writing and specify the working hours (e.g. by day, week, month and year).

Pay and other entitlements of part-time employees are normally pro-rated to those applicable to full-timers performing the same duties. 

Ancillary clauses to part-time contract can be added, which allow employer a wider flexibility: 

• so-called “elastic clauses” (clausole elastiche) that allow the employer to increase working time; 

• so-called “flexible clauses” (clausole flessibili) that allow the employer to vary working hours during the day, week, year. 

Fixed-term contract (legislative decree no.81/2015) 

Employers can hire employees on a fixed term basis for arrangements limited by time.

Fixed-term contracts can last up to 24 months, including any extension.

Quantitative limits are normally set forth by NCAs; alternatively, law provides that the overall number of fixed term contracts may not exceed the 20% of the work- force hired on a permanent basis. 

Fixed term contracts cannot be used to replace workers on strike or employees temporarily included in workers’ furlough (“Cassa integrazione guadagni”) or involved in collective dismissals in the past few months.

“On call” jobs (“lavoro a chiamata o intermittente” legislative decree no.81/2015) 

“On call” job contracts provide that an employee declares his/her availability to work over a certain period of time, during which he/she can be called in - even for a few days only - with short-term notice. 

The individual contract may provide that the employee is bound to work if called by the employer. In this case, in addition to the normal remuneration paid for the working activity actually carried out, the employee may be entitled to an additional 20% of the wage set by the NCAs. This contract must be agreed upon in writing.

• Apprenticeship (“apprendistato”, legislative decree no.81/2015)

• Staff supply contract (“contratto di somministrazione di lavoro”)

• End of employment

• Collective dismissals

• Safety at workplace in Italy

•  Labor proceedings

• Employee representation bodies & Employee participation

• Social security and assistance system

• Employment incentives

• Productivity bonus