Employer of Record Guide in 

Italy

Annual Leave (Ferie)

• Minimum Entitlement: 4 weeks (20 working days) per year
• Accrual: Typically earned monthly (1.67 days per month)
• Timing: Employer can determine timing, but at least 2 weeks must be consecutive
• Payout: Must be taken; monetary compensation only allowed upon termination

Sick Leave (Malattia)

• Duration: Up to 180 days per year (extendable in some cases)
• Compensation:
  • Days 1-3: Employer pays (rate varies by CCNL)
  • Days 4+: INPS pays 50% of salary (66.66% from day 21)
• Medical Certificate: Required from day 1

Maternity Leave (Congedo di Maternità)

• Duration: 5 months total (2 months before birth, 3 months after)
• Alternative: 1 month before birth, 4 months after (with medical approval)
• Compensation: 80% of salary paid by INPS
• Job Protection: Position guaranteed upon return

Parental Leave (Congedo Parentale)

• Entitlement: Up to 10 months per family (6 months per parent maximum)
• Timing: Until child reaches 12 years old
• Compensation: 30% of salary for first 6 months (if taken before child turns 6)
• Flexibility: Can be taken in blocks or individual days

Other Statutory Leave

• Bereavement Leave: 3 days for death of spouse, children, parents, or siblings
• Marriage Leave: 15 days for employee's wedding
• Study Leave: Right to time off for education (varies by CCNL)

Summary

Termination Types

Dismissal for Just Cause (Licenziamento per Giusta Causa):

• Immediate termination without notice
• Requires serious misconduct (theft, violence, gross negligence)
• No severance pay required

Dismissal for Justified Reason (Licenziamento per Giustificato Motivo):

• Subjective: Employee-related reasons (poor performance, misconduct)
• Objective: Business-related reasons (economic difficulties, restructuring)
• Notice period required

Notice Period Requirements

Notice periods are typically governed by CCNLs and vary by:

• Length of service
• Job classification level
• Industry sector

Common Notice Periods:

• Blue-collar workers: 1-2 months
• White-collar workers: 2-4 months
• Managers: 4-6 months

Writer Note: Please verify specific notice periods by sector and classification level as these are detailed in individual CCNLs.

Severance Pay (TFR - Trattamento di Fine Rapporto)

• Calculation: Approximately one month's salary for each year of service
• Accrual: 1/13.5 of annual gross salary, revalued annually
• Payment: Due upon termination regardless of reason
• Timing: Must be paid by the 7th day of the following month

Probationary Periods

• Duration: Varies by CCNL (typically 1-6 months)
• Termination: Either party can terminate without notice or severance during probation
• Limitations: Cannot be extended or renewed

Legal Protections

Article 18 (Workers' Statute): Provides strong protection against unfair dismissal for companies with:

• More than 15 employees nationally, or
• More than 5 employees in a single location

Protected Categories: Enhanced protection for pregnant women, union representatives, and workers on sick leave.

National Public Holidays

Variable Holidays:

• Easter Monday (date varies)
• Patron Saint Days (varies by municipality)

Regional Variations

Each municipality celebrates its Patron Saint Day as a local public holiday. Major examples:

• Rome: St. Peter and Paul (June 29)
• Milan: St. Ambrose (December 7)
• Naples: St. Gennaro (September 19)

Holiday Pay Rules

• Entitlement: All employees entitled to holiday pay
• Rate: Normal daily wage
• Working on Holidays: Additional premium pay (rates vary by CCNL)

Required Documentation

Employment Contract Elements:

• Job title and description
• Salary and benefits
• Working hours and location
• Probationary period
• Notice periods
• Applicable CCNL reference

Government Forms:

• Tax Code (Codice Fiscale): Required for all employees
• Social Security Registration: INPS enrollment
• Workplace Safety Training: Mandatory for all positions

Work Authorization

EU Citizens: Right to work without permits Non-EU Citizens: Require work permits (Permesso di Soggiorno per Lavoro)

Writer Note: Please verify current work permit requirements and processing times for non-EU nationals.

Legal Compliance

Mandatory Registrations:

• Libro Unico del Lavoro: Employee registry book
• INPS/INAIL: Social security and workplace insurance
• Workplace Safety: Risk assessment and training documentation

Data Protection

GDPR Compliance: All employee data handling must comply with EU General Data Protection Regulation and Italian privacy laws.

Implementation Timeline

Worker Classification

Employee vs. Contractor Distinction: Italian law strictly regulates worker classification to prevent "false self-employment" (falso lavoro autonomo).

Key Factors:

• Subordination: Level of employer control and direction
• Continuity: Regular, ongoing work relationship
• Integration: How integral the work is to business operations
• Economic Dependence: Reliance on single employer for income

Risks: Misclassification can result in significant penalties, back payments of social contributions, and conversion to permanent employment.

Collective Bargaining (CCNLs)

Italy's labour relations are heavily influenced by National Collective Labour Agreements (Contratti Collettivi Nazionali di Lavoro):

• Coverage: Over 90% of Italian workers covered by CCNLs
• Scope: Determine minimum wages, working conditions, and benefits by sector
• Hierarchy: CCNL terms generally override individual contract terms
• Updates: Regularly renewed through negotiations between unions and employer associations

Writer Note: Please verify which CCNL applies to specific roles, as this significantly impacts employment terms.

Cultural Workplace Norms

Communication Style:

• Formal business relationships initially
• Hierarchy and titles respected
• Personal relationships important for business success

Work-Life Balance:

• Long lunch breaks common (1-2 hours)
• August vacation period widely observed
• Family commitments generally respected

Remote Work Framework

Smart Working (Lavoro Agile):

• Legally recognised since 2017
• Requires written agreement between employer and employee
• Must maintain same salary and benefits as office-based work
• Right to disconnect legislation applies

Cross-Border Considerations:

• Tax residency implications for remote workers
• Social security coordination within EU
• Compliance with both Italian and home country regulations

What Borderless AI Handles

When you hire through Borderless AI in Italy, we manage:

• CCNL compliance and wage determination
• INPS/INAIL registration and contributions
• Employment contract preparation in Italian
• Ongoing labour law compliance monitoring
• TFR calculation and management
• Local payroll processing and tax withholding