Italian strategy to exit from labour emergency

Decree Law 99 of 30 June 2021 came into force on the day of its publication, completing the framework of tax and labour rules to gradually lift the emergency employment measures brought in as a response to the covid-19 pandemic.

Background

The regulatory scheme covering labour, which also includes provisions introduced by Support Decree 2 (Law Decree 73/2021), is as follows: companies belonging to the manufacturing sector that have made use of the emergency redundancy funds (provided by Decree Law 41/2021) can access a redundancy fund (CIGS), free of charge, for a further period of 13 weeks until 31 December 2021. Employers applying for redundancy funds are precluded from collective dismissals and individual dismissals for objective justification for the duration of the wage supplementation received by 31 December 2021. (Pending procedures initiated after 23 February 2020 are also suspended for the same period.)

Companies belonging to the textile, clothing, leather, fur and leather goods manufacturing sector (identified by ATECO codes 13, 14 and 15) can benefit from the redundancy fund (CIGO) free of charge for a maximum of 17 weeks between 1 July 2021 and 31 October 2021 and cannot proceed with collective and individual dismissals for objective reasons until 31 October 2021, except for in the cases below.

Employers that cannot benefit from the CIGO can use dedicated wage supplementation funds (FIS, bilateral solidarity funds or CIGD) free of charge until 31 December 2021 and cannot proceed with collective and individual dismissals for objective reasons until 31 October 2021, with the exceptions below.

Exceptions

The scenario above does not apply for the following cases provided by the previous provisions:

  • employment termination within the change of contractor ruled by law, national collective labour agreement or contract provisions;
  • redundancies connected to the definitive end of the company’s operations, including its liquidation without even partial continuation of operations (with exception of transfer of undertaking);
  • possibility of a company collective agreement to encourage termination of employment, limited to employees who adhere to this agreement; and
  • redundancies in the event of the company’s operations ending due to bankruptcy.

Prior to the enactment of Decree Law 99/2021, the prime minister and the labour minister signed a joint notice executed by National Union and Employers’ Associations (CGIL, CISL, UIL, Confindustria, Alleanza delle Cooperative, Confapi), according to which the social parties, in light of the solution proposed by the government to overcome the suspension of dismissals, undertake to recommend the use of the available alternatives to the termination of employment.

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