Employment Law Updates: 5 things to know about Italy’s latest measures aimed at reducing the social and labor impact of Covid-19
In this issue:
- Extension of the salary integration programs.
- Extension of the termination ban.
- Employees more susceptible to COVID: absences, sick leave and vaccine.
- Easier access to the New Social Insurance for Employment (NASpI).
- Extension of the possibility to renew/extend fixed-term employment contracts
Law by Decree No. 41/2021, issued on March 22, 2021 (the “Sostegni Decree”, i.e. the “Supporting Decree”)
1. Extension of the salary integration programs.
Employers can now request additional weeks of governmental salary integrations to help them through the ongoing Covid emergency. These salary integrations are only applicable to employees that were in force as of March 23, 2021 and can be requested free of charge. (Art. 8 of the Sostegni Decree)
More specifically, companies can request:
- 13 additional weeks under the ordinary salary integration program (“Cassa integrazione guadagni ordinaria” or “CIGO”) to be used between April 1, 2021 and June 30, 2021; or
- 28 additional weeks under the FIS ordinary allowance program (“Assegno ordinario FIS”) and the special salary integration program (“Cassa integrazione guadagni in deroga” or “CIGD”) to be used between April 1, 2021 and December 31, 2021.
The Sostegni Decree differs from previous Covid emergency legislation, in allowing the new 28 weeks of special salary integration to be added with those 12 already requested and which were to be used from April 1, 2021 under previous provisions (i.e., Law no. 178/2020).
The Sostegni Decree also differs from previous Covid emergency legislation in that it does not provide for a partial exemption from social security contributions for those employers who do not request governmental salary integrations.
2. Extension of the termination ban.
Collective redundancy procedures and individual terminations for objective reasons (i.e., dismissals related to the organization and management of the business) are prohibited until June 30, 2021. (Art. 8 of the Sostegni Decree)
This termination ban is further extended from July 1, 2021 to October 31, 2021, for those employers who are eligible for the non-ordinary salary integration programs specifically introduced for facing the Covid-19 pandemic.
In any case, starting from November 1, 2021, the termination ban will no longer be in effect for all employers.
Lastly, this termination ban continues not to apply in the following cases:
- permanent termination of the business activity due to liquidation of the company;
- bankruptcy without temporary exercise of the business;
- bankruptcy with temporary exercise of selected business branches, but only in relation to employees who are not part of such temporarily active branches;
- execution of a collective agreement with the national trade unions to offer incentives for the voluntary termination of employment contracts, but only in relation to the employees who agree to sign a voluntary termination agreement.
3. Employees more susceptible to COVID: absences, sick leave and vaccine.
Until June 30, 2021, employees who are certified as gravely handicapped and employees who have certified medical conditions that make them more susceptible to COVID (i.e. being immunocompromised), will be eligible to fulfil their duties in smart working whenever possible, even if to do so they will need to be assigned to different duties within the same job level. (Art. 15 of the Sostegni Decree and Art. 26 of Law by Decree no. 18/2020)
In case smart working is not possible, these “vulnerable” employees will be considered to be on sick leave, but the duration of this sick leave will not be counted for the purpose of calculating the 180 days of sick leave after which the employer can terminate the employment contract (“Periodo di comporto”). (Art. 15 of the Sostegni Decree)
4. Easier access to the New Social Insurance for Employment (NASpI).
The New Social Insurance for Employment (“NASpI”) is the current unemployment indemnity provided under Italian legislation.
Normally, to be eligible for NASpI, one must meet the following requirements: (i) being currently unemployed; (ii) having accrued at least 13 weeks of social security contributions in the last 4 years before unemployment; (iii) having accrued at least 30 days of “effective work” in the 12 months before unemployment.
The Sostegni Decree provides that from March 23, 2021 to December 31, 2021, the third NASpI requirement will not be applicable and, therefore, the monthly unemployment indemnity will also be accessible to those who did not “effectively work” at least 30 days during the last year, possibly because of their suspension under any available salary integration program. (Art. 16 of the Sostegni Decree)
5. Extension of the possibility to renew/extend fixed-term employment contracts.
Through December 31, 2021, companies can renew or extend fixed-term employment contracts one more time for a maximum period of 12 months, without regard for the normal limitations on such extensions or renewals, provided that the total duration does not exceed 24 months. (Art. 17 of the Sostegni Decree)
Normally, a fixed-term employment contract can be extended or renewed only in the presence of one of the following reasons:
- for temporary and objective needs which are external to the ordinary business of the company;
- to replace other absent employees;
- for needs related to temporary, significant, and unforeseeable increases in the ordinary business of the company.