Financial incentives for youth employment in Italy

Our payroll expert from Milan talks us through the recent developments in Italian payroll legislation

Businesses in Italy are set to receive new financial incentives if they employ someone registered with the Youth Employment Initiative National Operational Program.

The incentive came in to effect on 3 October 2014 and will remain in place until 30 June 2017.

The main purpose of the incentive is to kick start the European Youth Employment Initiative.

Potential employees must be aged between 15 and 29 and have compulsory schooling completed (if aged under 18) and not be currently employed or enrolled in any study or training courses.

The incentive applies to:

  • open ended hiring contracts
  • temporary hiring contracts, whose term is initially envisaged for a period of at least six months
  • temporary hiring contract, whose term is initially envisaged for a period of at least 12 months
  • part time work with working hours of at least 60% of the normal full time hours; and 
  • hiring contracts as working members of cooperatives, if appointed with a subordinate employment contract.

The incentive does not apply to: 

  • apprenticeship contracts
  • domestic work
  • intermittent work
  • job shares; and 
  • accessory work

In addition to the above, the incentive does not apply to staff leasing hiring contracts if the staff leasing agency benefits in relation to hiring contracts from remuneration for employment.

The financial amount of the incentive according to the type of hiring contract and profiling class of the employee is listed below.

Profile category of employees

LOW MEDIUM HIGH VERY HIGH
A) temporary hiring contracts (even through staff leasing) for at least 6 months 0 0 €1,500 €2,000
B) temporary hiring contracts (even through staff leasing) for at least 12 months 0 0 €3,000 €4,000
C) open ended hiring contracts (even through staff leasing) €1,500 €3,000 €4,500 €6,000

For temporary contracts lasting less than 6 months the incentive will be provided in 6 equal monthly installments.

For temporary contracts lasting over 12 months and permanent contracts the incentive will be provided in 12 equal monthly installments.

Other recent payroll news includes:

  • The Istituto Nazionale della Previdenza Sociale (INPS) announced that employees who are absent due to sickness and who wish to return to work earlier than their intended return date will only be allowed to return if a suitable medical certificate is provided by their physician. 
  • The Ministry of Transport has called for compulsory registration of company cars assigned for a period of over 30 days. This comes into force on November 3, 2014 and is only for cars assigned from this date onwards. This does not relate to companies that provide transport services or that are obliged to have a national electronic register license.
  • The Ministry of Labour has placed numerical limits on temporary contracts. The limits will be assessed by the National Collective Labour Agreement on a company’s stable workforce and any existing temporary contracts. In the event of a violation against the limit an administrative penalty will apply including the risk of not being able to stipulate new temporary contracts the following year.

This content was originally published in the TMF Milan October payroll e-newsletter

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