Basic Information

Social Contribution

Employer Contribution

In the Italian social security contribution system, the specific items and rates of employer contributions are influenced by factors such as employee qualifications, job nature, and company size. For reference: IMPEIGATI (white-collar employees) level—employer cost approximately 42.25%; QUADRI (middle managers) level—employer cost approximately 49.42%; DIRIGENTI (executives) level—employer cost approximately 63.03% (including a 7.41% severance pay).

Employee Contribution

Generally, the proportion of employee costs to taxable salary ranges from 9.19% to 11.49%. However, the costs borne by employees in Italy vary depending on their classification (worker, executive, or manager) and the nature of the employer's business (manufacturing, trade, tourism, etc.).

Personal Income Tax

(Reference, subject to industry specifics)

Payroll

Payroll Cycle

Monthly salary payments。

13 Salary

According to the CCNL collective agreement, employees receive a 13th and 14th salary. The 13th is paid with the 12th month's salary, and the 14th is usually paid in June. Currently, both are distributed monthly with regular salaries.

Working Time

Standard Working Hours (full time)

According to industry collective agreements and contracts, full-time employees generally work 40 hours per week.

Overtime

Work beyond 40 hours per week is considered overtime, with a maximum of 8 hours per week and 250 hours per year. Exceeding 48 hours per week requires authorization from the Ministry of Labor. Overtime pay, as per the CCNL, ranges from 115% to 150% and varies by industry.

Holidays

Public Holidays

Italy has 11 public holidays.

Annual Leave

Employees are entitled to at least 26 working days of paid annual leave (including Saturdays). Leave must be used within the year, with at least two weeks taken then; the remaining two weeks must be used within 18 months. Unused leave expires if not taken and cannot be converted to cash, except upon termination. Upon termination, unused leave is paid based on: one month's salary / 26 days * remaining leave days.

Sick Leave

In a calendar year, statutory sick pay is provided for up to 180 days. Employers must fully pay for the first 3 days of sick leave. For days 4 through 21, sick pay is 75% of the salary (50% from the government and 50% from the employer). From day 21 onward, employees receive 100% of their salary (34% from the employer and 66% from the government). If an employee takes sick leave more than twice a year, pay for the first 3 days of the third sick leave drops to 66% of the salary, to 50% for the fourth, and is zero for any further sick leave.

EX FESTIVITA

The collective agreement grants employees 32 hours of EX FESTIVITA per year for the first two years. Employees can use this time as needed or request cash payment. Unused hours can be carried over to the next year but expire if not used by year-end. There are no restrictions on how EX FESTIVITA is taken.

Riduzione Orario Lavorativo

The collective agreement specifies that ROL is available only to employees who have been employed for more than 2 years (starting from the third year), entitling them to 36 hours of ROL per year. Employees with over 4 years of service (starting from the fifth year) are entitled to 72 hours of ROL per year. ROL can be taken in hours or as a full day.

Maternity Leave

Female employees are entitled to 5 months of paid maternity leave, which can be taken 2 months before and 3 months after childbirth. In special cases, it may be adjusted to 1 month before and 4 months after. During maternity leave, mothers receive 100% of their salary, provided by the Italian National Social Security Institute (INPS). Female employees cannot be dismissed from pregnancy until one year after childbirth. To qualify for maternity leave in Italy, women must be employed and have worked for a minimum of 13 weeks. However, self-employed women or those with partner insurance may also qualify even with shorter work periods.

Paternity Leave

Fathers are entitled to 10 days of paid paternity leave within 5 months of childbirth, or 20 days for multiple births. They may also take 1 day of unpaid leave, which becomes paid if the mother relinquishes a day of her maternity leave. During paternity leave, fathers receive 100% of their salary from INPS. Maternity leave can be converted to paternity leave if the mother dies or is seriously ill, abandons the child, or if the court grants the father full custody.

Parental Leave

Parents can take up to 11 months of parental leave within 12 years of childbirth, with 30% pay. Leave can be taken by either or both parents but cannot exceed 11 months in total, or 10 months for single parents.

Bereavement Leave

In Italy, bereavement leave is a form of paid leave granted for the death of close family members. The duration of leave depends on the relationship to the deceased: spouse or cohabitant—3 days; child, parent, sibling, and in-laws—3 days; grandparents, grandchildren, aunts, uncles, nieces, and nephews—2 days; other relatives—1 day.

Labor Contract

Labor Contract Type

Labor contracts are divided into fixed-term contracts and permanent contracts.The total term of the former, including renewals, shall not exceed 1 year, the number of renewals being determined by the applicable collective agreement. For DIRIGENTI employees, this restriction may be relaxed depending on individual circumstances and collective agreements.

Probation Period 

Typically, probation periods for non-managerial employees cannot exceed 3 months, while for managerial positions, the maximum is 6 months, as determined by the applicable collective agreement.

For permanent contracts:

Manager and First Level: maximum probation period of 6 months.

Second and Third Level, Fourth and Fifth Level: maximum probation period of 60 days.

Sixth and Seventh Level: maximum probation period of 45 days.

For fixed-term contracts:

The probation period for a 1-year fixed-term contract is generally set at 30 days.

Termination

Notice Period

During the probation period, no notice is required for termination or resignation of fixed-term contracts. After the probation period, the notice period is defined by the applicable national collective bargaining agreement.

Dismissal Process

During the probation period, either party can terminate the contract without notice, reason, or compensation. After the probation period: 

For fixed-term contracts, neither party can terminate the contract without fault.

For permanent contracts, termination without fault requires a valid reason. The contract can also be terminated by mutual agreement.

Severance Pay

Regardless of resignation or termination, severance pay (TFR) must be provided. It is calculated as the annual salary divided by 13.5, multiplied by years of service.