HR Software for Italy

Leave Policy

Maternity Leave

Pregnant employees are entitled to five months of paid leave. 60 days of this must be taken before the birth of the child. During this period, the employee receives 100% of her salary, 80% is paid by social security and 20% by the employer.

The employee cannot extend maternity leave, but she can take parental leave.

You can use the leave module in IceHrm to manage maternity leave in Italy.

Paternity Leave

Employees are entitled to 11 months of parental leave, which can be taken until the child is 12 years old. Both parents can decide how to divide the leave that should be taken after paternity and maternity leave.

Both parents can take parental leave. Social Security (INPS) pays 30% of salary during this period.

Parental leave cannot be extended.

Sick Leave

Employees are entitled to up to 180 days of paid sick leave. Depending on the duration, this vacation is paid at different rates and by different payers:

Period	Pay	Payer
0 – 3 days	100% of base salary	Employer
4 – 180 days	70% of base salary	Social Security

Pay & Tax

Minimum Wage Requirements

There is no legal minimum wage in Italy.

Individual Income Tax

Personal income tax ranges from 0% to 43%. Income tax is calculated according to a progressive rate. Several additional factors can affect overall rates, such as: the household status and the number of children.

Gross Annual Income	Tax Rate (%)
Up to EUR 15,000	23%
Up to EUR – 28,000	27%
Up to EUR – 55,000	38%
Up to EUR – 75,000	41%
Over EUR – 75,000	43%

Payroll Cost

The cost to the employer is generally estimated at 38% of the employee’s salary. For workers classified in the “conductor” category, an additional estimated amount of EUR 1,341.84 must be paid.

Social Security – 23.81%
National contribution to sick pay – 2.44%
National contribution to maternity benefit – 0.24%
Severance pay fund (TFR) – 6.91%
Guarantee payment of the severance payment fund (TFR) – 0.20%
Unemployment insurance – 1.61%
Workers’ compensation insurance (INAIL) – 0.40%
Subsidy to the holiday fund (FIS) – 0.53%
Subsidy to the holiday fund (CIGS) – 0.60%
Family allowance (CUAF) – 0.68%
13th Salary – 8.33%
14th Salary – 8.33%

Please note: The 13th and 14th salaries are paid monthly and are included in the employee’s gross annual salary.

One-off costs

Pre-employment medical examination – EUR 119
Health and safety training – EUR 42
Health and safety training (English) – EUR 54

Additional costs for conductor employees

Private pension provision – Fondo Mario Negri – EUR 634.70
Additional private pension – Fondo Mario Negri – EUR 132.76
Supplementary health insurance – Fondo Mario Besusso – 5.81% + 2.56% of 3,828.33
Private pension – Fondo Pastore – 358 EUR
Tertiary Management Training Fund – EUR 24

Overtime Pay & Maximum Hours

The standard working hours are 8 hours per day and 40 hours per week. Standard working hours are Monday to Friday.

Pay for overtime is mandatory. Hours outside of standard working hours are considered overtime. An employee can work a maximum of 250 hours of overtime per year. Employees receive compensation for additional hours.

150% of the hourly rate for the first 8 hours.
200% of the hourly rate for the following hours.
150% of the hourly rate for overtime at night outside of regular working hours (from 10 p.m. to 6 a.m.)
130% of the hourly rate on public holidays and Sundays.

Directed employees are not entitled to overtime pay.

Termination

Termination Requirements

Dismissals must take into account complex rules and the regulations of the country in which an employee is employed. Off-boarding is always carried out by the employer with the main participants. It may include ad hoc fees as well as required or recommended steps for specific termination cases.

Layoffs in Italy can be complex. In exceptional cases, employers in Italy may terminate at their discretion outside of the probationary period, and generally the termination must be for a valid reason.

Proper terminations are:

Voluntary by the employee
By mutual agreement
Unilaterally by the employer due to:
1. Probationary period
2. Objective reasons
3. Dismissal for disciplinary reasons
4. Without reason (exceptional cases)
When the contract expires

Notice Period

The notice period is at least 30 days and increases depending on the duration of the employment relationship, the category of employee and the type of termination.

Termination by the employee – senior employees (Quadri and Level I)

45 days with employment of up to 5 years
60 days if you have been with the company for more than 5 years and up to 10 years
90 days if you have been with the company for more than 10 years

Termination of the employment relationship by the employee

20 days with employment of up to 5 years
30 days if you have been with the company for more than 5 years and up to 10 years
40 days if you have been with the company for more than 10 years

Termination by the employer – senior employees (Quadri and Level I)

60 days with a seniority of up to 5 years
90 days if you have been with the company for more than 5 years and up to 10 years
120 days if you have been with the company for more than 10 years

Termination of the employment relationship by the employer

30 days with a seniority of up to 5 years
45 days with seniority of more than 5 years and up to 10 years
60 days if you have been with the company for more than 10 years

Severance for Employees

In Italy there are no severance payments or redundancy payments as such. However, upon termination of the employment relationship, the employee receives the so-called TFR (Trattamento di Fine Rapporto), a part of the salary, the payment of which is deferred upon termination of the employment relationship.

It cannot therefore be regarded as a real severance payment as it consists of a certain monthly salary amount.

The TFR is calculated using the formula of dividing a total annual salary by 13.5, plus 1.5% for each year of service and an adjustment for inflation.

The TFR must be paid to the employee upon termination of the employment relationship.

In order to protect you from unforeseen financial risks arising from the termination of the employment relationship, IceHrm applies a severance pay provision in all employment contracts in this country. IceHrm has extensive expertise in managing litigation risk globally and the calculation of the severance provision is based on applicable common law or statutory requirements and best local practices. If your employee resigns or is not entitled to severance pay, you will receive a refund of any unused amounts.

Statutory Time Off

Paid Time Off

Full-time employees are entitled to 20 days of paid time off (PTO) per year. PTO is credited monthly at 1.67 days per month. Employees are allowed to take at least 10 working days in a row.

PTO for part-time employees is calculated based on the number of hours worked per week.

Public Holidays

taly celebrates both 12 national and 10 regional holidays depending on where the employee lives.

National holidays include:

New Year’s Day
Epiphany
Easter Sunday
Easter Monday
Liberation Day
Labor Day
Republic Day
Assumption of Mary
All Saints’ Day
Feast of the Immaculate Conception
Christmas Day
St. Stephen’s Day

Onboarding

3 working days after signing the MSA and paying the deposit.

Additional Info

Employment Contract Details

The contracts must be drawn up in Italian and can be bilingual. To prepare the employment contract, the employee must provide information about his previous employment in order to choose the classification as dirigenti, quadri or impiegato. The contract must be in writing and signed by both parties.

A contract must contain:

Name
Start date
Length of the employment
Job description
Category of the employee
Termination conditions

Probation Period

Probationary periods are not mandatory. There is no minimum probation period. The maximum duration of the probationary period is 180 days (6 months).