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HR Breakfast “On 7 August 2018, the Dignity Decree has been converted into law with amendments: what changes for businesses” – 13 September 2018

Alberto De Luca and Valentino Biasi will be speakers to the next HR Breakfast organized by De Luca & Partners on 13 September.

The Dignity Degree has been converted into law: all the news affecting businesses The Senate, in yesterday’s session, has approved, converting it into law, Law Decree No. 87 regarding “Urgent Provisions for the dignity of employees and companies” (the so-called “Dignity Decree”) as it was approved by the Chamber of Deputies.

Soon it will be published on the Official Gazette.

Below we report the major changes that the decree will bring in labour-law.

Fixed-term contracts

  • The overall term of the employment contract has been reduced from 36 to 24 months, with the possibility of extensions dropping from 5 to 4;
  • the contract may be “without specified reason” only for the first 12 months, under penalty of its transformation inan open-term contract after said deadline;
  • if renewed, independently of the term of the previous contract, it is necessary to specify the reasons. This is also required in the case of an extension if, by effect of said extension, the contract exceeds 12 months, in this case also under penalty of its transformation in an open-term contract. Seasonal employment contracts, instead, may be renewed or extended without specified reasons;
  • the term within which the employee may challenge the fixed-term contract increases from 120 days to 180 days from its expiry;
  • the additional contribution to be borne by the employer is increased by 0.5% at the time of renewal of a fixed-term contract, even if it is a staff-leasing contract, with the exception of domestic worker contracts.

The new rules apply to fixed-term contracts entered into after 14 July 2018 as well as to the extensions and renewals occurring after 31 October 2018.

Staff leasing fixed-term contracts

Regulations set forth for the fixed-term contracts apply also to staff leasing fixed-term contracts, except article 21, paragraph 2 (governing the so-called “stop & go”), 23 (“Total number of fixed-term contracts”) and 24 (“Rights to take precedence”), of Legislative Decree No. 81/2015. In addition, it is also established that the number of employees hired under a staff leasing fixed-term contract shall not exceed in total 30% of the number of employees under an open-term contract working for the employer as of 1 January of the year in which said contracts have been signed. This without prejudice to other provisions established in the collective bargaining agreements applied by the employer and without prejudice to the quota limit pursuant to  article 23 of Legislative Decree No. 81/2015. The so-called fraudulent staff-leasing repealed by Legislative Decree No. 81/2015 is reintroduced and sanctioned with a monetary fine to be paid by the staff leasing company and the employer in the amount of EUR 20 per each employee involved and per each day of leasing.

Increasing Protections Employment Contract

The criteria for the indemnification protection established in the case of unlawful dismissal pursuant to article art. 3, paragraph 1, of the Legislative Decree 23/2015 have changed from a minimum of 6 to a maximum of 36 monthly salaries. In addition, the conciliatory proposal established on art. 6 of the Legislative Decree 23/2015 has been increased from a minimum of 3 to a maximum of 27 monthly salaries.

Occasional Employment

Hotels and tourist structures operating in the tourism sector may make use of occasional employment contracts if they do not employ more than 8 open-term employees and the total number of hours foreseen in terms of time does not exceed 10 days.

Bonus for hiring youths under 35

A new exemption from social security contributions has been approved when hiring youths under 35 years of age in the period 2019-2020. It is partial exemption (at a rate of 50%) and it is granted for 36 months, up to a maximum limit of EUR 3,000 per year.