Employee Leasing in Italy

Content:

• Advantages of Employee Leasing in Italy
• Employee Leasing Services Offered by FMC Group
• Advantages of the Italian Market
• Recruitment in Italy
  • Minimum Wage and Payroll
  • Social Contributions and Taxes
  • Working Hours and Overtime
  • Vacation Days
  • Parental Leave and Sick leave
  • Notice Period

• Expanding business into Italy through employee leasing gives clients the opportunity to enter the Italian market as quickly as possible and benefit from the unlimited access it gives to the markets of the European Union and the Mediterranean region.
• Employee leasing allows clients to focus their attention on their growth strategy, as FMC Group handles the entire administrative and legal procedures relating to their expansion and the management of their employees.
• Clients who expand into the Italian market through employee leasing enjoy very high flexibility that significantly lowers their investment cost and risk.

• Selection of the candidates that match the client’s needs;
• Negotiation and signing of employment contracts with successful candidates;
• Payment of taxes and social contributions according to Italian law;
• Provision of accounting services according to international standards;
• Payment of all other types of expenses;
• Monitoring of the paid vacations of employees;
• Negotiation and implementation of private health insurance for employees if requested;
• Giving clients regular updates about the management of their employees.

• Italy is located in the middle of the Mediterranean region, which gives businesses a strategic door to consumers in the European Union, North Africa, and the Middle East. It is also an important location that links Southern, Central, and Eastern Europe. Much of Italy’s extensive transportation network is among Europe’s priority logistic hubs. Due to its central position in the Mediterranean, 20% of the world’s maritime traffic, 30% of fuel traffic, and 25% of container traffic pass through Italy’s seaports.
• Italy has put important reforms in place in order to encourage investment. For instance, the Italian government offers many tax credits and incentives for foreign investors, including tax credits for employment, tax deductions for energy efficiency, and tax reductions on income derived from specified intangible assets.
• Italy invests a lot in research and development. The country is developing a network of innovation incubators and science and technology parks, many of which are connected to universities and local development agencies. Italy has encouraged thousands of startups to spread new knowledge and technologies into the market thanks to this network.
• Investment opportunities in Italy mainly revolve around innovation and high technologies. The Italian government offers a wide range of incentives in many sectors, notably biotechnology, chemistry, aerospace, and the automotive industries.
• Italy has a skilled and competitive workforce. The quality of Italian higher education is world-renowned. More than 20 different Italian universities rank in the top 500 academic institutions in the world, according to the Academic Ranking of World Universities, and over 300,000 students graduate every year. Moreover, Italian hourly labor costs are significantly lower than in some other Western European countries such as France and Germany.
• The Italian Trade Agency offers information about investment opportunities, support to establish a business, and continuous after-support for incentives and contracts.

Minimum Wage and Payroll

• Italy does not have a statutory minimum wage. Each sector usually sets minimum wages according to national collective agreements.
• The payroll cycle in Italy is generally monthly, with salaries being paid on the 27^th day of the month.
• The 13^th-month salary bonus is mandatory under Italian labor law. It is paid out each year alongside the salary for December. Some national collective agreements also include a 14^th-month salary, typically paid in June.

Social Contributions and Taxes

Employer Contributions
Social Security	29.0% – 32.0%
Injuries at Work Insurance	0.4%
Total	29.4% – 32.4%
Employee Contributions
Social Security	10.0%
Employee Income Tax
Up to EUR 15,000 per year	23.0%
Between EUR 15,000 and EUR 28,000	25.0%
Between EUR 28,000 and EUR 50,000	35.0%
More than EUR 50,000	43.0%

 

Working Hours and Overtime

• Italian labor law defines the working hours limit at eight hours per day and 40 hours per week.
• Overtime work has to be paid at a rate higher than the regular salary rate. Overtime payment rates are usually set by national collective agreements.

Vacation Days

• Employees in Italy are legally entitled to a minimum of 8 days of paid leave per year after their first year of service. However, national collective agreements usually provide for paid annual leaves of no less than four weeks per year.
• Italy commemorates 10 public holidays:
  • New Year’s Day: January 1^st
  • Epiphany: January 6^th
  • Easter Monday: Between March and April (moveable)
  • Liberation Day: April 25^th
  • Labor Day: May 1^st
  • Republic Day: June 2^nd
  • Assumption Day: August 15^th
  • All Saints’ Day: November 1^st
  • Immaculate Conception: December 8^th
  • Christmas Holiday: December 25^th – 26^th

Parental Leave and Sick Leave

• Pregnant employees can take up to five months of paid maternity leave. The leave is usually taken two months before the delivery date and extends until three months after. Employees are entitled to 80% of their regular salary during maternity leave. The salary is paid by the employer and then reimbursed by social security. New mothers can also take up to six months of unpaid leave after the end of their paid leave.
• New fathers are entitled to 10 days of paid leave within five months after the birth of their child. Employers have to pay their employees 100% of their salary during paternity leave.
• Employees in Italy can take up to four paid sick leave periods per year. For the first two sick leaves, the first three days are fully paid by the employer. During the third sick leave, the pay rate for the first three days is reduced to 66%. Then, in the fourth sick leave, it is reduced to 50% in the first three days. Afterward, any subsequent sick leave in one year is unpaid. For all four paid sick leaves, the employee receives 100% of their salary between the fourth and 21^st day, paid as 50% by the employer and 50% by social security. From day 22 onwards, social security covers 66% of the salary, while the employer only has to pay 34%.

Notice Period

• The legal minimum notice period in Italy is set at 30 days for regular employees and 45 days for managers.

Further Useful Information

• Italy’s National Institute for Social Security provides detailed useful information about recruitment in Italy.