Employing in Italy
Employee Classification
In Italy, each industry has a National Collective Labour Agreement (CCLA) that governs the employee working relationship. Employees working through PEO Worldwide will be subject to the Tertiary sector.
Furthermore, employees will also be classed in accordance with one of the below categories. There are seven levels of classification that will determine the terms of employment and statutory benefits that each category of employee is entitled to.

Dirigente
Dirigenti are the highest category of employee, defined in Italy by specific collective agreements. This includes employees who are responsible for running the company or managing an independent part. Dirigenti also include certain employees with very high-level technical, scientific and/or professional qualifications.
Quadro
A Quadro carries out managerial tasks and reports to a dirigente. He / she has a significant degree of autonomy and is directly responsible for the tasks, projects and staff (if assigned line manager responsibilities).
Funzionari normally are on the upper side of this professional category. All managers in general belong to this professional category: finance managers, operations managers, marketing managers, shop managers, events managers, site managers, etc.
Impiegato
An impiegato/a reports to a quadro (or to a dirigente when employed by SME) and carries out office-related tasks and projects.
Salary Information
Holidays & leave
Country specific information
Statutory Insurances
The National Institute for Insurance against Accidents at Work (INAIL)
INAIL manages the insurance system, funded through contributions paid by employers, which protects workers in case of accidents; death in the workplace; occupational disease.
Healthcare
The National Health Service (SSN) is funded by all residents of Italy through taxes, as well as through co-payment of the cost of medicines and health services through payment of what is referred to as the ‘ticket’ and managed by the individual regions through the Local Health Authorities.
Employers Costs
Social Security
Social Security contributions will vary between 26% – 32% dependent on the work activity and seniority level of the employee.
Leaving Indemnity (TFR)
Part of the employee’s salary should be set aside as a deferred payment which the employee shall receive upon termination. This is irrespective of the cause of termination. Employees can additionally choose for the accrued funds to be allocated to a complementary pension fund.
TopSource Worldwide will provide a detailed breakdown of employer’s costs once the employee classification has been established.
Contractual Provisions
Notice period
In case of termination of an employment contract with permanent duration, the employer has to provide the employee with the appropriate termination notice.
The duration of the notice period is established in the collective bargaining contracts and normally varies depending on the seniority and on the qualifications of the employee. During the notice period, the employment relationship continues and both parties should fulfil their mutual obligations: the employer continues with the regular payment of the salary and the employee shall perform his normal working activity.
Should the employer not respect the notice period, the employer shall pay a lack-of-notice indemnification equal to the amount of money he should have paid if the notice period were respected (“indennità di mancato preavviso “).
Any termination needs to be discussed prior with PEO Worldwide.
Severance Pay
Employees are entitled to a mandatory “end of service allowance” in Italy (TFR – trattamento di fine rapporto). It is payable if the employees contract is terminated, also on resignation and dismissal for just cause or death.
This is invoiced and accrued monthly by TopSource Worldwide. Please note: TFR is roughly equal to 7,41% of the yearly salary.
Contract of Employment
Contracts will be subject to a CLA (Collective Labour Agreement) dependent on the industry and classification of the employee.
Probationary Period
Probationary periods will vary depending on the employment classification. Typically, this will be up to 6 months for a managerial position and 60 working days for a non-managerial position.
Working Hours
Collective agreements determine the maximum working hours per week, but should never exceed 40 hours per week. The numbers of working hours should be documented on the payslip.
Rest Breaks
Working hours are typically quite structured in Italy, often allowing a meal break of up to two hours.
Overtime
An employee must not work more than 48 hours per week, inclusive of overtime.
Public Holidays
In addition to annual leave, there are 11 statutory public holidays in Italy. If a public holiday falls on a Sunday, the day is carried over to Monday or paid.
- Saturday 1 January – New Year’s Day (Capodanno)
- Thursday 6 January – Epiphany (Epifania)
- Monday 18 April – Easter Monday (Lunedì di Pasqua)
- Sunday 25 April – Liberation Day (Liberazione dal nazifascismo)
- Sunday 1 May – Labour Day (Festa del lavoro)
- Thursday 2 June – Republic Day (Festa della Repubblica)
- Monday 15 August – Assumption Day (Assunzione di Maria)
- Tuesday 1 November – All Saint’s Day (Ognissanti)
- Thursday 8 December – Immaculate Conception (Immacolata Concezione)
- Sunday 25 December – Christmas Day (Natale)
- Monday 26 December – St. Stephen’s Day (Santo Stefano)
Keen to engage an EOR in Italy? At TopSource Worldwide, we work with local experts to help you navigate the various admin and cost obstacles you may come across along your expansion journey
To find out how we can help your business with our employment solutions, contact us today.
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