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On 17 March 2020, Decree-Law No. 18 of 17 March 2020 was published in the Official Gazette (“Gazzetta Ufficiale”) introducing measures supporting the Italian healthcare system and supporting households, workers and businesses in connection to the COVID-19 emergency outbreak (the so-called “Cura Italia” Decree, hereinafter the “Decree”).
One of the areas in which the Decree makes the most incisive intervention is that of support to employment and workers for the protection of work and income.
Please note that detailed circulars are currently being issued aimed to clarify practical and enforcement issues raised by the new rules on social shock absorbers, leaves and other forms of income support included in the Decree.
Below is a summary of the contents of the main provisions of the Decree, supplemented with the measures of the Interministerial Decree of 28 March 2020 and of INPS Circular No. 47 of 28 March 2020, relating to the above mentioned aspects.
The Decree provides for the opportunity to apply for ordinary salary integration or ordinary allowance by reason of “COVID-19 Emergency”.
The Decree provides for significant incentives, in derogation from Legislative Decree No. 148 of 14 September 2015, whose features are briefly summarized below.
Scope of Application
This measure is accessible to employers that during the year 2020 envisage a suspension or reduction of the work activities due to events linked to the COVID-19 outbreak emergency and that fall within one of the following categories:
Beneficiaries will be all workers who were employed by the applicant employers on 23 February 2020 and who are not required to have worked for at least 90 days on the date of submission of the application [1].
INPS has specified that the presence of previous holidays is not an impediment to the possible acceptance of the application for Ordinary Redundancy Fund or ordinary allowance.
As confirmed by INPS Circular No. 47/2020, the salary integration replaces the daily sickness allowance in the event of illness, as well as any supplement provided for by contract.
Duration and time-limits. No assessment of causal requirements
The application can cover periods commencing on 23 February 2020, up to a maximum duration of 9 weeks, and, in any case, up to August 2020.
INPS has also specified that the salary integration provided for by Decree Law No. 9 of 2 March 2020, with reference to specific areas of the country, is in addition to the ordinary salary integration and ordinary allowance provided for by the Decree. To this end, it is a necessary requirement that there is no overlap in time between the two measures or that workers receiving the benefits are different.
Submission of the application. No assessment of causal requirements
The application shall be submitted within the end of the fourth month following the one in which the working activity suspension or reduction has commenced and is not subject to the assessment of causal requirements, normally carried out. Hence, the company does not need to attach the technical report to the application, but only the list of workers who will receive the benefit stating as reason "National emergency COVID-19".
On 30 March 2020, an Agreement was signed by the social partners and the Italian Banking Association with the aim of defining a procedure for the advance payment of ordinary salary integration benefits and exceptional benefits for the emergency by the participating Banks, for an amount equal to Euro 1,400.00, calculated on the basis of a 9-week suspension at zero hours and reduced proportionally in the event of shorter duration and part-time employment. The advance is due to workers entitled to all income support measures referred to in Articles 19 to 22 of the Decree and subsequent regulatory measures in force, in favour of employees of employers who have suspended them from work at zero hours and have applied for direct payment by INPS.
The parties have also expressed their commitment to prepare the necessary forms to extend the advance also to the hypothesis of a reduction not to zero hours.
Information, consultations and possible joint examination phase
Employers submitting the application are anyway subject to the obligation of information, consultation and joint examination, also by electronic means, within the three days following the preliminary notification [2].
Effects on the maximum duration of the ordinary and extraordinary salary integration
The periods of salary integration and ordinary allowance granted for events linked to the COVID-19 outbreak emergency are not counted for the purposes of the maximum aggregate duration of the ordinary and extraordinary salary integration and access to the solidarity funds, provided by the relevant provisions on social shock absorbers during the employment relationship. Therefore, such periods shall not be taken into account for the purposes of further applications.
Company Cap and Additional Contributions
Only for year 2020, the ordinary allowance granted by the Fund for Salary Integration is not subject to the company cap, consisting of an amount equal to 10 times the ordinary contributions due by the same employer.
Moreover, no further contribution shall be paid as a result of such instruments, in derogation from the ordinary provisions under Legislative Decree No. 14 of 15 September 2015.
Ordinary allowance: beneficiary and payment method
The ordinary allowance is granted for the period stated and in the year 2020, also to employees of employers registered with the Salary Integration Fund (FIS) that employ more than 5 workers on average.
Moreover, at the employer request, such instrument may be granted by way of indirect payment by the Italian National Institute for Social Security (INPS). The same method shall apply to payments made by alternative bilateral solidarity funds and bilateral solidarity funds of Trentino and Alto Adige.
Scope of application
The provision applies to employers falling within the scope of the Extraordinary Redundancy Fund who on 23 February 2020 were receiving extraordinary salary integration benefits and who therefore have the possibility to apply for ordinary salary integration for events related to the epidemiological emergency by COVID-19, for a period not exceeding nine weeks.
Conditions and effects of the grant of the ordinary salary integration
The grant of the ordinary salary integration determines the suspension of the extraordinary redundancy fund already ongoing. The instrument provided for the COVID-19 emergency may concern also the same employees already included in the scope of the extraordinary salary integration, with a reduction up to 100% of working time.
Effects on the maximum duration of the ordinary and extraordinary salary integration envisaged
Periods of ordinary salary integration indemnity granted for events attributable to the COVID-19 epidemiological emergency are not counted for the purposes of the limits of the maximum overall duration of ordinary and extraordinary salary integration indemnity provided for by the regulations on social shock absorbers during the employment relationship. Therefore, these periods will not be taken into account for the purposes of subsequent applications.
Additional contribution
Only for the ordinary salary integration granted for events linked to the COVID-19 outbreak emergency, no additional contributions will have to be paid as a consequence of the use of this instrument.
Scope of application
This provision shall apply to employers, registered with the Salary Integration Fund, who on 23 February 2020 were receiving a solidarity allowance and who have the possibility to file an application for the grant of the ordinary allowance for events linked to the COVID-19 outbreak emergency, for a period not exceeding nine weeks.
Conditions and effects of the grant of the ordinary allowance
The grant of the ordinary allowance:
Effects on the maximum overall duration of the ordinary and extraordinary salary integration envisaged
The periods of co-existence of the solidarity allowance with the ordinary allowance for events linked to the COVID-19 outbreak emergency shall not be computed for the purposes of the maximum overall duration of the ordinary and extraordinary salary integration and access to solidarity funds provided for by the legislation on social shock absorbers during the employment relationship (in particular, the limits provided for under Article 4, paragraphs 1 and 2 and under Article 29, paragraph 3 of Legislative Decree No. 148 of 14 September 2015). Therefore, such periods are neutralised for the purpose of subsequent applications.
The wording of the provision raises more than one interpretative doubt and a clarification in this respect is expected.
Additional contribution
Limited to the periods of ordinary allowance granted for events related to the epidemiological emergency from COVID-19, no additional contribution shall be paid as a consequence of the use of the instrument.
Scope of Application
The provision shall apply to employers of the private sector, regardless of the number of their employees, who are not subject to the application of the instruments provided for by the current legislation in force on the suspension or reduction of working time.
In particular, the benefit in question will be available also to companies that, being entitled only to the Extraordinary Redundancy Fund, cannot have access to an ordinary shock absorber by reason of “COVID-19 national”.
Domestic employers are excluded.
As for the Ordinary Redundancy Fund and ordinary allowance, the presence of previous holidays still to be taken by the workers concerned is not an impediment to the acceptance of the request.
The procedure
For the purposes of obtaining access to the “exceptional” redundancy fund, a prior agreement is required, which may be executed also by electronic means, between the Regions and Autonomous Provinces and the trade unions that are comparatively more representative at national level for employers.
The implementing arrangements, including those relating to information, consultation and possible joint examination procedures, will be determined by the individual Regions and it will be necessary to refer to their decisions.
No further agreement is required for companies employing up to five employees.
The allowances at issue are granted by decree of the Regions and Autonomous Provinces concerned to be notified to INPS by electronic means within 48 hours from its adoption.
As regards the so-called multi-located employers, i.e. employers with several production units located in five or more Regions or Autonomous Provinces, the benefit is granted by decree of the Ministry of Labour and Social Policy.
In view of the expected broad participation in the support measure, it should be underlined that its effectiveness is subject to verification of compliance with the expenditure limits.
Access to the “exceptional” redundancy fund can be granted exclusively by means of direct payment by INPS .
Duration of the “exceptional” redundancy fund
The “exceptional” redundancy fund is granted for the duration of the suspension of the employment relationship and, in any case, for a period not longer than nine weeks. Employees are entitled to imputed contributions and relevant ancillary charges.
INPS has also specified that the salary integration provided for pursuant to Decree-Law No. 9 of 2 March 2020, with reference to specific areas of the country is in addition to the “exceptional” redundancy fund provided for by the Decree. To this end, it is a necessary requirement that there is no overlap in time between the two measures or that workers receiving the benefits are different.
Paid leave for parents
Workers who are parents of children up to the age of 12 (including foster parents) are entitled, as a result of the suspension of childcare services and educational activities in schools of all levels and degrees, to a leave granted alternately to both parents, for a total of fifteen days.
The leave may be enforced, even with retroactive effect as from 5 March 2020.
In any case, the age limit does not apply to children with disabilities in a situation of proven seriousness, enrolled in schools of all levels and degrees or accommodated in day care centres.
Moreover, the leave:
Unpaid leave for parents
Parents employed in the private sector with minor children between the ages of 12 and 16 – provided that in the household there is no other parent receiving income support in the event of suspension or cessation of work or that no non-working parent is present – have the right to abstain from work for the period of suspension of childcare services and educational activities in schools of all levels and degrees, without payment of compensation or of imputed social security contributions, with a ban on dismissal and the privilege of job retention.
COVID-19 emergency leave for working parents enrolled exclusively in the INPS’s special fund for self-employed workers
Working parents enrolled exclusively in the INPS’s special fund for self-employed workers are entitled, for children not older than 12 years of age, to a specific leave for which an allowance is paid equal to 50 per cent of 1/365 of the income identified according to the calculation basis used to determine the maternity allowance for each eligible day.
COVID-19 emergency leave for self-employed parents enrolled in INPS (Italian National Institute for Social Security)
Parents who are self-employed and enrolled in INPS are entitled to a specific leave for children not older than 12 years of age, for which an allowance is paid for each eligible day at 50% of the conventional daily salary established annually by law, depending on the type of self-employment.
Operating procedures
The operating procedures for accessing the COVID-19 emergency leave or the bonus for the purchase of baby-sitting services are established by INPS.
For parents who are employed in the public sector, the payment of the allowance, as well as an indication of how to take the leave is made by the public administration with which the employment relationship exists.
Babysitter Bonus
Recipients of paid leave may, as an alternative, request a bonus for the purchase of baby-sitting services up to an overall maximum limit of Euro 600.00 [3], to be used for services provided during the period of suspension of childcare services and educational activities in schools of all levels and degrees.
This bonus is also granted to self-employed workers who are not enrolled in INPS, subject to notification by the respective social security funds of the number of beneficiaries.
For workers who benefit from the leave referred to in Article 33, paragraph 3, of Law No. 104 of 5 February 1992, the number of days of paid monthly leave covered by imputed social security contributions shall be increased by a further twelve days in March and April 2020.
Private sector workers
In relation to private-sector workers, the period spent in quarantine with active surveillance or under fiduciary home-stay with active surveillance:
- is equivalent to illness for the purposes of the economic treatment provided for in the relevant legislation;
- is not counted for the purposes of the protected period.
With reference to the above-mentioned periods, the attending doctor is required to draw up the certificate of illness with the details of the measure that gave rise to the quarantine with active surveillance or to fiduciary home-stay with active surveillance.
Illness certificates transmitted before the entry into force of the Decree shall be considered valid.
Other cases regulated by the Decree
In relation to public and private employees who have a disability with connotation of seriousness, as well as to workers in possession of certification issued by the competent medical and legal bodies, attesting a condition of risk deriving from immunodepression or from the results of oncological pathologies or from undergoing the relevant life-saving therapies, the period of absence from the service prescribed by the competent health authorities must be treated as hospitalization.
With reference to the above-mentioned periods, the attending doctor shall draw up the certificate of illness with the details of the measure that gave rise to the quarantine with active surveillance or to fiduciary home-stay with active surveillance.
Illness certificates transmitted before the entry into force of the Decree shall be considered valid.
The Decree provides for the granting of an allowance, scheduled for the month of March, for an amount of Euro 600.00 in favour of:
- freelancers holding an active VAT number as at 23 February 2020, who are not pensioners and not enrolled in other compulsory social security schemes;
- workers with coordinated and continuous collaboration relationships active as at 23 February 2020, enrolled in the INPS’s special fund for self-employed workers, not pensioners and not enrolled in other compulsory social security schemes;
- self-employed workers enrolled in the special fund of the AGO, not pensioners and not enrolled in other compulsory social security schemes;
- seasonal employees in the tourism sector and spas who involuntarily terminated their employment relationship in the period between 1 January 2019 and the date of entry into force of the Decree, non-pensioners and not employed on the date of entry into force of this provision;
- fixed-term agricultural workers, non-pensioners, who have carried out at least 50 actual days of agricultural work in 2019;
- workers who are members of the Pension Fund for Workers in the Entertainment Industry, with at least 30 daily contributions, paid in 2019 to the same Fund, resulting in an income not exceeding Euro 50,000, and who are not pensioners.
It is also provided that the allowances:
- do not constitute income from work;
- are not cumulative;
- are not granted to recipients of citizenship income.
In compliance with the provisions of Article 44 of the Decree, on 28 March 2020, the Minister of Labour and Social Policies, in agreement with the Minister of Economy and Finance, signed the Interministerial decree that extended the right to the granting of an allowance of Euro 600.00 for the month of March also to self-employed workers and professionals enrolled in private pension funds [4]. In particular, the amount will be granted to:
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The Decree has extended – in order to facilitate applications – the time-limits for the submission of NASpI and DIS-COLL unemployment applications from sixty-eight to one hundred and twenty days, for events of involuntary cessation of work occurred from 1 January 2020 until 31 December 2020.
In addition, for applications submitted after the ordinary deadline, the effective date of the measure from 68 days after the date of involuntary cessation of employment shall remain unaffected.
As of 23 February 2020, until 1 June 2020, the forfeiture and limitation periods relating to «social security, welfare and insurance benefits provided by INPS and INAIL» shall be suspended ipso jure.
Article 39 of the Decree introduces the following additional measures on smart work [6]:
- until 30 April 2020, workers with disabilities or who have a disabled person in the family unit have the right to work using smart-working methods, provided that said working methods are «compatible with the characteristics of the performance»;
- private workers with «serious and proven pathologies» are given priority in accepting requests to perform their work using smart working methods.
An INAIL contribution of Euro 50 million will be paid by Invitalia to private employers for the purchase of «personal protective equipment and other personal protective devices».
With a view to maintaining employment levels, the provision at issue imposes on employers the following relevant measures concerning “economic” dismissals, which shall be effective within 60 days of the entry into force of the Decree:
So, within 60 days of the entry into force of the Decree-Law it will be possible to proceed only with dismissals that do not fall within the scope of the prohibition and, therefore, to dismiss for subjective just cause, just cause, failure to pass the probation period and, in consideration of the regulatory postponement contained in the provision, for exceeding the protected period.
Employees with an income from employment for the previous year up to Euro 40,000, are entitled to the payment, in the month of April 2020, of a premium for the month of March 2020 – which does not contribute to the formation of the total income – equal to Euro 100 to be calculated in relation to the number of days worked “at their workplace” in that month. This amount is paid in advance by the employer and then offset in the payment of taxes and social security contributions according to the indicated procedure.
Hearings scheduled from 9 March to 15 April 2020 in all civil and criminal proceedings - subject to the specific exceptions indicated - will be postponed ex officio and procedural deadlines - for the same period of time - will be suspended.
The content of this article is for information purposes only and does not constitute professional advice. For further information, please contact Michele Bignami, Roberta Russo or Dario Clementi.
[1] INPS has specified that in order for this requirement to be met, in the event of a transfer of business pursuant to Article 2112 of the Italian Civil Code and in cases of employees passing to the company taking over the contract, the period during which the worker was employed by the previous employer shall also be taken into account.
[2] Without prejudice to the aforementioned obligation, it should be noted that as an exception to Article 14 of Legislative Decree No. 148 of 14 September 2015, it is not necessary to attach to the application the trade union information or the minutes of any subsequent joint examination.
[3] For employees in the public and accredited private health sector, belonging to the categories of doctors, nurses, biomedical laboratory technicians, medical radiology technicians and socio-medical operators, as well as employees of the State Police, the bonus for the purchase of baby-sitting services for the care and supervision of children up to the age of 12 years is instead provided within the overall maximum limit of Euro 1000.00.
[4] On this point, it should be noted that said interministerial decree has set at 200 million Euros for year 2020 the share of the Fund's spending limit referred to in Article 44, paragraph 1 of the Decree, which is intended to support the income of self-employed workers and professionals who are enrolled in private law bodies for compulsory social security. In addition, it should be noted that applications for the indemnity referred to in this Decree must be submitted by professionals and self-employed workers starting from 1 April 2020 to the social security institutions with which they are compulsorily registered and which shall verify their regularity for the purpose of granting the benefit.
[5] On this point, it should be noted that, for the purposes of the aforementioned interministerial decree: a) cessation of activity means: the closure of the VAT number, in the period included between 23 February 2020 and 31 March 2020; b) reduction or suspension of working activity means: a proven reduction by at least 33 per cent in the income of the first quarter of 2020, compared to the income of the first quarter of 2019. For this purpose, income is identified according to the cash principle as the difference between income and payments received and expenses incurred in the performance of the activity.
[6] On this point, it should be noted that, in order to give priority to the use of smart working, the Decree of the President of the Council of Ministers of 1 March 2020 provided for the possibility for employers throughout Italy, until 31 July 2020, to resort immediately to smart working, even in the absence of individual agreement with the worker, without prejudice to the obligation to provide information on risks to health and safety at work - even electronically and even using the documentation made available on the INAIL online site.
