Employer of Record (EOR) in Italy

Employment contracts

In Italy, it is obligatory by law to have a comprehensive employment contract, including the terms of the employee’s remuneration, benefits, and termination. A contract for employment in Italy should always list the wage and any other compensation in Euros, rather than a foreign currency.

Working hours

A typical work week for an employee is 40 hours.

Holidays

Italy observes 12 national holidays, which are generally treated as paid leave for employees:

  • New Year’s Day
  • Easter
  • Epiphany
  • Easter Monday
  • Labor Day
  • Liberation Day
  • Date of the Founding of the Republic
  • All Saints’ Day
  • Assumption Day
  • Feast of the Immaculate Conception
  • Stephen’s Day
  • Christmas Day

Days of Vacation in Italy PEO

The CBA stipulates that employees are entitled to 25 vacation days and 32 hours of paid leave.

Sick Leaves

According to Italy’s labor legislation, employees are entitled to three paid days off each year in the event of a serious sickness (with a doctor’s note) or the death of a spouse or relative within the second degree. In the event of a serious sickness, arrangements may be reached with the employer. Leave of up to two years, continuous or intermittent, may be granted for significant, verified family reasons.

Italy’s Maternity/Paternity Leave

Female employees are eligible for maternity leave for two months prior to the expected date of childbirth and three months afterward. During maternity leave, a daily allowance equivalent to 80% of the previous salary earned through the social security system is awarded (INPS).

Health insurance

National health insurance in Italy is administered by the National Health Service (SSN) and financed by both direct and indirect employer and employee taxes. A social security number and a health card are issued upon enrolling with the Local Health Service. The health card entitles low-cost or free medical care.

Italy Additional Benefits

Some businesses offer allowances for company automobiles, mobile phones, and food coupons. Frequently, high-tech companies offer training.

Bonuses

In Italy, it is typical to receive a 13th month or annual bonus (tredicesima mensilita) immediately before Christmas. Some of the larger corporations additionally provide their staff the 14th month of salary in the summer (quattordicesima mensilita).

Termination and severance

In Italy, an employee may only be terminated for a valid and serious reason. Italian courts define just cause for termination as any major infraction, such as stealing. Employers may terminate employees on justified grounds for less serious violations, such as unexcused or repeated absences from work, if they can objectively demonstrate the business necessity for termination or for so-called subjective reasons, such as a breach of contractual obligations or negligence.

Paying Taxes in Italy

Italy’s income tax is progressive, meaning that the higher the income, the higher the tax rate. Individual tax rates ranged between 23 and 43 percent.

Conclusion

It will take a significant amount of time, money, and effort to establish a branch office or a subsidiary in Italy in order to employ a small workforce. Strong protections for workers are provided by Italian labor law, which calls for careful attention to detail and an awareness of the most effective procedures in the local community. Acvian simplifies the process of expanding into Italy quickly, straightforwardly, and simply. Without the difficulty of establishing a foreign branch office or subsidiary, we are able to assist you in hiring the candidate of your choice, managing HR-related issues and payroll, and ensuring that your business is in conformity with local legislation. Our Italy PEO and Global Employer of Record approach will give you peace of mind, allowing you to concentrate on running your business while we handle employee matters.

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