Italy
Employee participation within the company’s organization/management
Impact date: 10 June 2025 Law No. 76/2025 has introduced a legal framework for various forms of employee participation within companies, with the aim of promoting their adoption.
The law identifies the following participation models:
- Managerial participation: employee representatives may be involved in corporate governance by sitting on the board of directors or the supervisory board
- Financial participation: the law promotes profit-sharing among employees by introducing financial incentives
- Organizational participation: the law encourages the establishment of joint committees made up by the employer and employees representatives (“commissioni paritetiche”), tasked with making proposals on products, services and organizational innovation
- Advisory participation: the law establishes a structured consultation process allowing the commissioni paritetiche to contribute to corporate decision-making. NCBAs may set out alternative procedures
The implementation of these participation models is voluntary, unless this will be required in the future by the applicable NCBA.
Employer implications/action needed Employers should monitor the renewals of the applied NCBAs, particularly those introducing mandatory participation mechanisms or financial incentives linked to employee profit-sharing.
Employer risk Where NCBAs introduce binding forms of employee’s participation, any possible breach may result in employees claims in terms of anti-unions behavior.
Unlawful dismissals in small companies (case law)
Impact date: 21 July 2025 The Italian Constitutional Court with judgment No. 118/2025, declared that the six -month cap which is provided as an indemnity in the case of unlawful/unfair dismissal of any employees hired after 7 March 2015 and who are employed by small companies (i.e. less than 15 employees) is not compliant or in line with Italian Constitution.
The Court stated that the previous cap was rigid and did not have any deterrent effect on employers. It also mentioned that it prevented judges from tailoring the compensation on a case-by-case basis.
The Court held that the size of the company can no longer serve as a reliable measure of a company’s economic capacity. For small companies, in order to determine the fair measure of indemnity due to a redundant employee, it will now be necessary to take into consideration further and additional factors such as the turnover.
Employer implications/action needed Client awareness.
Employer risk Although further clarification is awaited, in a case of unfair dismissal by a company with less than 15 employees of an employee hired after 7 March 2015, the Courts may now require a company to pay compensation ranging from three to 18 months’ salary, removing the previous six-month cap.
Employees affected by cancer, disabling or chronic diseases
Impact date: 9 August 2025 A new law provides that the duration of the probationary period in a fixed-term employment contract is calculated by considering one day of effective work for each 15 calendar days period, with a maximum of 30 days for a 12 month fixed-term term employment contract. The Ministry of Labour has clarified that for contracts exceeding 12 months, the probationary period is a maximum of 30 days, unless otherwise provided by a collective bargaining agreement.
Employer implications/action needed Employers should take note of the new entitlements and ensure that leave requests are managed in full compliance with the new legal provisions.
Employer risk Failure to grant the new forms of leave may result in employees claims and in the payment of administrative fines.
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