Working in Italy - Amendments of Contracts

In accordance with Italian regulations, the binding nature of the hierarchical relationship between employee and employer is the fundamental defining criterion of an employment contract. The parties indicated in an employment contract must possess certain requisites of a legal nature and also the technical and physical suitability to perform the work in question. With regard to juridical requisites, both must possess the juridical capacity (i.e. the suitability to form part of an employment relationship, which in the case of the workers is intended as the capacity to perform work at fifteen years of age, i.e. the minimum age indicated by Italian law) and the capacity to ‘act’ (meant as the capacity to conclude an employment contract and to exercise all rights and perform all duties deriving therefrom) which in Italian law is acquired at the age of eighteen, unless special laws apply. The lack of capacity to act and the lack of a technical capacity (the latter regarding in particular those cases where diplomas, licences or registration in professional registers or other certificates issued by public authorities are required) leads to a contract being nullified, while the lack of juridical capacity implies the possibility of cancellation of the contract. 

In both cases, the right of the worker to receive a salary for the work and services provided is safeguarded. 

The obligatory requisites of an employment contract are the following: 

• agreement of both parties, taking account of the fact that the contractual offer by the employer is governed by the conditions set out in the national collective labour contract and the implementation of the employment procedure laid down in Presidential Decree No 442/2000 and Legislative Decree No 297/2002; 
• the purpose, that is, the exchange of work for payment; 
• the object, that is, the content of the work or service rendered and the payment, which must be lawful, possible and specifiable or specified. 

Unlawfulness of the object of the work contract (when the service is contrary to the legal rules on public order or morality) shall be penalised by the total and definitive nullity of the contract such that the worker shall not have the right to payment for services rendered; 

• and, finally, the form, which is in general unregulated. In this regard however, the law expressly requires it to be drawn up in writing: failure to comply with such requirement will result in the entire contract being made null and void. For example, the written form is required in the case of contracts for part-time work, work performed in the sports sector, the supply of labour resources, trial periods of employment, identification of the expiry of a period of employment or a pact imposing restrictions on competition. Finally, the written form is required in all cases in which the clauses forming part of a contract are unfavourable for the worker with respect to general regulations.

Agreements on Trial Periods of Employment 

The law provides that in the provisions of an employment contract, the parties may include clauses relating to a trial period of employment, which must be clarified in writing and must occur at the same time or before the date when employment begins. Its function is to verify reciprocal interest and the usefulness of continuing a working relationship. Terms regarding trial periods may be included in any employment contract, and also, for example, contracts concluded with disabled workers hired within the framework of compulsory employment rulings regarding handicapped persons. Such terms may also be included in fixed-term or part-time contracts. 

According to current laws, the maximum duration established for trial periods is six months for all workers and three months for office workers without managerial duties. It is understood that the terms laid down by law or established in national contracts may not be extended but may be reduced if both parties are in agreement. A clause in an individual contract specifying a trial period lasting longer than the maximum length of time set out in the collective contract, without prejudice to the legal limit, may be considered legitimate only in the case where the especial complexity of the tasks assigned to the employee makes it vital to have a longer period than is normally considered valid in the collective contract. 

In general terms, both parties during and at the expiry of the trial period are free to break the contract without any obligation to provide reasons or to give notice and without any obligation to pay compensation, except for cases where termination during the trial period is caused by discrimination and/or a factor extraneous to the work relationship; where the worker has not been assigned his or her tasks clearly and the trial period therefore does not provide a suitable assessment of his or her capabilities or where the worker is absent through illness. 

If a worker can demonstrate the unlawfulness of termination on the part of the employer during a trial period, he or she has the right to complete the trial period with payment of salary for the period remaining. 

On expiry of the trial period, it is not necessary for employers to provide written notification of their intention to continue the working relationship; the mere fact that the working relationship continues for a brief time beyond expiry of the trial period is sufficient for the working relationship to be considered as having been confirmed on account of successful completion of the trial period.

Obligation to Provide Information 

In implementation of Directive (EC) 91/533, Italian legislators issued Legislative Decree No 152 of 26 May 1997, which determines the obligation on the part of employers to inform employees in writing of conditions applying to their employment contract. This obligation applies in all possible working relationships, both public and private, created between a worker and employer. However, this obligation does not apply to work relationships lasting not more than one month in total and where the working hours do not exceed eight hours per week; work relationships with spouses or parents, work relationships at diplomatic representations and associated offices abroad. Within thirty days following the date an employee is hired, employers must comply with the ‘obligation to provide information’ by providing the employee with a written employment contract or a letter confirming that the worker has been hired or by means of any other document delivered to the worker. The employment contract may be of the fixed-term or open-ended kind.

Fixed Term Employment Contracts

The rules governing fixed-term employment contracts are contained in Legislative Decree No 368 of 6 September 2001, by which the Italian legal system transposed the EU Directive of 1999. In general the establishment of a fixed term of duration of an employment contract for technical, productivity, organisational or similar reasons is permitted, and must be done, directly or indirectly, in writing, (i.e., the end date may, where not expressly indicated, be indirectly inferred from the particular wording of the contract) or the contract will be ineffective apart from fixed-term casual work relationships lasting no longer than twelve days.

Contracts must also indicate detailed reasons for establishing a fixed term. A copy of the document must be delivered to the worker within five days following the date of the beginning of the working relationship. 

It is forbidden to enter into fixed-term contracts in the following cases: 

• to replace workers exercising their right to strike; 
• to replace absent workers, unless the provisions of union agreements stipulate otherwise, in productive units in which in the previous six months there have been collective dismissals of workers with the same duties as are referred to in the fixed-term contracts, except for cases where the contracts lasted no more than three months; 
• in cases where workers assigned to duties referred to by the fixed-term contracts have had their working hours suspended or reduced with the right to receive the earnings complement; 
• in companies which have not carried out an assessment of risks to workers’ health and safety. 

It is also possible in fixed-term contracts to provide for a period of trial employment provided it is established before or on commencement of duties and this is confirmed in writing.

Extensions

Fixed-term contracts may be extended only once by consent of the worker, and only in cases where an initial contract was concluded for a period of less than three years, in such cases, the duration of the contract, including an extension, may not exceed three years.

Expiry 

The law provides that the work relationship (both the initial one and any extended one) may continue after the expiry of the fixed term, for a maximum period of 20 days, if the term of the contract is less than six months and 30 days, if the term of the contract is greater than six months. In such cases, the employer must increase the worker’s wages for each day of the work relationship by 20 percent for the first 10 days and 40 percent for each day thereafter. Finally, if a working relationship continues beyond such periods, a contract is considered as being of a permanent nature, starting from expiry of the aforesaid terms.

Succession of Contracts 

A new fixed-term contract may be concluded with the same worker if at least 10 days have passed since the expiry of the first contract (when the latter had a duration of under six months), at least 20 days have passed since the expiry of the first contract (when the latter has a duration of over six months). If an employer fails to respect these terms, the second contract shall be considered as being indefinite (a tempo indeterminato i.e. of a permanent nature). Working periods are moreover considered as being indefinite from the date of signing of the first contract, in the case of two successive periods of employment on a fixed-term basis. Fixed-term employees have a right to contractual terms and all other conditions currently conceded within an organisation/firm to permanently employed persons, working in the same organisation/firm and categorised at the same level of employment. Such conditions of employment will be recognised in proportion to the period of work which is completed. Workers hired with a fixed-term contract have the right to receive training sufficient and adequate for the type of duties to be performed so as to prevent specific risks related to the work in question. The national collective labour contracts may identify the manner in which the professional skills of workers may be improved.

Exclusions

The rules governing fixed-term contracts do not apply to the following contractual situations, insofar as they are already governed by specific legislation: 

• staff-leasing contracts; 
• work-entry contracts; 
• apprenticeship contracts; 
• types of contract related to instances of on-the-job training which, although given a fixed-term, are not work relationships. 

The law requires collective negotiation, to identify quantitative limits for use of fixed-term contracts; however, all fixed-term contracts lasting not longer than seven months are expressly excluded from such limits. 

Included in the above stipulation are: 

• contracts concluded to provide replacements or for seasonal reasons in the initial phases of new operations; 
• contracts concluded because of an intensification in work operations over certain periods of the year;
• contracts concluded at the end of a period of apprenticeship, with the aim of facilitating the entry of the young person into the working environment; 
• contracts concluded with workers over 55 years of age; contracts linked to work or services that are specific or have a pre-determined time period of an occasional or exceptional nature. 

These exemptions do not apply – and therefore with application of quantitative limits – for fixed-term employment relating to work with duties identical to those identified in a previous fixed-term contract which expired less than six months previously. Identification of a priority right in employment exclusively for those workers hired with a fixed-term contract to allow organisations/firms to cope with an intensification of production is entrusted to national collective employment contracts. In any case, the priority right expires one year following the date a working relationship expires, and workers may exercise the right on the condition that they make manifest their intention to do so within three months after the working relationship has ceased.

Useful sources of information

• National Council of the Economy and Employment (Consiglio Nazionale dell’Economia e del Lavoro (CNEL)).
• Directive (EC) 93/104 of the Council of 23 November 1993, publ. in the Official Journal of the European Community No L 307 on 13.12.1993
• Law No 25 of 5 February 1999 (Community Law 1998)

Source: European Union
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