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SALARY PAYMENT IN Euro (EUR, €)
CONTRACT LANGUAGES Italian / English
PAYROLL TAX 20.40% – 32.40%
PAYROLL CYCLE Monthly
TIME TO HIRE 24 hours
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Italy offers a well-educated workforce with a high literacy rate and a strong focus on technical and vocational education. The country also boasts a low unemployment rate and a stable economy, making it attractive for businesses looking to hire or expand their workforce. Overall, Italy offers a range of skilled and dedicated employees who can bring innovative solutions and a unique flair to any team.
Population 59.07M (23.01M labor force) | Capital City Rome | Languages Spoken Italian. English and regional dialects also common |
Currency Euro (€) | GDP per capita $35,551.30 | Ease of Doing Business 58th in the world |
Minimum Wage None, unless set in a collective agreement. | Average Wage 2,475 EUR/month | Paid Leave 22 days |
Despite a strong GDP rebound in 2021, Italy’s economy is expected to face challenges in the coming years due to the ongoing war in Ukraine. This continued uncertainty and deflationary pressures are expected to curb household consumption, causing slower growth in the service sector. However, incentives such as Tax Credits for private businesses and the National Recovery and Resilience Plan may help mitigate some of these negative impacts.
One potential risk factor is the country’s heavy reliance on gas for energy, as higher prices or supply disruptions could further hinder economic growth. Rising bond yields could also have a negative impact on the overall business outlook in Italy. Overall, it will be important for the government to carefully manage these potential challenges in order to sustain positive economic growth in the long term.
Employment and labor laws in Italy are quite complex. It is governed in two major ways: through legislation established in national law and through Collective Bargaining Agreements (CBAs) made between trade unions and employer’s associations. In addition, there are several EU employment laws that apply in Italy.
The Constitution and the Civil Code
The Constitution and the Civil Code are the two key pieces of legislation governing employment in Italy. The Constitution sets out the minimum standards and rules that must be adhered to in several areas, including employment. Meanwhile, the Civil Code covers employment in Section III and includes provisions on contracts, rates of pay, and other important topics.
European Union Directive No. 533/91
As an EU member state, Italy is also subject to several EU laws on employment, including European Union Directive No. 533/91. This directive covers contracts and sets out certain rights and obligations for employers and employees.
Collective Bargaining Agreements (CBA)
In addition to national legislation, employers also need to be aware of Collective Bargaining Agreements (CBA). These agreements are made between trade unions and employer’s associations and set additional employment terms and conditions on top of anything already set out in standard law. For example, CBAs can cover rates of pay and increases, as well as employment terms such as vacation and sickness.
It’s important for businesses to be aware of these different laws and agreements when recruiting employees in Italy. By understanding the legal landscape, businesses can ensure that they comply with all applicable laws and regulations. Partnering with an EOR in Italy who has expertise in this area can help you navigate the complexity with ease.
As a country with a long history of commerce and trade, it’s not surprising that Italy has a strong business culture.
In terms of hierarchy within the workplace, there tends to be a more relaxed atmosphere where employees feel comfortable offering their input, and creativity is valued. However, Italians also place a high emphasis on punctuality and respect for authority figures.
In addition, personal relationships and connections are important for doing business in Italy. Networking and cultivating relationships with colleagues is essential for success. Building strong connections and establishing trust is crucial in the Italian business world, and it is not uncommon for deals to take longer to finalize while trust is built. Meeting face-to-face frequently and maintaining open lines of communication are also important elements of doing business in Italy.
When it comes to recruiting employees in Italy, employers have a few options available to them. The most common route is to advertise the position through job search websites such as Indeed, as well as networking within the industry. Employers can also work with recruitment agencies who specialize in finding and vetting potential candidates. Another option is to use headhunting firms, who actively seek out qualified individuals for specific positions.
Regardless of the method chosen, employers should make sure to comply with all regulations and paperwork before officially hiring a candidate.
Interviews in Italy are typically conducted in person, and these can range from formal interviews to more informal and relaxed conversations. However, as with anywhere in the world, technology has changed the way interviews are conducted, and it is not uncommon for candidates to be interviewed via a video conferencing service like Zoom.
The interview process can involve several interviews, and most commonly, there are 2-3 stages of interviews (HR, line manager, and senior management). before offering to a candidate. However, it is down to individual employers to decide how complex they want the interview process to be, and it is not unusual to hire candidates after one interview.
Although there is currently no legislation preventing you from asking about a candidate’s previous salary, it is generally considered poor practice. The legal situation may change in the future as there is a proposed EU directive being considered that will make it illegal to ask a candidate’s salary.
The typical salary increase for a new job in Italy varies between industries. As a general guide, 8-10% is standard.
Successful onboarding in Italy should include introducing the new employee to their line manager and colleagues, and ensuring they have access to any training and support they will need to settle into their role.
All onboarding in Italy will also include providing the employee with their employment contract and benefits details, and collecting any required paperwork and banking details for salary payments from the employee to finalize the process. When onboarding employees in Italy, employers should ensure that they are complying with the complex labor laws in Italy. Using an Employer of Record (EOR) solution in Italy is one way of ensuring that your onboarding process is compliant.
As more and more companies in Italy shift to remote work, reliable tools are needed to help employees stay connected and maintain productivity.
Microsoft Teams offers a wide range of communication and collaboration options, including video conferencing, messaging, and shared document editing. Zoom has become a popular choice for virtual meetings and can support large group sessions. Monday is a powerful project management tool that allows teams to organize tasks and track progress in real-time.
When choosing remote working tools for your company in Italy, it is important to consider the needs of your team and find a balance between features and ease of use.
December 25th, Christmas Day, is a public holiday in Italy, and Italians typically gather with family for a feast and gift exchange.
Christmas Eve is also celebrated with family gatherings and special meals, but it is not a national public holiday. However, many Italian employers choose to grant this day off or close the business after lunch on Christmas Eve.
In addition to Christmas Day, employers are also obligated to give their employees the following public holidays during the holiday season: December 26th (Santo Stefano), January 1st (Capodanno), and January 6th (Epifania).
| Date | Holiday name |
|---|---|
| 1 Jan, 2023 | New Year’s Day |
| 6 Jan, 2023 | Epiphany |
| 9 Apr, 2023 | Easter Sunday |
| 10 Apr, 2023 | Easter Monday |
| 25 Apr, 2023 | Liberation Day |
| 1 May, 2023 | Labor Day / May Day |
| 2 Jun, 2023 | Republic Day |
| 15 Aug, 2023 | Assumption of Mary |
| 1 Nov, 2023 | All Saints’ Day |
| 8 Dec, 2023 | Feast of the Immaculate Conception |
| 25 Dec,2023 | Christmas Day |
| 26 Dec,2023 | St. Stephen’s Day |
The amount varies between industries and experience levels, but employees in Italy receive an average pay raise of around 6% every 12 months.
When making the decision between hiring freelancers or employees in Italy, it is important to consider both the legal requirements and implications as well as the overall benefits for your business. Hiring an employee means that you will have more control over their work schedule and tasks. In terms of benefits for your business, freelancers may offer individualized skills or expertise that could be valuable for specific projects. Having a dedicated team of employees often allows for better workflow and communication within the company.
Ultimately, the best decision will depend on the unique needs and resources of your business. It is important to weigh all factors carefully before deciding.
As with many countries, Italy has specific regulations and requirements when it comes to hiring foreigners. Before a non-EU citizen can be hired, they must have both a valid work permit and a residence permit. Both of these documents must be obtained before starting work, as the employer is responsible for ensuring that the employee is legally allowed to work in Italy. In addition, there is an annual quota for foreign workers.
EU Citizens do not need a work permit to work in Italy, but they must register with the local authorities within 8 days of arrival.
Italian law requires that companies operating in Italy register certain legal documents with the authorities. To set up a branch office in Italy, you will need to provide information on the parent company and various documents attesting to the incorporation of the branch, such as:
Hiring employees in Italy follows a similar process to other countries, with the added requirement of obtaining a work permit for non-EU citizens. The first step is to define the job position and outline its requirements, duties, and responsibilities. Next, the company must advertise the job either via job sites, or by using a recruitment agency. Applicants can then submit their resumes, and the company will conduct interviews to select the best candidate.
It isn’t a legal requirement in Italy to have a written employment contract. But for a contract to be valid, there are some clauses that must be presented in writing. The employer must give these written clauses to the employee within 30 days of starting the job.
Your business can easily hire employees in Italy without opening a local entity. We handle local employment law, complex tax regulations, and international payroll in 180+ countries worldwide. All you need to do is focus on your business.
Holiday Schedule in Italy [2023]
