In the past few days, the so called Dignity Decree (Law Decree 87/2018), which came into force on 14 July, was not approved by the Finance and Labour Committees which, during the review session, approved several amendments. With specific reference to the fixed term contract, the new regulations would be applicable to contracts entered into after the effective date of the Decree, as well as renewals and prorogations after 31 October 2018 (the so-called transition clause). Moreover, the Parliamentary Committees have approved, during the review session, the amendment according to which, except a different use of the collective agreement applied by the user, the number of employees hired with fixed term contract or staff leasing fixed term contracts cannot exceed overall 30% of the number of employees with open-ended contract working for the employer. In addition, the Committees have resolved on the introduction of the so called fraudulent staff leasing that takes place whenever the use of staff leased has the purpose of avoiding mandatory laws or collective agreements. Finally, the Committees, with reference to the conciliation model established on art. 6 of the Law Decree 23/2015, has proposed to higher the parameters from a minimum of 3 to a maximum of 27 monthly salaries. Now it is to be seen if the Decree will undergo further amendments at the time of approval.

The EU Directive No. 2018/957 amending the directive 96/71/EC regarding the posting of employees during the provision of services has been published on the EU Official Journal dated 9 July 2018. Specifically, the directive orders that the maximum term for transnational posting be 12 months, with the possibility of extending it for additional 6 months. At the end of the 12 months, based on the equal treatment principle, the posted employee shall be guaranteed with all the labour and employment conditions of the Country where he/she works. During the posting, the employees will be subjected to the regulations of the hosting country in terms of remuneration and they shall have the right to enjoy the lodging and indemnity conditions or reimbursement for travel expenses, meal and lodging, since he/she is away from home for business reasons. The member states shall apply also the regional or sector’s collective agreements, if widely encompassing and representative. The period in which the posted employee will hold his/her contributory regime  applicable in the origin country is reduced from 12 to 24 months and the regulations on the maximum work periods and minimum rest periods shall apply, including those governing the term of paid annual leaves. The regulation expands the application of the rules also to the staffing agencies that decide to post a worker at a user’s company headquarters or centre of activity in the territory of a member state. The Member States now have two years of time to adjust to said regulation their own domestic laws and regulations meaning by 30 July 2020.

On 20 July 2018, the parties reached an agreement for the renewal of the national collective bargaining agreement for employees of the chemical industry, chemical-pharmaceutical industry, chemical fibres and abrasive, lubricants and LPG industry (the so-called chemical industry contract). The main news from a financial standpoint concern the following: (i) recognition of an increase of EUR 97 gross (category D1) on the minimum economic remuneration during the term of the agreement, which was extended, temporarily, by six months, therefore up to June 2022. The increase is subdivided in 4 instalments: 1 January 2019 in the amount of EUR 30; 1 January 2020 in the amount of EUR 27; 1 July 2021 in the amount of EUR 24; 1 June 2022 in the amount of EUR 16; (ii) confirmation effective from the month of July 2018 of the Edr (distinct element of pay) in the amount EUR 22, to which additional EUR 9 will be added effective from January 2019 deriving from the verifications of the previous agreement. At the end of this new agreement, however, an overall review is planned to ensure alignment of the minimum collective remuneration to the actual inflation. From a regulatory standpoint, in addition to focusing on employment and productivity, the agreement pays specific attention to (i) the improvement in the quality of the industrial relations, (ii) the growing investment on  safety, health and environment (even through digital means) and (iii) a major boost to the dissemination of training (promoting youth employment). This is the first National Collective Bargaining Agreement to apply the interconfederal agreement on the bargaining signed on the past 9 March (the so-called Factory Agreement). Now it will be the turn of the employees to speak in the meetings to provide their feedback on the Agreement.

VITTORIO DE LUCA: “THE DECISION TO OPEN A DIALOGUE WITH THE EMPLOYERS (FOOD DELIVERY COMPANIES) IS MEANINGFUL AND THE DOCUMENT SIGNED BY SOME OF THEM REPRESENTS A FIRST STEP, BUT WHY NOTHING HAS BEEN INCLUDED IN THE DECREE?”

The new government has the merit of having opened a dialogue aimed at regulating the work of riders, the delivery-people working for the gig economy and that today are not protected in any manner. However, it is unusual that the “dignity” decree, contrary to the expectations, does not mention riders or other workers currently unprotected while introducing instead a series of major restrictions regarding fixed-term contracts, taking us back to the ’60s when the obligation to specify the reasons for hiring under a fixed-term contract had been introduced, with the penalty of automatically turning it into an open-ended contract.”

says Attorney Vittorio De Luca, Managing Partner of the De Luca & Partners Law Firm, who adds: “Gig economy workers, differently from those with a fixed-term contract, have no protection at all, since they represent a new type of business relationship, which to date does not fall under the criteria established by the literature and case-law of the ‘70s and ‘80s.”

According to De Luca, the path chosen by the government to regulate the sector is the right one: “The decision to open a dialogue with the employers, the food delivery companies, is meaningful and the charter of values signed by some of them represents the first step in the right direction.” Riders wish to be considered as “traditional” employees with a guaranteed amount of hours, a minimum salary, full insurance coverage against injuries and illness, social security contributions, prohibition of piecework remuneration (in all its forms), removal of ranking mechanisms and the establishment of union rights.

“The problem,” De Luca explains, “is that up until now, the riders’ position in Italy was dealt with  old criteria that are not adequate to meet the needs emerging from the new forms of economy. Essentially, this crisis stems from the inability to break the dichotomy between self-employment and employment and by the inadequacy of the laws of the individual countries. In fact, this is not a situation that affects Italy only, but also many of the western countries.” On the other hand, still according to De Luca, the new government measures on fixed-term contracts, “although emerging from the good intention of increasing employment, fail to hit the target. Historical experience showed that restrictions such as “reasons to be provided” represent a significant obstacle for companies, in addition to lead to inevitable legal disputes that with the Poletti’s decree dated 2014 were essentially reduced to zero. The new obligations will likely lead to conversions into open-ended contracts, but just as easily they will relegate workers to types of employments that are less regulated and protected compared to a fixed-term employment contract.”

“However, it is the economy,” De Luca states, “that generates work and not the protections and the rigid obligations introduced by the authority. Cost increases and uncertainties for companies will damage competitiveness and the international attractiveness of our economy.”

Source: Affari & Finanza

“These are very hectic days for the companies and agencies offering staff leasing due to the effects of the new fixed-term contracts rules. This risks to trigger a surge of contract extensions and renewals before the new rules enter into force, even if no one has seen the final text of the decree yet.” Vittorio De Luca is a labour attorney and Managing Partner of the Milan-based law firm “De Luca & Partners”, and in the past few days his firm has been inundated by telephone calls from entrepreneurs asking news on the magnitude of the new decree. “The majority of them worry about the introduction of the reasons, which until 4 years ago had led to a high volume of disputes – he explains. In the past few years the greater ease of use of the fixed-term contract has certainly helped in hiring people in companies even if within a context of market uncertainty. Among our clients there are multinational companies, which beyond the merit and actual magnitude of the rules, are worried also by the negative signal originating from the first action of the new government.”

Click here to continue reading the interview on Il Sole 24 Ore.