Employee Benefits in Italy: A Guide for Employers

If you want to attract and retain world-class talent in Italy, a competitive benefits package can make all the difference. However, this is easier said than done if you have to navigate complex local regulations you’re unfamiliar with, especially in a country like Italy with comprehensive statutory benefits.

As an Employer of Record (EOR), Playroll can simplify the process of attracting talent in Italy, removing the need for you to understand the intricacies of local labor laws. Our team has in-depth knowledge of 180+ countries and can onboard, pay and offer cutting-edge benefits for your talent, no matter where they are.

In this guide, we’ll unpack everything you need to know about statutory and fringe benefits in Italy.

Who is Entitled to Benefits in Italy?

Employee paid benefits in Italy are to some degree extended to all types of workers, including full-time, part-time, and fixed-term employees. However, the entitlement to benefits depends on the worker's category and the terms of their employment contract.

Generally, full-time employees receive the most comprehensive benefits packages, including health insurance, paid leave, and retirement contributions. Temporary and seasonal workers might receive fewer benefits, but they are still entitled to basic statutory benefits such as health insurance and paid leave.

What Does an Employee Benefits Package Consist Of?

An employee benefits package in Italy generally includes both statutory and fringe benefits. Statutory benefits are mandated by law, while fringe benefits are additional perks provided by employers to improve employee satisfaction and loyalty.

Statutory Benefits in Italy

Statutory benefits are legally required and form the core of any employee benefits package in Italy. These benefits ensure a minimum standard of protection and support for employees.

Maternity Leave

In Italy, mothers are entitled to five months of paid maternity leave (congedo di maternità). It is usually taken two months before and three months after childbirth, at 80% of their salary covered by Social Security and 20% by the employer.

Paternity Leave

Fathers receive 10 days of compulsory paid paternity leave (congedo di paternità) at 100% of their salary, covered by Social Security. Paternity leave can be taken within five months of the child's birth. In case of serious conditions that prevent the mother from taking care of the child, the right to absence from work is granted to the father.

Parental Leave

Optional supplementary unpaid parental leave (congedo parentale facoltativo) is a reduced paid leave that may be claimed by either the mother or the father. It can last up to 9 months in total, until the child reaches the age of 12 (or within 12 years after the adoption). Social Security covers 30% of the salary during this period.

Annual Leave

Italian employees are entitled to a legal minimum of 22 to 26 days or approximately four weeks of paid annual leave. Additional leave days accrue with seniority, or years of service for the company. Plus, days off are given for public holidays, which amounts to 12 additional days off per year.

For part-time employees, the amount of paid leave days is determined based on the number of their daily working hours. On the other hand, managers, known as dirigenti, are entitled to 30 days of paid leave annually.

This leave is crucial for maintaining a healthy work-life balance and is often supplemented by additional days off as per collective agreements​.

Sick Leave

Sick leave in Italy is well-protected. Employees are entitled to paid sick leave, which is partially covered by the National Social Security Institute (INPS) and topped up by the employer.

The compensation structure varies, with 100% salary coverage for the first three days and 50% from the fourth to the twentieth day. From the twenty-first day onwards, sick pay equals 66% of average daily pay up to a maximum of 180 days per year.

Retirement Benefits

In Italy, employers are required to contribute a substantial portion of their employees' salaries to pension schemes. The contribution rates are among the highest in Europe. Specifically, employers contribute approximately 33% of an employee's salary towards pension funds, while employees contribute about 9%​. This combined contribution ensures that employees are supported in their retirement years, adhering to Italy's robust social security system.

Bonus Payments

In Italy, there are two annual bonus payments. The tredicesima, or the 13th-month pay is disbursed alongside the December salary. Additionally, certain National Collective Agreements (NCAs) stipulate a quattordicesima, or the 14th-month installment, typically given in June.

‍

Fringe Benefits and Perks in Italy

Fringe benefits are additional perks that employers offer to make their benefits packages more attractive. These benefits are not legally required but are highly valued by employees. They can vary widely and often include:

Supplemental Health Insurance

Italy's National Health Service provides comprehensive healthcare to all citizens and legal residents, so employers are not required to provide health insurance.

However, employers can offer supplemental health insurance plans. This allows employees to access private medical services and specialists not covered by the public system​.

These plans typically cover a wide range of medical expenses, including hospitalization, specialist visits, dental care, and oncology therapies. Employers often pay the insurance premiums, providing employees with extensive health coverage at no cost.

Travel Allowance

Employers in Italy may provide travel allowances to cover commuting costs. This can include company cars, fuel allowances, or public transportation passes, helping employees manage their travel expenses more efficiently​.

This benefit is particularly valuable in urban areas where public transportation costs can be substantial. A travel allowance ensures that employees can commute to work without financial strain.

Remote Work Opportunities

Flexible work arrangements, such as remote work, became considerably more popular in Italy following COVID-19. However, it is still one of the countries with the lowest percentage of job listings that mention remote work, around just 8%. Leveraging these arrangements can help employees achieve better work-life balance and can be a significant drawing card for top talent.

Company Cars

Providing company cars is a common fringe benefit in Italy, especially for roles that require extensive travel. This benefit often includes car insurance and maintenance costs covered by the employer, which helps employees save on personal transportation expenses​. 

Meal Vouchers

Meal vouchers are a popular benefit in Italy and are exempted from tax up to €5.29 per day. Employers provide these vouchers to employees to use at restaurants or supermarkets. This benefit helps offset the cost of meals during work hours and is a valued addition to the compensation package​.

Professional Development

Many Italian employers invest in their employees' professional development by offering access to training programs, courses, and conferences. This benefit helps employees enhance their skills and advance their careers, making it a significant attraction for ambitious professionals​.

Gym Memberships and Wellness Programs

Employers may offer gym memberships or wellness programs to promote the health and well-being of their employees. This benefit supports employees in maintaining a healthy lifestyle, which can lead to increased productivity and reduce absence.

‍

‍

Manage Benefits For Your Italian Employees With Playroll

Providing a competitive benefits package for international employees can be a significant challenge, requiring expertise in local labor laws and contracts.

An Employer of Record like Playroll removes this complexity. Leverage our experts to offer attractive local benefits to your employees without the need to first establish a costly legal entity in Italy. Our team knows the rulebook when it comes to the local labor laws and benefits of 180+ regions.

Contact us to learn more about managing employee benefits, payroll and setting up compliant contracts for your global workforce, all in one place.