After numerous debates due to differences among the major political forces regarding whether to extend the current ban on collective and individual layoffs for objective justified reasons, the ban was upheld by Law Decree No. 73/2021 and ultimately by Law Decree No. 99/2021, but not for everyone.
OVERVIEW OF THE PROVISIONS
On May 25, 2021, the Italian government enacted what is known as the “Decreto Sostegni bis” (Law Decree No. 73/2021), which regulated the ban on layoffs as follows:
- Through June 30, 2021, for all employers subject to the use of the special supplementary salary scheme known as the “Cassa Integrazione Ordinaria”;
- Through October 31, 2021, for employers subject to the use of special supplementary salary schemes, such as the “Cassa Integrazione in Deroga,” “Assegno Ordinario,” (FIS) and Bilateral Solidarity Funds;
- For the duration of the use of the ordinary (“Cassa Integrazione Ordinaria”) and extraordinary (“Cassa Integrazione Straordinaria”) supplementary salary schemes, if used by July 1, 2021 (and, in any case, within by December 31, 2021).
THE NEW PROVISIONS INTRODUCED BY LAW DECREE NO. 99/2021
Lastly, Law Decree No. 99/2021, issued on June 30, 2021, introduced two changes to the previous framework outlined by Law Decree No. 73/2021.
The first change consists of an additional 17 weeks of free (i.e., without additional employer contributions) Covid-related furlough schemes that can be requested during the period from July 1 through October 31, 2021, for companies in the textile and clothing sectors (Ateco codes 13, 14, and 15), which are considered still to be in crisis. These companies are therefore covered by the ban on layoffs through October 31, 2021.
The second change consists of 13 additional weeks of free furlough schemes, through December 31, 2021, for companies that can no longer benefit from the ordinary/extraordinary (“Cassa Integrazione Ordinaria”/“Cassa Integrazione Straordinaria”) schemes, with a consequent ban on layoffs during the use of those additional weeks.
It remains possible to lay off employees in certain specific scenarios. The exceptions to the ban on layoffs provided in previous legislation remain unaffected and are as follows:
- permanent termination of business activity due to liquidation (unless all or part of a going concern is sold off);
- bankruptcy without temporary exercise of the business;
- execution of a collective company-level agreement signed by major national trade unions that provides incentives to terminate employment relationships.