Employee Benefits in Italy

Read our comprehensive guide to employee benefits in Italy to ensure your hiring strategies are effective and aligned with local labor laws.

Looking to expand into new territories and grow your profits? Bringing on Italian workers could be the answer. The country’s enormously skilled workforce, English proficiency, and creativity are just a few reasons why international companies target Italian talent.

But don’t act haphazardly; tapping into the Italian workforce isn’t to be taken lightly. A calculated, well-informed effort is essential to success for international employers. And the first step is to learn about employee benefits in Italy. And that’s what we’ll help with in this article.

Read on to learn the basics of employee benefits in Italy – we’ll cover where to find Italy labor laws, mandatory employee benefits in Italy, potential add-ons to include in your benefit plan, and more. By the end, you’ll have the information and resources you need to build a winning benefit plan that works for your specific purposes.

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Where to Find Italy Labor Laws

Before expanding operations to Italy, it’s critical for international employers to learn about Italy labor laws, particularly those revolving around employee benefits. This could be a problem for some because the official labor documents are all in the national language – Italian. But with a bit of creativity, you can get all the information you need to lawfully hire workers from the country.

You can find the official Italian labor code (Codice del Lavoro) in several places online, including on official Italian government websites:

To translate website text into English, go to your browser settings, click “Translate,” and change the language to English.

In addition to the actual Italian labor code, you can go to scholarly legal sources where lawyers paraphrase the law to make it easier for laypeople to understand. Some of the best ones include:

Mandatory Employee Benefits in Italy

What you’ll find as you explore Italian law is that there are many mandatory rules and regulations. We’ll go over them in this section:

Social Security Contributions

Just like in the bulk of other countries, in Italy, workers should be enrolled in Social Security. Under this umbrella, Italian workers can acquire the resources they need in the following areas and more:

Pensions

Monetary benefits for those who reach retirement age and are unable to work.

Sickness

When an employee is injured or too sick to come to work, they can receive financial help to get through the ordeal.

Maternity and Paternity

Before, during, and after the birth of a child, men and women can take leave and obtain regular payments throughout.

Disability and Survivors’ Benefits

Eligible employees can receive benefits for a disability, and if they pass away, their families can be awarded a portion of the employee’s retirement or disability benefits.

As an employer of Italian employees, you’ll be required to contribute around 20 to 30% of the employee’s salary to the above social security accounts. Employees typically only have to contribute about 10% of their earnings.

*You may have noticed that health insurance isn’t listed above. That’s because it’s provided by the government through taxes.

Working Hours and Overtime

If you hire Italian workers, keep in mind that regular work hours shouldn’t exceed 40 hours per week. If a worker works more than 40 hours in a week, that’s considered overtime. There’s no set pay rate for overtime, but this special pay arrangement should be addressed through a collective agreement.

Note: Italy doesn’t have a government-mandated minimum wage. Collective agreements help to ensure that workers aren’t underpaid.

Leave Allowances

There are several situations where employees are entitled by law to take time off of work. We’ll cover them below:

Holiday Leave

Italians are entitled to paid time off on annual holidays. On each holiday, the employee should receive their regular daily wage. Here’s a list of the annual holidays in Italy (for 2025) per the Consulate General:

January 1st – New Year
January 6th – Epiphany
April 25th – Liberation Day of Italy
May 1st – Labor Day
June 2nd – Day of the Republic
August 15th – Assumption Day
November 1st – All Saints’ Day
December 8th – Immaculate Conception
December 25th – 1st Christmas Holiday
December 26th – 2nd Christmas Holiday

Maternity and Paternity Leave

Expectant mothers are allowed 5 months of maternity leave – 2 months before the delivery and 3 months after the delivery. During this time, the Social Security Administration pays the employee about ⅔ of their salary. Most of the time, the employer is required to pay the remaining ⅓ of the employee’s salary. However, the actual terms will be dictated by collective agreements.

Sick Leave

When an employee falls ill, they are allowed sick leave. But there are specific provisions surrounding this benefit. The number of days an employee can take is determined by collective agreements. But, on average, the employee is allowed up to 180 days of paid leave due to sickness. Both the employer and social security administration foot the bill. After the initial sick leave period is over, further sick leave is typically unpaid.

Annual Leave

By law, every worker in Italy should be allowed to take 4 weeks of leave. They should receive full pay throughout their leave. Employers aren’t allowed to replace annual leave with payment – the employee must take time off.

Pension Plans

If an employee is insured through Italian social security and meets the benefit requirements, they can receive monetary payments over time. The amount will be determined by governmental authorities.

REMOTE PEOPLE FURTHER READING

To learn more about how things work, read this European Commission resource.

Bonus Payments

Italy mandates a 13th-month salary, where the employer pays the employee an extra month’s salary once a year.

Severance Pay

In Italy, severance pay – called Trattamento di Fine Rapporto – is non-negotiable. Employees who are let go from their jobs receive a lump sum on top of their last paycheck; it doesn’t matter why the employee was let go. To cover this lump sum, employers are required to contribute 6.91% of the employee’s salary to fund this benefit.

REMOTE PEOPLE FURTHER READING

You can learn more about severance pay by reviewing this resource.

Supplementary Employee Benefits in Italy

Italian employees are eligible for many different employee benefits, so it’s imperative to get the mandatory benefits in place. But never underestimate the appeal of supplementary benefits. They can grant you access to a caliber of talent you wouldn’t be able to reach if you only offered rock-bottom benefits.

On top of that, offering add-on benefits to your Italian employees is a great way to show them that they’re valued. Here are some supplementary employee benefits to consider:

Performance-based bonuses for top performers on your teams.
Extra time off for health and wellness or personal reasons.
Professional development and training for employees, along with a clear path toward promotions.
Opportunities to work from home all or a portion of the time.
Extra contributions to social security funds (where applicable).
Private health insurance to cover services and products that aren’t covered by public healthcare.

How to Build an Employee Benefit Plan for Italian Employees

Building an Italy employee benefits plan requires research, careful planning, and often professional help. Start by diving headfirst into the legalese surrounding employment law in Italy – the actual full-text laws. If you need help dissecting the official laws, reach out to a lawyer who specializes in international law. It’s even better if you can find one that’s bilingual in English and Italian.

Once you’ve got a solid understanding of the laws, plan out and build your employee benefit plan. Nail down the non-negotiable benefits, which we’ve outlined earlier in this article, and then top things off with any add-on benefits you want to include. Be sure to choose the ones that you believe will most resonate with your candidates.

Here are a few other professional resources to consider throughout the benefits package drafting process:

Professional Services	How They Can Help
Global Tax Professionals	Ensure your benefits package complies with international tax laws for employers and employees.
Professional Employer Organizations (PEOs)	Manage payroll, compliance, and benefits administration on your behalf.
Employers of Record (EORs)	Act as the legal employer for your workforce while you oversee daily operations.
Business Consultants with International Experience	Provide strategic advice to create a competitive, market-ready benefits plan that attracts top talent.

You may not need to consult these professionals depending on your specific skill set, but they’re available should you hit a roadblock.

So, there you have it – the basics of employee benefits in Italy. We hope that this article has given you the information you need to create a compliant benefits package you’re proud of.