The Main Innovations in Procurement Introduced by Law No. 56/2024
As of May 1st, 2024, Law No. 56/2024, the conversion of Legislative Decree No. 19/2024, has entered into force.
Below are the main novelties regarding the procurement of works and services:
“Equal Treatment” Clause for Employees in Procurement
Firstly, Article 29, paragraph 2, of Legislative Decree No. 19/2024, as amended by the conversion law, provides that “personnel employed in the procurement of works or services and in subcontracting are entitled to an overall economic and normative treatment not lower than that provided for by the most representative national and territorial collective agreement negotiated by the trade union associations of workers and employers, applied in the sector and for the area closely connected with the activity subject to procurement and subcontracting.”
This provision introduces a sort of “equal treatment” clause regarding the economic conditions that contractors and subcontractors are required to recognize for personnel employed in the procurement of works or services and in subcontracting.
Extension of Joint Liability
The same conversion law also confirmed that the joint liability provided for the client – who is jointly liable with the contractor for remuneration, including end-of-service payments, as well as social security contributions and insurance premiums due to workers in relation to the period of contract execution and within the limit of 2 years from its termination – also applies to cases of illegal subcontracting, procurement, and detachment.
This provision effectively supplements paragraph 2 of Article 29 of Legislative Decree No. 276/2003, by extending the scope of joint liability previously limited exclusively to “genuine” procurement.
Criminal Relevance and Sanctions in Cases of Illegal Procurement
The conversion law also confirmed the reshaping of the discipline of sanctions applicable in cases of illegal procurement provided by Legislative Decree No. 19/2024.
In particular, the provision essentially reinstates the criminal relevance of the offense of illegal procurement – as well as illegal subcontracting and detachment, all of which were previously decriminalized by Legislative Decree No. 8/2016.
This is aimed at combating the phenomenon of resorting to illegal procurement contracts, within which the contractor merely provides the workers’ services to the client, without effectively exercising organizational and managerial power over them, which instead is directly exercised by the client.
In detail, in cases of illegal procurement, the provision states that the user and the supplier:
- are punishable by imprisonment for up to one month or a fine of €60 for each worker employed and for each day of employment (note: if minors are exploited, the penalty is imprisonment for up to eighteen months and the fine is increased up to sixfold);
- are punishable by imprisonment for up to three months or a fine of €100 for each worker employed and for each day of employment, when labor supply is carried out with the specific purpose of circumventing legal provisions or collective agreements.
The above-mentioned sanctions are increased by 20% if, in the three years prior, the employer has been subject to criminal penalties for the same offenses.
In any case, the amount of the proportional pecuniary penalties cannot, even without the determination of minimum or maximum limits, be less than €5,000 or exceed €50,000.
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The LDP Team is available to provide legal assistance and consultancy to its clients regarding the correct interpretation and implementation of clauses provided in procurement contracts, as well as the management of the employment relationship of personnel employed within such contracts.
In light of recent legislative changes, and considering, among other things, the provision of the “fair treatment” clause for workers assigned to procurements, the LDP Team, with specific reference to procurement contracts, is therefore able to support its clients in:
• drafting customized employment letters for workers assigned to procurements;
• identifying the correct applicable National Collective Labor Agreement (CCNL) considering, among other things, the subject matter of the procurement itself;
• determining the correct contractual classification level based on the tasks assigned to workers assigned to procurements;
• analyzing and correctly implementing any social clauses provided in the applicable CCNL concerning cases of procurement change.
