The Italian Official Gazette No. 157 of July 6, 2024, published Law No. 95 of July 4, 2024, which converts, with amendments, Decree-Law No. 60/2024, containing “urgent provisions on cohesion policies” (the so-called Cohesion Decree).
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One of the main objectives of the Cohesion Decree is to promote youth and female employment, especially in Southern Italy. More than €2.8 billion has been allocated for employment promotion under the National Program for Youth, Women, and Work 2021-2027 and Measure 5 of the National Recovery and Resilience Plan (PNRR), focusing on active labor policies linked to the GOL Program (Worker Employability Guarantee). Additional resources are available for reskilling workers in large companies undergoing restructuring.
YOUTH EMPLOYMENT INCENTIVE
Article 22 of DL 60/2024 grants private employers a social security contribution exemption when hiring young workers.
Private employers who, between September 1, 2024, and December 31, 2025, hire non-executive personnel under 35 on a permanent contract or convert an existing fixed-term contract into a permanent one, for individuals who have never been employed on a permanent contract prior to the incentivized hire, are entitled to a full exemption from social security contributions (excluding INAIL premiums and contributions) for a maximum of 24 months. The exemption is capped at €500 per month for each worker.
If the hire is made in a business location or production unit in the regions of Abruzzo, Molise, Campania, Basilicata, Sicily, Puglia, Calabria, or Sardinia, the maximum monthly exemption increases to €650 per worker.
This exemption does not apply to domestic work or apprenticeships (although it does apply if the previous apprenticeship was not continued with a permanent contract).
The incentive cannot be combined with other exemptions or reductions in financing rates provided under current regulations. However, it can be combined, without reduction, with the increased deductible cost for new hires under Article 4 of Legislative Decree No. 216 of December 30, 2023.
WOMEN’S EMPLOYMENT INCENTIVE
Article 23 of DL 60/2024 provides private employers with a contribution exemption for hiring women.
The exemption is 100% of the social security contributions owed by the employer, up to a maximum of €650 per month (excluding INAIL premiums and contributions) for each female employee hired on a permanent contract between September 1, 2024, and December 31, 2025, provided they belong to one of the following categories:
- Women of any age who have been without regular employment for at least six months and reside in regions within the Special Economic Zone (ZES) for Southern Italy;
- Women of any age who have been without regular employment for at least six months in areas with a significant gender employment gap;
- Women of any age who have been without regular employment for at least 24 months, regardless of residence.
The exemption is applicable for up to 24 months and does not apply to domestic or apprenticeship contracts. Furthermore, the hires must result in a net employment increase, calculated as the difference between the number of workers employed in each month and the average number of workers employed in the previous 12 months. For part-time employees, the calculation is adjusted based on the ratio of hours worked to the normal full-time hours.
The increase in employment is calculated net of any reductions in the workforce in affiliated or controlled companies under Article 2359 of the Italian Civil Code, or by the same entity, directly or indirectly.
This incentive cannot be combined with other exemptions or reductions in financing rates provided under current regulations, but it can be combined, without reduction, with the increased deductible cost for new hires under Article 4 of Legislative Decree No. 216 of December 30, 2023.
ZES BONUS (Special Economic Zone for Southern Italy)
Article 24 of DL 60/2024 introduces a contribution exemption for hires in ZES regions.
Private employers with up to 10 employees, who, between September 1, 2024, and December 31, 2025, hire workers aged 35 or older, who have been unemployed for at least 24 months, in a business location or production unit in one of the regions within the ZES for Southern Italy (Abruzzo, Molise, Basilicata, Campania, Puglia, Calabria, Sicily, and Sardinia), are eligible for this exemption. This applies to permanent contracts and excludes managerial, domestic, and apprenticeship contracts.
To qualify, employers must not have made individual dismissals for justified objective reasons or collective dismissals in the same production unit within the six months preceding the hire (in accordance with Law No. 223 of July 23, 1991).
The exemption covers 100% of the total social security contributions owed by private employers (excluding INAIL premiums and contributions), up to a maximum of €650 per month per worker, for a maximum period of 24 months.
This incentive cannot be combined with other exemptions or reductions in financing rates under current regulations but can be combined, without reduction, with the increased deductible cost for new hires under Article 4 of Legislative Decree No. 216 of December 30, 2023.
Conclusion
The bonuses described above aim to promote stable employment through more secure contracts and expanded opportunities.
