The so-called “Decreto Ristori”: the most important employment law news

Prepared by Francesca Tironi, Giulia Spalazzi and Alessandro Ferrari

The so-called “Ristori Decree” (Law Decree no. 137, October 28th, 2020) – approved by the Council of Ministers during the meeting n. 69 of October 27th – has been published in the Official Gazette.

With regard to employment law provisions, the most important news range from the possibility for companies to benefit (under certain conditions) from additional 6 weeks of shock-absorbers due to Covid-19; the to the extension of the dismissal’s ban (except for particular company’s situations) until January 31st, 2021; and to the exemption from social security contributions in favor of some employers, for a maximum period of 4 months.

In detail, with reference to shock-absorbers due to Covid-19, employers who have fully benefited from the treatment at hand for the nine-weeks period provided for by the so called “August Decree“, as well as those belonging to sectors affected by the measures that provide for the closure or limitation of activities, can submit (to the National Social Security Institute, by the end of the month following that in which the period of suspension or reduction of work began) the request to be granted with the shock-absorber treatment for a maximum duration of six weeks, within the period between November 16th, 2020 and January 31st, 2021. As for the additional contribution to access it, this will be calculated by comparing the company’s revenues for the first half of 2020 and the corresponding half of 2019, and the related amount will be i) equal to 9% of the total salary that would have been due to the employee for the hours not worked, for employers who had a reduction in revenues of less than 20%; ii) equal to 18% of the total wage, for employers who had no reduction in revenues; iii) not due by a) employers who had a reduction in revenues of 20% or more; b) employers who have started a business after January 1st, 2019; and c) employers in the sectors affected by the measures ordering the closure or limitation of activities.

Under a different point of view, the “Ristori Decree” specifies that until January 31st, 2021 the following activities are precluded: i) the start of collective dismissal procedures, as well as those already initiated on February 23rd (except in cases where the dismissed employees are rehired following the takeover of a new contractor); and ii) the termination of employment relationships for justified objective reasons (also remaining suspended any procedures in progress). Without prejudice to the above, however, it is specified that these exclusions and suspensions do not apply i) in case of dismissals motivated by the definitive termination of the company’s activity, resulting from the liquidation of the company without continuation, even partial, of the activity, in cases where during the liquidation there is no transfer of business; ii) in case of a collective agreement aimed at encouraging to terminate the employment relationship by means of a financial incentive; iii) in case of dismissals in the event of bankruptcy, when the provisional business continuity of the company isn’t foreseen, or the termination is ordered; and finally iv) in case of dismissals served within the sectors not included in the branch of the company possibly subject to provisional business continuity.

Finally, as anticipated, private non-agricultural employers who do not ask for the shock-absorber treatment are granted with an exemption from the payment of social security contributions at their expense (without prejudice to the rate of calculation of pension benefits), for an additional maximum period of four weeks, usable by January 31st, 2021, within the limit of the hours of shock-absorber treatment already enjoyed during June 2020, excluding prizes and contributions due to the National Institute for Occupational Accidents Insurance.

Let’s Talk

For a deeper discussion, please contact:

Francesca Tironi

PwC TLS Avvocati e Commercialisti

Associate Partner

Giulia Spalazzi

PwC TLS Avvocati e Commercialisti

Senior Manager