Currency CurrencyEuro (EUR) Working Time Work Week40 hours Employer Taxes Employer Taxes approx. 30%

Hire in Italy

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Italy’s labour force is the fourth largest in the EU. Roughly 63% of working Italians are employed in the service sector. Similar to Spain and Greece, Italy’s unemployment rate continues to be very high: In 2020, roughly 9.3% of the country’s labour force was without a job. 

With such a high number of skilled workers looking for a job, international companies have a large pool of possible job candidates to choose from. Also when it comes to costs of employment, Italy is an attractive option for companies looking to hire remote employees: With average hourly labour costs being estimated to amount to roughly EUR 28.80 (Eurostat 2019), hiring in Italy is around 20% cheaper than in other European countries such as Germany or Sweden. 

Basic Facts about Italy

  1. official state name Italian Republic (Repubblica Italiana)
  2. capital Rome
  3. population 60.5 million
  4. language Italian
  5. currency Euro (EUR)
  6. currency UTC +1
  1. Show public holidays
    01 Jan New Year's Day
    06 Jan Epiphany
    04 Apr Easter Sunday *
    05 Apr Easter Monday *
    25 Apr Liberation Day
    01 May Labour Day
    02 Jun Republic Day
    15 Aug Assumption Day
    01 Nov All Saint’s Day
    08 Dec Immaculate Conception
    25 Dec Christmas Day
    26 Dec Saint Stephen

    * movable holiday

Employment Contract

Although not legally required – in fact, a written note outlining the terms of employment provided to the newly hired employee is sufficient – it is best practice to draft a written employment contract which should at least contain the following information: 

  • Identification of both parties 
  • Date of commencement and employment duration – for temporary contracts 
  • Workplace
  • Description of the position 
  • Base salary as well as other compensation or benefits
  • Working hours 
  • Probation period
  • Total number of holidays
  • Notice periods for employment termination
  • Legal grounds
  • Reference to collective agreements

Employment contracts in Italy are generally considered to be permanent but legislation also allows fixed-term contracts where appropriate. The maximum length for short-term contracts is twelve months – extendable to 24 months under certain conditions. 

Probation Period

The length of the probation period depends on the employee’s position. For normal employees, probation periods of two months are common while managers are usually subject to a six months’ trial period.

Working time

Working Hours and Breaks

Limitations on daily and weekly working time are set by Italian labour law and collective agreements as follows:

As a standard, employees in Italy are usually required to work 40 hours per week unless there is a collective agreement in place which limits weekly working time even further. Although the distribution of working hours over the week is quite flexible, eight-hour workdays are quite common. 

Rest periods are to be organised according to the following principles:

  • a minimum of 24 consecutive hours of rest over a seven-day period – usually Sunday
  • a minimum daily rest period of eleven hours
  • where working time exceeds six consecutive hours, a break of at least ten minutes is mandatory

In no case should an employee’s weekly working time exceed 48 hours – including overtime.


Any work performed beyond 40 hours is generally considered overtime. Overtime pay is subject to  regulations set out by a collective agreements.


Employees in Italy usually get paid on a monthly basis with payments issued around the 27th of each month.

Minimum Wage

Italian legislation does not provide for a minimum wage, neither on national nor on regional level. However, collective agreements generally set minimum standards for employee remuneration in the corresponding industry.

Sick Pay

Sick pay and sick leave in Italy are subject to the regulations agreed on in form of collective agreements. In most industries, the permissive sick leave period ranges from six to twelve months during which the employee is protected from dismissal and entitled to sick pay.

Generally, the first three days of sick leave are paid in full by the employer.Thereafter, employees usually continue receiving full pay but with social security covering at least a part of the employee’s sick pay – if not all of it.


Some collective agreements might mandate the payment of a 13th and / or 14th salary

Taxes and Social Security Contribution

Employees and employers in Italy are subject to the following tax rates and social security contributions (rates valid for 2022) which are distributed between pension, unemployment, sickness, maternity and social mobility funds:


24% corporate tax rate

22% VAT (standard rate)

taxation for digital services (since January 2020): 3% of annual gross revenue for groups with an annual turnover exceeding EUR 750 million


Individual income tax rates:

up to EUR 15,000: 23%;up to EUR 28,000: 25%; up to EUR 55,000: 35%; over EUR 55,000: 43%

Additional regional and municipal taxes may apply.

social security

contribution rates depend on the company’s sector of activity and the employee’s position but are generally around 30%


employee contributions to social security depend on industry and job title but are generally around 10%

Employee Benefits

Annual Leave

The minimum annual leave entitlement in Italy is four weeks. Depending on the employee’s level of seniority, collective agreements may provide for additional vacation days. Employees are usually free to decide when they want to use their annual leave but employers are allowed to put restrictions into place in order to ensure vacation schemes are compatible with the company’s needs. 

In addition, the country observes twelve public holidays. National holidays that fall on a Sunday – except Easter Sunday – are shifted to the following Monday unless employee and employer agree on an extra day’s pay instead.

Maternity Leave and Paternity Leave

Female employees are entitled to five months of maternity leave which can be split as follows:

  • two months before and three months after delivery
  • one month before or four months after giving birth

During this time, the mother receives the equivalent of her usual salary, of which 80% are paid by INPS (the Italian social security body) while the employer covers 20% of the employee’s pay.

Since January 2020, fathers are allowed to take seven days of fully paid paternity leave within the first five months after their child’s birth. Additionally, they have the right to take over any unused days of maternity leave if the mother returns to work before her maternity leave period is over. In this case, fathers enjoy the same rights and receive the same payment as the mother would have done. 

Parental Leave

Mothers and fathers have the right to claim six months of parental leave – in total limited to eleven months per child – until their child reaches the age of twelve. In addition, parents are allowed to take unpaid time off if their child is sick – as long as the child is under eight years old. 

Additional Leave and Benefits

Employees further have the right to three additional days off per year in case of serious illness or death of a spouse or close family member. In cases where caring needs for a dependant family member are documented, Italian law provides for three days of paid leave per month. In severe cases, employees may claim up to two years of extraordinary leave to care for a sick family member during which they receive payments from the Ministry of Labour. 

Other leave entitlements include study and training leave which is granted to employees with no less than five years of service, student employees or in accordance with collective agreements.

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Employment termination

In addition to employment termination by default – i.e. in case of a fixed-term contract – or mutual consent, Italian labour law provides for the following reasons for employee dismissal:

  • permanent absence from work or permanent disability to perform the agreed work
  • personal reasons such as underperformance or misconduct
  • collective redundancies and other objective, company-related reasons

Employees can be dismissed immediately without prior notice on the grounds of gross misconduct. In all other cases, notice periods for both employees and employers depend on the employee’s role: Notice periods for employers are usually 30 days for normal employees and 60 days for managers.

Even employees who are dismissed for just cause, i.e. gross misconduct or other, and those resigning from their job are entitled to severance pay equal to the accumulated amount in the employee’s severance fund. As a rule, employers are obligated to set aside around 7.5% of the employee’s annual salary for this purpose. 

Hiring in Italy?

Not sure if you should start with a contractor or go ahead and hire a full-time teammate in Italy? The Lano platform makes it easy to go from freelance to full-time employee. Get expert guidance from the Lano team to compare your options and keep growing.