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Labor reform: not just article 18

ALL THE NEWS ON CONTRACTS AND SOCIAL BUFFERS - THE COMPLETE TEXT OF THE REFORM IS ATTACHED - The Government focuses on permanent contracts, which young people will access through the apprenticeship channel - Fixed-term contracts more expensive for companies - Restrictions on VAT numbers - In arrival of Aspi and mini-Aspi.

Labor reform: not just article 18

THEarticle 18 changes and remains at the center of the comments, but in the labor reform we are not just talking about layoffs. The bill developed by the government, and now ready to be discussed in Parliament, is also based on two other fundamental pillars: the reorganization of contracts and social safety nets.

Here's what's new: 

 

CONTRACTS

The indefinite time. "The goal is to make the permanent employee contract the dominant one that begins with the apprenticeship phase, which we intend to give emphasis to," Minister Fornero explained yesterday. In essence, the bet is to encourage permanent hiring by making precarious contracts more expensive and rewarding companies that stabilize workers, but also by making layoffs easier, so that companies no longer have any "alibi" for not assume.

The apprenticeship. The minimum duration of the contract is six months, but the canonical one reaches three years. At the end of this period, the crossroads: the company will be able to choose whether to end the relationship with the apprentice or stabilize it with a permanent contract. However, the right to take on apprentices will only be granted to those companies that "have taken on at least 50% of their apprentices in the last three years", Fornero underlined. For the first three years after the entry into force of the law, however, "we will settle for 30%". The ratio between the number of apprentices and "skilled workers in service" rises from 1/1 to 3/2.

The fixed time. "We have eliminated the so-called 'causalone' for the first fixed-term contract, and it is an important liberalisation", said the minister. This means that the first contracts "lasting no more than six months" can be terminated even without the need to indicate the precise reason for the dismissal. The contribution rate on these contracts is raised to 1,4%, and the extra proceeds will be used to finance the new Aspi. However, there is a stabilization bonus: in the event of permanent employment, the rate is returned to the companies for an amount equal to six months of contributions. 

The period of time to elapse between one contract and the next increases from 10 to 60 days for relationships that last less than six months and from 20 to 90 days for those that last longer. The insertion contract disappears, while for co.co.pro an increase in the INPS contribution rate is envisaged, in order to bring it closer to that envisaged for employees (33% in 2018). Furthermore, if the precise definition of the project is missing in the contract, the permanent contract will automatically start. 

VAT numbers. For those who mask a subordinate employment relationship comes the obligation to hire. However, this rule will not be valid immediately, but only after a year from the entry into force of the reform. This is a concession from the Government to the requests of the entrepreneurs. 

SOCIAL SHOCK ABSORBERS

Aspi, the new unemployment benefit. The resources allocated for the new shock absorbers should be worth 1,8 billion. The social insurance for employment will gradually replace all forms of mobility and will become fully operational in 2017. It will apply to all employees with a fixed-term contract, but to be entitled to it, you must have at least two years of insurance seniority and 52 working weeks in the last two years. The amount will be equal to 75% of salaries up to 1.150 and 25% beyond this threshold, but the maximum allowance will be 1.119 euros gross per month. The standard duration of treatment will be 12 months: only for those over 55 it will reach 18 months. The contribution rate should be 1,3% (2,7% for precarious workers). 

The mini-Aspi. It will be reserved for those who have not matured the requirements for the traditional Aspi and will have a lower amount than this. Precarious workers will not be entitled to it, but only those with a subordinate employment contract. 

Solidarity fund for the over 58s. With the new pension reform, one can no longer hope to retire from work before the age of 66-67. On the other hand, those who lose their jobs and are already old age have very little hope of finding another one. For these people comes a solidarity fund covered by the companies, which will thus use at least part of the rate they will save on mobility allowances, destined to disappear. 

Against blank resignations for women. During maternity and up to the first three years of the child's life, resignations and consensual terminations of the contract will have to be examined by the Ministry of Labour. The abuses will be punished with fines ranging from 5 to 30 euros.  


Attachments: Labor Market Reform.pdf

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