Law No. 234 of Dec. 30, 2021, "State Budget for the Financial Year 2022 and Multiyear Budget for the Three-Year Period 2022-2024," published in the Official Gazette No. 310 of Dec. 31, 2021 (henceforth, "Budget Law 2022"), introduces important changes in the field of social safety nets during employment compared to the regulations contained in Legislative Decree No. 148 of Sept. 14, 2015.
Also playing a relevant role in the reorganization of the regulations on social shock absorbers are the provisions on wage subsidies introduced by the Sostegni ter Decree (Decree Law No. 4 of January 27, 2022). In particular, under the Sostegni ter Decree, employers in the identified sectors under the ATECO codes indicated in Annex I to the Decree who, from January 1, 2022 to March 31, 2022, suspend or reduce their work activity pursuant to Legislative Decree No. 148 of September 14, 2015, are exempt from the payment of the additional contribution referred to in Articles 5 (CIGO and CIGS) and 29, paragraph 8 (FIS), of Legislative Decree No. 148 of September 14, 2015.
It should be noted that, as clarified by INPS in Circular No. 18 of Feb. 1, 2022, the changes made take effect on applications for treatments for which the beginning of the reduction/suspension of work activity is on or after Jan. 1, 2022.
Below are the main new features:
- (a) Ordinary Wage Supplementation Fund
The Budget Law 2022 expands the scope of the recipients of the Wage Guarantee Fund by including home-based workers and apprentices hired for qualification or higher education and research. In this regard, it states: "for thepurposes of determining employee limits, all workers, including managers, home-based workers and apprentices, who work in a subordinate capacity both inside and outside the company are to be included in the calculation" (...); thus, Budget Law 2022 intervenes to amend Article 1 of Legislative Decree No. 148 of September 14, 2015.
In addition, some of the requirements for accessing the Cigo are changing; for the recognition of wage subsidies applied for as of January 1, 2022, the minimum length of actual work that workers must have on the date of application is 30 days; otherwise, prior to this new legislation, workers were required to have at least 90 days of actual work on the date of application in order to access support.
A single ceiling (for the year 2021, equal to 1,199.72 euros), annually revalued according to ISTAT indexes, is introduced for treatments related to periods of suspension or reduction of work activity starting from January 1, 2022.
The Sostegni ter Decree (Art. 23), on the other hand, introduces novelties regarding regulatory aspects, such as the possibility of differently organizing the territorial competencies of Cigo authorization in the hands of INPS.
- (b) Extraordinary redundancy fund
The changes affect not only the ordinary Wages Guarantee Fund but also the extraordinary Wages Guarantee Fund. INPS, in Circular No. 18 of Feb. 1, 2022, points out that the Cigs is one of the institutions most affected by the reorganization of the regulations on layoffs.
In relation to scope, as of Jan. 1, 2022, the CIGS regulations and related contribution obligations apply with reference to:
a) to employers who, in the previous six-month period, employed an average of more than 15 employees and who operate in sectors not covered by the Bilateral Solidarity Funds referred to in Articles 26, 27 and 40 of Legislative Decree No. 148/2015. For the purpose of determining company size, again, all workers, including managers, homeworkers and apprentices, who work in a subordinate capacity both inside and outside the company must be included in the calculation.
b) to air transport and airport management companies and companies derived from them, companies in the airport system, as well as political parties and movements and their respective branches and territorial sections, provided that they are registered in the register referred to in Article 4, paragraph 2, of Decree-Law No. 149 of December 28, 2013, converted with amendments into Law No. 13 of February 21, 2014.
The range of employers covered by the extraordinary wage supplementation treatment is significantly expanded. In fact, in addition to those already included, those operating in all other sectors where Bilateral Solidarity Funds have not been established under Articles 26, 27 and 40 of Legislative Decree No. 148/2015 are also included.
With reference to the "reasons" that can be used for the purpose of access, the Budget Law 2022 provides a broader interpretation of the reason for "corporate reorganization," including cases in which companies must "carry out transition processes," which will, then, be identified specifically by Decree of the Minister of Labor and Social Policy.
It is still worth mentioning that the Budget Law 2022 provides, on an exceptional basis, two additional possibilities for extraordinary wage supplement intervention (Article 1, paragraphs 200 and 216). In the case of (i) employment transition agreement, the company involved, at the end of the extraordinary wage supplement intervention for the reasons of reorganization and business crisis, may benefit, as an exception to the maximum duration limits of the CIGS treatment, of an additional 12 months of treatment aimed at the employment recovery of workers at risk of redundancy. In addition, (ii) in case of reorganization processes and situations of particular economic difficulties of the company involved, it is possible, in order for the latter to cope with such scenarios, to apply for an additional extraordinary wage supplement treatment, again as an exception to the maximum limits of the duration of the treatment.
- (c) Bilateral solidarity funds
As of January 1, 2022, employers who are not covered by the Wage Supplementation Fund and who employ at least one employee will have to ensure, through bilateral solidarity funds, protection during employment in cases of reduction/suspension of work activity for the ordinary and extraordinary reasons provided for in the Wage Supplementation Regulations.
According to INPS's clarification, for Funds already established as of December 31, 2021, a transitional period is provided for adjusting to the new provisions, by December 31, 2022; in case of failure to adjust, employers in the relevant sector will merge, as of January 1, 2023, into the Wage Supplementation Fund (FIS), to which the contributions already paid or otherwise due by the same employers will be transferred. In addition, the Bilateral Solidarity Funds referred to in Article 26 of Legislative Decree No. 148/2015, established in the period between January 1, 2020 and December 31, 2021, will be able to adjust to the new provisions by June 30, 2023.
- (d) Fis
As of January 1, 2022, employers who employ at least one employee, who do not fall under the scope of Article 10 of Legislative Decree No. 148/2015, i.e., the Ordinary Wages Guarantee Fund, and who are not recipients of the protections guaranteed by the Bilateral Solidarity Funds referred to in Articles 26, 27 and 40 of the same Legislative Decree, are subject to the rules of the Wages Integration Fund.
As clarified by the INPS Circular already cited, the provision broadens the range of those protected by the FIS, which, without prejudice to its residual nature, prior to the reorganization of the legislation guaranteed employers not recipients of the provisions of Title I of Legislative Decree No. 148/2015 (CIGO or CIGS), nor of the protections of the Bilateral Solidarity Funds referred to in Articles 26, 27 and 40 of the same legislative decree, with company size averaging more than five employees in the previous six months.
