Foreign employers operating in Italy face a tightening compliance environment. Revised employment legislation took effect at the start of 2025, introducing reinforced obligations around employment contracts, collective agreement alignment, and termination procedures. Companies that have not yet audited their Italian workforce arrangements risk enforcement action, financial penalties, and exposure in labour proceedings.
Italy's updated employment regulations impose new written-disclosure requirements on employment contracts, tighten the link between pay and applicable collective agreements, and strengthen procedural rules governing dismissal notice and termination procedure. The changes apply to all employers – including foreign entities without a permanent establishment – that engage workers under Italian employment legislation. Compliance is required immediately; labour inspectorates began enforcement activity in the first quarter of 2025.
This alert outlines what changed, which organisations are in scope, and the specific steps foreign employers should take without delay. For a comprehensive review of Italian employment obligations, see our dedicated page on employment law in Italy.
What changed – the regulatory development and effective date
Italy's employment legislation was amended through a package of labour-market measures that entered into force on 1 January 2025. The principal changes affect four areas.
Written employment contract disclosures. Employers must now provide each worker with an extended written statement at the point of hiring. The statement must cover working hours, probationary periods, remuneration structure, and applicable social security registration details. The disclosure deadline is the first day of work – not within a grace period as under prior rules.
Collective agreement alignment. Under Italian employment legislation. Employers are required to apply a contratto collettivo nazionale di lavoro (CCNL. national collective labour agreement) that is genuinely representative of the sector in which the worker is employed. The 2025 amendments tighten the definition of representativeness and impose liability on employers who apply a non-representative CCNL to reduce wage costs. Foreign employers that selected a peripheral collective agreement during Italian market entry are particularly exposed.
Dismissal notice and termination procedure. The revised rules extend mandatory dismissal notice periods for workers with more than three years of continuous service. They also require that any termination procedure be accompanied by written documentation confirming the grounds, the notice period applied, and the social security regularisation status of the departing employee. Oral or informally communicated dismissals are now expressly void under Italian employment legislation.
Social security contribution reporting. Employers must submit updated social security registration data for all workers – including those engaged through secondment or remote arrangements – within 30 days of the regulations' effective date. Foreign employers that rely on home-country social security coverage must provide documentary evidence of the applicable bilateral agreement or EU coordination rule.
Who is affected – threshold criteria and business categories
The regulations apply broadly. The following categories of foreign employer are in scope.
- Companies incorporated outside Italy that employ one or more workers habitually performing duties on Italian territory
- Foreign entities that have seconded employees to Italy for assignments exceeding 30 days in any rolling 12-month period
- Businesses operating through Italian branches, representative offices, or project sites – regardless of whether a permanent establishment exists for tax purposes
- Foreign employers engaging workers remotely from Italy under Italian-law contracts or de facto Italian working arrangements
There is no minimum headcount threshold. A single employee working from Italy brings the full body of obligations into scope. Companies in sectors covered by high-representation CCNLs. including manufacturing, technology, professional services. Additionally, logistics. face the most immediate exposure. Because the 2025 collective agreement alignment rules are actively monitored by the Ispettorato Nazionale del Lavoro (INL – National Labour Inspectorate).
The INL has announced a programme of targeted inspections focusing on foreign-origin employers during 2025. Penalties for non-compliance with the written disclosure and collective agreement rules are calculated per affected worker and can accumulate quickly across a workforce of even modest size. Foreign employers with Italian corporate structures should also review related obligations under corporate law in Italy, as directors of Italian entities can incur personal liability for certain labour violations.
To receive an expert assessment of your Italian employment obligations and exposure, contact us at info@ferrazwhitmore.com.
What to do now – immediate actions and compliance timeline
Foreign employers should treat the following steps as time-sensitive.
1. Audit all existing employment contracts. Review every Italian-law employment contract against the updated written-disclosure requirements. Contracts that pre-date 1 January 2025 and do not contain the required disclosures should be supplemented with a written addendum. This should be completed within 60 days of the regulations' effective date to demonstrate good-faith compliance before any inspection.
2. Verify the applicable collective agreement. Confirm that the CCNL applied to each worker corresponds to the employer's actual sector of activity under the updated representativeness criteria. Where a non-representative agreement is currently in use, legal advice should be obtained before switching agreements – the transition itself can trigger back-pay exposure for the period of non-conformity.
3. Review and document all pending termination procedures. Any dismissal process underway or contemplated must comply with the new written-documentation requirements. Verify that dismissal notice periods reflect the updated rules for workers with more than three years of service. Incomplete or oral dismissal processes should be formalised in writing immediately.
4. Regularise social security filings. Confirm that all workers – including seconded and remote employees – are registered with the correct Italian social security authority, or that valid documentation supporting home-country coverage is on file. Missing or outdated filings should be corrected before the 30-day submission window closes.
5. Brief HR and management teams. Internal decision-makers responsible for Italian workforce matters should be informed of the new rules without delay. Missteps in employment contract formation or termination procedure are among the most common – and most costly – errors made by foreign employers entering or scaling in Italy.
Companies that identified potential non-compliance during the above review should obtain legal advice before approaching the labour inspectorate voluntarily. In a number of recent inspection cycles, employers who self-disclosed irregularities before formal proceedings were opened received reduced penalty assessments under Italian employment legislation. Waiting for an inspection to reveal the issue removes that option. For cross-border employment developments in a related jurisdiction, our alert on employment regulations in Portugal addresses comparable changes at the Iberian level.
About Ferraz & Whitmore
Ferraz & Whitmore is an international law firm based in Lisbon, advising business clients across 46 jurisdictions. Our employment law practice supports foreign employers entering or operating in Italian and broader European markets, covering employment contract drafting, collective agreement compliance, termination procedure, and social security structuring. The firm's attorneys have advised on cross-border workforce matters in both civil law and common law systems, and our Lisbon base provides direct access to EU regulatory frameworks that underpin Italian labour obligations. We work with international entrepreneurs, multinational HR teams, and in-house legal counsel who need results-oriented advice across multiple legal systems. To discuss your Italian employment compliance situation, contact us at info@ferrazwhitmore.com.
Disclaimer: This publication is provided for informational purposes only and does not constitute legal advice. The information herein should not be relied upon as a substitute for professional legal counsel tailored to your specific circumstances. Ferraz & Whitmore assumes no liability for actions taken or not taken based on the contents of this material. For advice regarding your particular situation, please contact info@ferrazwhitmore.com.