
Episode 10: Payroll in Italy
Italy’s payroll system is shaped by employee-friendly laws, collective bargaining agreements, and frequent regulatory changes. With regional variations and evolving labor laws, staying informed is key—especially as businesses focus on upskilling their workforce to address skilled labor shortages.
Listen to the episode
Timestamps
- Intro [00:07]
- What do you love about payroll in Italy? [04:07]
- Italy’s economy [04:44]
- Compliance challenges [08:49]
- The importance of second-level agreements [12:00]
- Social security contributions [16:38]
- How ADP is helping clients navigate compliance challenges [19:08]
- The DURC certificate [20:35]
- Labor consulting firms [23:35]
- Andrea’s story [25:32]
- The skilled labor shortage and upskilling [29:00]
- The demand for flexible and remote working options [31:34]
Payroll in Italy
Italy is a key player in the European economy, famous for its rich cultural heritage, stunning landscapes, and iconic cuisine. From Milan’s fashion houses to the industry centers of Turin, Italy’s economy is characterized by a dynamic mix of manufacturing, tourism, and agriculture. The European country is also one of the world’s top wine producers, along with France. Its employee-friendly work culture also means that employers have to expect collective bargaining agreements, negotiations with unions, and diverse social security contributions.
Italy’s payroll system is characterized by a combination of national legislation and sector-specific collective bargaining agreements. On top of that, employers and unions often negotiate so-called secondary agreements, which are additional benefits that are negotiated on behalf of employees. The nature of these agreements also varies depending on location and industry, which means that employers need to stay informed about the specific agreements relevant to their sector to ensure compliance and fair compensation.
Employers are responsible for withholding and remitting various taxes and social security contributions. Regulations surrounding these contributions can also change rather quickly, and employers need to be prepared to properly apply the new rules within a short time frame. Accurate calculation and timely payment of these obligations are crucial to avoid penalties and ensure legal compliance. Audits are also very common, which means that businesses must keep accurate records of all time-and-attendance, employment, and payroll-related activities. ADP’s legal watch department keeps track of any changes announced by the Italian authorities and helps clients stay ahead while updating any relevant systems to include the new regulations.
“Our legal watch department has a set of specialists that are dedicated to understanding the relevant changes in the labor legislations that happen every month, whether these are regional laws, local legislation, or national ones.“
Innocenzo Casanova, Head of Service Operations, ADP Italy
Employers must also ensure that they stay on top of obtaining and updating their Single Document of Contribution Regularity (DURC), a mandated certificate that indicates a business has been making correct and timely social security contributions and is otherwise fiscally sound. Without this certificate, businesses can face high penalties and even a mandated stop to all operations, resulting in significant losses.
Despite Italy’s economic strengths, the country continues to suffer from a skilled labor shortage, particularly in sectors such as tech and IT, as well as manufacturing, engineering, and healthcare. In order to combat this issue, many businesses have started upskilling and training their existing workforce in order to future-proof them. In fact, Italian employers are required to offer some degree of training opportunities to employees, but many employers may go beyond official requirements to upskill their workforce.
In this episode of Payroll Around the World, we’re joined by Marcela Uribe, General Manager for ADP Southern Europe and Africa, and Innocenzo Casanova, Head of Service Operations for ADP Italy, who help us break down the intricacies of Italian payroll and the country’s complex labor landscape. They cover what employers must keep in mind when dealing with unions, labor laws, and social security contributions, while also shedding light on strategies for employers to retain and attract talent.
Italy is a diverse economy with a lot of potential for multinationals looking to make their mark in Europe. With ADP, clients can explore the possibilities of the European Union’s third-largest economy while remaining assured that they’ve got a reliable, flexible partner who will help them stay compliant on all national, regional, and local levels.
transcript
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Luisa Rollenhagen (00:07)
Hello and welcome to another episode of Payroll Around the World! I’m your host Luisa Rollenhagen.
This audio series is your in-depth guide to exploring the intricacies of global payroll. Each episode spotlights a specific country and features interviews with ADP experts on the ground, as well as locals who share their perspectives on work and pay in their homeland.
After all, payroll can’t truly be global if it isn’t local as well.
Today, we’re going to Italy. Known for its rich cultural heritage, stunning landscapes, and iconic cuisine, Italy is also a key player in the European economy. From Milan’s fashion houses to the industry centers of Turin, Italy’s economy features a dynamic mix of manufacturing, tourism, and agriculture. Wine lovers also hold a special place in their hearts for Italy, since the country is neck and neck with France for the title of the world’s largest producer of wine.
Italy’s economy is also characterized by its employee-friendly nature, with laws and regulations emphasizing workers’ rights. This also means that there’s a high number of collective bargaining agreements that employers need to be aware of.
Marcela Uribe (01:30)
So the running joke ever since I moved to Italy is that if you go to a dinner party and there’s six people sitting around the table, you’ll have six different collective agreements sitting at the table.
Luisa Rollenhagen (01:41)
That employee-friendly labor landscape I just mentioned? It also means that social contributions tend to be quite plentiful, which can add complexity to payroll calculations.
Innocenzo Casanova (01:52)
Payslips in Italy have an overall 120 fields to explain how the taxations and contributions are applied to wages and so on. 50% of those fields are dedicated to taxation and contributions to social security. So you can understand the level of complexity around that.
Luisa Rollenhagen (02:14)
Italy is also currently experiencing a skilled labor shortage in certain fields, which is why employers are encouraged to upskill their existing labor force and offer various training opportunities for their employees. It’s a win-win situation for both employees and employers.
Andrea (02:30)
So I wanted to study and to improve my skills. And since I already studied two years ago and paid by myself, I asked them to pay for this course because when I work for them as a speaker in the agency, they save a lot of money.
Luisa Rollenhagen (02:47)
That’s Andrea, a copywriter in Milan whose employer paid for him to attend training for voiceover speakers. He’s going to tell us more about his experiences shortly.
But first, I’d like to introduce our experts for this episode. You’ve just heard a little preview from both of them, and they’re going to guide us today as we explore the ins and outs of payroll in Italy.
Welcome, Marcela and Innocenzo!
Marcela Uribe (03:11)
Hi everyone. I’m Marcela Uribe and I am the general manager for ADP’s Southern Europe and Africa region. I am currently based in Milan, Italy, and if I talk a little bit like a lawyer throughout this conversation, I apologize in advance. The disclaimer being that I am indeed a lawyer or maybe better I’m a recovering lawyer, but I suppose once a lawyer, always a lawyer, and view the world a little bit through that lens. But happy to have made the switch over here to the business side, but I’ll try to keep the legalese in check.
Innocenzo Casanova (03:47)
Hi everyone, my name is Innocenzo Casanova. I’m the head of service operations in Italy. I’m based in Milan, which is our headquarters, with Marcela.
Luisa Rollenhagen (03:58)
Thanks for joining us today!
So I’d like to start us off by asking: What do you two find exciting about working in payroll in Italy?
Innocenzo Casanova (04:07)
What I love is the passion and really the love and dedication that all of my team members are doing every day. So when I see the passion to deliver this business every month, the level of commitment, it is really great. And when there are problems or issues, how those get fixed by them with the same level of dedication.
Marcela Uribe (04:31)
I guess I would say there’s never a dull moment, right? And maybe I’ve said that somewhere before, but maybe that’s just payroll everywhere. I feel like payroll is constantly evolving and constantly changing, so you’re not going to get bored anytime soon.
Luisa Rollenhagen (04:44)
That’s certainly true. And since you just said “constantly evolving,” perhaps you could give us an overview of what’s currently going on with Italy’s economy?
Marcela Uribe (04:55)
So the Italian economy in particular, I think, compared to some of the other countries in the Eurozone, appears really rather positive. So we really had a tough go of it here through the pandemic. It was probably the first country in Europe that was really impacted and went into lockdown, and so it took us a little while to get out, but the economy is really in pretty decent shape. So GDP is increasing moderately, but it is growing at the same pace, in fact as the French economy and at this point right now it’s performing a little bit better than Germany. So I feel like right now the Italian market or whether it’s the economy as a whole or the labor market is certainly in pretty good shape because also unemployment has really stabilized, we’re at about 6.2%. It’s gone up and down over the course of the last year a little bit, but I don’t think it reached above 6.7. It’s really been pretty stable. We’re really at record high levels of employment and record low levels of unemployment and inactivity. So people are working, and what’s really, I would say encouraging is that the labor market is projected to grow, it’s projected to continue to grow over the next couple of years. So it feels like we’re on a good trajectory, I would say.
Innocenzo Casanova (06:19)
And another important point related to this is that what we see as a trend is that the group, company groups, are changing, they are incorporating companies and so workers, employees coming from different maybe industries or branches. So there is a very good mix maybe if one group is composed by three to four different local entities that are bringing different types of workers together. So the complexity is there and so spinoff and acquisitions is a trend that is, for us, is very from one side a new kind of new business for us, but also a level of complexity to be managed that requires also our side, ADP side, some skill and capabilities more related to project management, program management, kind of skills instead of pure payroll specialists that were more in the past.
Luisa Rollenhagen (07:19)
Ah I see, so companies are getting bigger and incorporating different kinds of workers?
Marcela Uribe (07:24)
So I’ll pick up a little bit on what Inno was just saying a second ago about, as companies are expanding or maybe creating new legal entities and having sort of different kinds of workers, what that means for a multinational coming into Italy is that these different types of groups or different types of workers that they’ll have could effectively or potentially have multiple different collective labor agreements within the same company. So the running joke ever since I moved to Italy, is that if you go to a dinner party and there’s six people sitting around the table, you’ll have six different collective agreements sitting at the table.
Luisa Rollenhagen (08:02)
That sounds like it could get a bit complicated!
Marcela Uribe (08:05)
So the Italians love their complexity and so it is layers of complexity, but it’s something to be absolutely aware of because just because you are one organization in one industry doesn’t mean that you will be limited to one collective agreement. It really is specific to the types of work. So it’s not unusual to have these different agreements within the same organization. So that’s something that I think is particular to Italy. I mean everybody’s got collective agreements, but this level of complexity is something I haven’t seen before.
Luisa Rollenhagen (08:37)
So there’s already one key element employers need to be aware of. What are some compliance challenges that could arise for multinationals in Italy?
Marcela Uribe (08:49)
There are a lot of regulators and they like to audit, they like to audit often. So it’s a little bit about making sure that you’ve got a strong compliance framework so that you’ve got the right level of either policies and practices and trainings that need to be affected on a regular basis. So that should you ever be visited by the labor authorities to do some sort of an inspection, that you’ve got the right types of employment agreements or that your wage practices are correct. Working hours are absolutely fundamental. I would say the other thing maybe to think about would be depending on your industry, the adherence to safety regulations. So these types of things are paramount and you really can be audited unexpectedly. So it’s a really good thing to make sure that you’ve got the right kind of advice and advisors that when you come in you’ve got these right pieces in place to ensure that you’re compliant.
Luisa Rollenhagen (09:47)
You just said that working hours are absolutely fundamental. Could you tell me more about that?
Innocenzo Casanova (09:53)
Usually, as an average, it is 40 hours, then you have different kinds of reductions to be applied. Some are applying, some companies are applying 37, 34. So it is a good mix and this is part of the, so-called second-level agreements every company can establish between the unions and the company representatives, an agreement that says, okay, we’ll give you X amount of extra hours to be at home or take permissions to go and visit, I don’t know, parents with the problems or so. So this varies, and it’s part of the mix of calculations that we need to apply to our system that determines the complexity at the end.
Marcela Uribe (10:35)
But what I think is sort of the last piece missing there on top of what just said is about tracking those hours, because whether it’s 37 or 34 or 39, what you can’t do is if you’re not tracking things properly, you run the risk of having too much overtime. And that’s something that is certainly potentially a problem for any employer.
Innocenzo Casanova (10:57)
That is very specific to Italy. The time and attendance contract, which is company-wise, is sometimes more complex than the payroll one because really, you need to break down any hour of your working hours and decide what is that hour allocated to, what and why, and if you take a permission, two hours, at different level of contribution. So that is the complexity. If you add also for certain types of business, the shift introduced regular shift, 24-hour shift, extra payments if you do one hour more, two hours more up to five hours. So this is determining different levels of payment into the payslips at the end, different levels of taxation, contributions to social security. That’s the real complexity.
Luisa Rollenhagen (11:54)
Innocenzo, you said something about second-level agreements that a company can negotiate with a union. What do you mean by that?
Innocenzo Casanova (12:02)
In Italy, registered, formally registered at the CNEL, which is the National Economy and Labor Agency, there are up to 1,000 different labor collective agreements or bargaining agreements registered, so formally registered.
On top of those collective agreements, that are kind of standardized collective agreement, defining working hours, extra time, and severance in Italy, and this is special to Italy, it’s called a TFR, more or less is one month of your income per year that the employer has to keep for you like a severance to be then given at the end where you’re leaving the company or retirement or so. So it is an amount of money that has to be kept aside for you. And on top of that, there are also the so-called second-level agreements, because the Italian law says that you need to protect the workers, since when it was established in 1977, all the measures were around giving a better life to the workers at work, but also at home with the families and being able to keep the family in good shape and give them welfare and options for having a good life. So in order to have this system under control, every company is establishing a kind of negotiation between the unions and the representatives of the company in order to introduce new benefits or decide whether to introduce a reduction of hours that is beneficial, but everything has to be established only if it is an improvement for the quality of working life. This is the concept, the fundamental principle to be respected.
Luisa Rollenhagen (14:02)
I see, so second-level agreements are sort of “top-ups” to improve employees’ work-life balance?
Innocenzo Casanova (14:08)
Primarily. Yes, but also some other things like benefits and everything that relates to maybe special deductions or improving the quality of the worker’s life and wages of course.
Marcela Uribe (14:23)
Yeah, so it’s almost sort of on top, meaning that you can never reduce any benefit that you have from the national agreement. So this is to say if you’ve got sort of level X, this could be X plus Y that gets negotiated locally and that’s what they consider the second level agreement.
Innocenzo Casanova (14:40)
And to make it even more complex, those agreements usually have a kind of, they are different location by location. Maybe there’s a regional second-level agreement, municipal or regional province agreements or so. There are very variety of those agreements to be applied, not only based on the company level but also between the unions related to a certain business and the geography where those businesses are located. We had recently a lot of discussions with Marcela around this point for some clients whether to apply a regional agreement or not, but it’s up to the company to decide because at the end of the day, you need to comply with the social security agency and the tax income agency. They give you the rules based on your type of business and then it’s up to you if you want to pay more or give better wages to your employee. It’s a better welfare within your company and also you are more attractive.
Marcela Uribe (15:47)
And by the way, you said it was a negotiation, which it absolutely is. It’s almost an ongoing negotiation because these things expire and then the renewal comes with a new negotiation. It’s not as if it’s sort of flat like okay, we have this second level and we’ve had it since 1994. No, no, no. These are renewed and reassessed periodically as well.
Innocenzo Casanova (16:07)
Yeah. Thank you, Marcela. This is an important point that I didn’t mention, but those agreements have an expiration date. Usually, it is every four years.
Luisa Rollenhagen (16:16)
So it’s a way for companies to offer additional benefits to their employees. I’m sure that’s a powerful talent retention strategy as well.
Because of Italy’s employee-friendly culture, I can imagine that the social security contributions are plentiful, perhaps even comparable to France and Germany. What do employers coming from abroad need to be aware of?
Innocenzo Casanova (16:38)
Payslips in Italy have an overall 120 fields to explain how the taxations and contribution are applied to wages and so on. 50% of those fields are dedicated to taxations and contributions to social security. So you can understand the level of complexity around that.
So when you’re coming in Italy and you want to open a payroll in Italy, the first thing you need to understand is who you are. Okay? What is your type of business?
But the type of work will determine the type of taxation and deduction that you have because the idea and the principle will remain the same. We need to protect workers. So if the risk is higher by doing a job outside, there are more risk of accidents or whatever it is. So the social security maybe is higher, to be paid is higher compared to a business which is more safe and done at home or so. So this is the complex. So you need to register yourself based on all the type of business and type of level of workers within the contracts and based on that, the social security agency and the tax agency will give you a code and that’s it for you. Then you can apply the level agreement that covers those type of needs. And the difference between I think other countries, but in Italy is a mandate, the employer is a tax withholding agency.
So we need to take money from the employees upfront in order to pay social security contribution every month. So there is a progression over the year and taxations. So taxation are applied and every year are changing, keep changing because there is every year a financial law that is giving different ratio, different ranges. And so every year there is a change.
Marcela Uribe (18:35)
The Italian government does often issue these new decrees or new laws with not a lot of notice. So I would say that’s another thing for new entries into the market to aware of is that you might have to scramble a little bit to get ready or be in a position to be compliant with some of the new legislation that comes out because it’s oftentimes with not a lot of notice.
Luisa Rollenhagen (19:03)
What is ADP doing to help clients navigate this?
Innocenzo Casanova (19:08)
Compliance is the most important part. Overall, the end-to-end process has to be compliant. And being compliant with the changes in regulations is key. So ADP has a legal watch department that keeps track of any regulation changes that is by law or regional laws, local legislation or national ones. We have this legal watch department set of specialists that are dedicated to understand the relevant changes that happen and the labor legislations every month. And we deliver the, so-called agenda normativa. So regulation agenda with the list of all the relevant changes or new legislation at any level that will happen in the upcoming month. And we deliver this internally and externally, to the client and internally to our, we call them software-based developers because our engines where the rules are coded have to change the rules based on the new regulations.
Luisa Rollenhagen (20:14)
So while I was doing some research on employer obligations in Italy, I came across a certification called the Single Document of Contribution Regularity, also known as DURC. From what I could tell, it’s a really important certification for businesses in Italy. Can you tell me more about this?
Innocenzo Casanova (20:35)
It happened in 2009. It was an unfortunate story, but there was the earthquake in the Abruzzo region and the government gave 14 billion dollars to rebuild. So you can imagine all the construction companies that applied to rebuild the Abruzzo region. So the government decided to introduce this certification in order to give first of all to all the companies the same level of, kind of equalizing them, because at that time, they were kind of paying less the workers.
Luisa Rollenhagen (21:14)
There was a lot of informality then and workers were being paid cash in hand instead of getting official paychecks.
Innocenzo Casanova (21:20)
So in order to avoid all of those things, and also to have transparency in the process, they requested this certificate. That means that you need to be compliant with the, it’s called the unique document of regular contributions. So in order to get this document, this certificate from the social security, you need to be compliant with all the payments. So the employer has to pay all the regular contributions and all the process has to be completed every month on time.
And now because that process has worked starting from the time very, very well, now this certification is required from any type of business and they introduced also another document that is called the DURF for the fiscal check. So social contribution check and fiscal check, at the end, it is a way to determine if a company is a solid company that pays the workers in the right way and pays the contribution on the other side. And in terms of transparency, it is a mandated requirement.
Marcela Uribe (22:27)
So this document is essential. You need to have it if you’re conducting business in Italy. So it started off in the construction industry, but as Inno described, it goes across all industries. And so it will block you from being able to engage in a tender or engage in other types of business. Because it’s effectively, if you want to think about it, almost like a certificate of good standing. This company is, it comes full circle talking about compliance again.
So it’s evidence to say, yes, I pay, I mean I’m in good standing with respect to my employees and my payments to them and from a fiscal perspective. So it really is a broad way of saying, this company is in good standing.
Luisa Rollenhagen (23:08)
I imagine the repercussions are pretty bad if a business fails to receive this certificate, right?
Innocenzo Casanova (23:14)
Penalties and so on and so forth. And also ultimately the business impact, that they cannot apply to tender or the work can be stopped.
Luisa Rollenhagen (23:23)
Of course, it could cost a company millions if they suddenly aren’t allowed to operate.
Another unique thing I came across was the existence of so-called labor consulting firms. What are these?
Marcela Uribe (23:35)
So these are just, as it says, they’re labor consulting firms, but there are reserved activities that only they can do. And this is regulated by law. So specifically certain types of declarations or any kind of interactions with the social security or other governmental agencies, they need to be the ones to do that. So even if somebody comes to a company like ADP for their payroll, there’s that, call it last mile or those portions of these activities that are reserved specifically for them. And I’ve not seen that elsewhere. I’ve seen these types of companies that absolutely exist across the board and they provide additional consulting, but to have these activities reserved solely and exclusively to them is something that I found to be sort of unique to Italy.
Luisa Rollenhagen (24:27)
Oh yeah, I don’t think I’ve heard of something like that either.
So we’ve covered quite a bit of ground regarding legislative issues, but I want to circle back to something Innocenzo said earlier when he was talking about second-level agreements. He said that these agreements can make a company more attractive to potential employees, and this is no minor thing.
Italy is currently experiencing a shortage of skilled labor, and attracting and keeping the right talent is key. But another strategy that employers are using right now to fill the gap is to upskill the workforce they already have. Companies are investing in extensive skills development programs and offering training opportunities.
Remember Andrea, who we briefly met at the beginning of the episode? He works as a copywriter at an advertising agency but realized that the company was spending a lot of money outsourcing voiceover speakers for their commercials. Andrea had previously done some voiceover work for the agency and saw an opportunity.
Andrea (25:32)
I work as a copywriter, so I basically write texts for the advertising. But I had the opportunity six years ago to start doing voiceovers and the TV commercials. And yes, I had this opportunity and I liked it very much.
Luisa Rollenhagen (25:47)
Andrea decided that he wanted to gain formal skills in this area, and approached his employer about potential training opportunities.
Andrea (25:55)
I approached my employer. I asked the human resource manager to have an interview with her. And yes, I wanted to ask her to pay for the course and gave me the opportunity to improve my skills because I always did it as a non-professional. So I wanted to study and to improve my skills. And since I already studied two years ago and paid by myself, I asked them to pay for this course because when I work for them as a speaker in the agency, they save a lot of money.
Two or three days after, she came to me and she said that it was okay, they were speaking among them, among the managers about this opportunity, and she said, yes, we think that that’s a good reward for you, for your work, for what you already did for us. And we think that this could be a good opportunity for also for us. I mean, if you become better, we have a speaker in-house to do the job.
Luisa Rollenhagen (26:53)
The formal course gave Andrea the chance to gain some real professional expertise.
Andrea (26:58)
We basically train on different subjects of dubbing, for example, documentaries or poetry or audiobooks, advertising, of course, movies, TV series. I’m very happy with this course. To be honest. 80% of the work, you do it at home on your own. You have to read a lot and train a lot on reading. But yes, I’m seeing, I would say a lot of results because I am training a lot at home and doing some voiceovers on advertising. I have a microphone at home so I can train also at a microphone. And yes, very happy with it.
Before the course, I used to speak for these commercials that go to the clients for internal approval before going on TV. These normally need the voice of a professional speaker, but this is a cost for the agency. So since I was good enough to do that, the agency asked me to do that. And I did this for a lot of years, like four or five years now. But these commercials didn’t go on TV. And now this changed because two weeks ago, this is a major improvement. After the course, I mean, the course started, my first TV commercials went on TV for an Italian client. I mean, that was a major, I don’t know how to say, but I was very, very proud for it because that went on TV. My mom and my family and friends could hear me on TV.
Luisa Rollenhagen (28:27)
From an employer’s point of view, the investment also paid off.
Andrea (28:30)
My employers, they were happy with my improvements. It happened two or three days ago that I was dubbing a commercial for a client. And when I sent this, I got an email back, like 15 minutes after with a lot of compliments. So yes, I think that they see that I am becoming better and better.
Luisa Rollenhagen (28:52)
I was curious to learn more about how upskilling is shaping Italy’s labor force, so I went back to Marcela and Innocenzo to find out more.
Marcela Uribe (29:01)
The trend is absolutely to look, to try to upskill the existing workforce because there is a bit of a shortage for certain types of workers in Italy at the moment. And so there are always a certain level of mandatory trainings that employers need to give to their employees to keep them compliant with, especially if it’s particular to their industry and certainly with respect to their safety. But on top of that, it really feels as though there’s been this shift towards trying to upskill employees or the workforce to make them more employable. So one of the things that certainly that we see that’s sort of I guess within quotations a bit easier is English language training, for example. That’s something that we see a lot of because it makes people that much more marketable across different industries or if they work for a multinational company for example. But labor regulations in general will require employees also to keep detailed records, always back to the records. They like their paperwork with respect to the training that they’re doing. But that seems to be the trend is to see, how do we try to keep the workforce in Italy as opposed to trying to, the knowledge drain, having people leave. So what can we do? We upskill people who are here.
Because otherwise, that’s the risk, right? So if we don’t invest and we don’t train the workforce, especially maybe the younger generations will go elsewhere to find a different kind of work.
Luisa Rollenhagen (30:32)
Absolutely. And offering training opportunities is a way for employers to stand out among the competition.
Marcela Uribe (30:39)
It’s a great thing for employers to really think about, because this is what would set them apart, and for employers to take a proactive approach. So obviously there are some standard trainings that are mandatory, but for employers to do this on top is exactly the type of thing that these types of workers, the one that you’re talking about, would be keen to have and that would be able to retain talent because whether it’s retaining them within your company or we were saying a second ago on the territory here in Italy, but also just to keep really solid great talent within your company.
Luisa Rollenhagen (31:12)
For sure. We’re going to start wrapping up, but speaking of retaining talent: Are there any other employee requests or benefits that are popping up more frequently during contract negotiations?
Marcela Uribe (31:34)
One of the things that has become a very hot topic here is the flexibility around work. So when and where you work. So whether you can work from home and if so, how many days are you in the office? How many days are you at home? And what I absolutely love is here in Italy they use an English term. They don’t describe it in Italian, they call it smart working. So if you work from home, it’s not called work from home, it’s called smart working, which I find to be brilliant because the thought behind it is exactly that. It’s meant to say, I’m going to work smarter today because that means that if I start at 7:00 AM as opposed to 9:00 AM and I finish a little early, or I finish a little late because I’m dropping my kids off or I have to go to the dentist or whatever it is I might have to do, I’m using my time wisely.
Luisa Rollenhagen (32:14)
Yes! I petition to officially rebrand remote working as smart working. I absolutely agree that for many people, it allows them to work smarter.
Marcela Uribe (32:23)
I think the other thing about the work culture that I would comment on is that people do really work hard. So they definitely want their flexibility, but they work fairly long hours. And maybe that’s why there is such a demand for the smart working because that way they can manage their agendas a little bit better, but really strong work ethic, really, really high level of professionalism, which is a joy to work with.
Innocenzo Casanova (32:48)
And if I can add Marcela, smart working is smart also because it is location-independent. Because if you compare the smart working compared to the traditional remote working that requires the kind of contract that says, okay, your home location is this one, very precise, that can be your home location. But the smart working can be everywhere within the Italian boundaries because we cannot do it for other reasons in other countries, but within Italian boundaries. So you can imagine for someone who had to pay rent fee in Italy, Milan very expensive, can move to a location to have a limited expenditures for that. It’s really a benefit on top. So that’s why as Marcela said, a lot of negotiation around that happened and it was part of the second-level agreement negotiations.
Luisa Rollenhagen (33:47)
Absolutely! It has such an impact on your quality and cost of life, so it’s really cool to hear that this trend is really gaining ground in Italy.
I won’t keep you any longer. Thank you so much for taking the time to share your expertise with us! I learned a lot about payroll in Italy today, and really admire the steps that many companies are taking to upskill their workforce and combat the skilled labor shortage.
I hope you got a bit of a deeper insight into how payroll in Italy works today. If this episode has piqued your interest or your company is considering expanding into Italy and you want to learn more about payroll there, please go to the ADP Italy website it.adp.com.
And don’t forget to subscribe to learn more about payroll around the world with each new episode.
You’ve been listening to
ADP Payroll around the World
Produced by ADP and Storythings
Episode Credits
- Executive Producers for ADP: Nicola Smith and Kate Allen
- Executive Producer for Storythings: Matt Locke
- Recorded, edited, mixed and mastered by: Chris Mitchell
- Scripted and hosted by: Luisa Rollenhagen
- Guest interview recorded by: Alessio Perrone
- Project Manager: Aimee Perrinjaquet
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