August News
- August 26, 2020
- Reading time: 10 min
This document outlines the main changes in labor law introduced by the so-called August Decree (Decree-Law No. 104/2020), which entered into force on August 15, 2020, as the latest measure adopted by the Government to address the Covid-19 emergency.
In examining the new regulations on employment retention measures during ongoing employment, the analysis begins by reviewing some of the provisions introduced by the Cura Italia Decree and the Relaunch Decreeto provide an overview of the emergency measures supporting businesses and workers (see also the summary table).
In addition to the main topic of social safety nets, other changes introduced by the August Decree will be discussed, such as: the exemption from paying social security contributions for companies that do not apply for temporary layoff benefits, contribution relief for employment, and regulations on fixed-term contracts, the extension of the prohibition on layoffs, further installment plans for suspended payments, and the doubling of the limit on corporate welfare benefits for 2020.
Ordinary unemployment benefits, ordinary unemployment allowance, and exceptional unemployment benefits
D. Cura Italia → Articles 19 through 22-quinquies, Decree Law No. 18/2020, converted into Law No. 27/2020
This decree introduced three types of wage subsidies to address the same extraordinary event, lasting 9 weeks: CIGO, the ordinary allowance, and the exceptional fund.
Questions regarding ordinary layoff benefits and ordinary unemployment benefits, submitted to INPS, required prior notification, consultation, and, where applicable, joint review with the trade unions that are comparatively more representative at the national level.
Upon the decree’s conversion into law, individuals are granted the opportunity to apply for the standard supplementary benefit for an additional period not exceeding three months, to employers with production units located in the so-called red zone, specifically:
with production facilities located in the municipalities identified in Annex 1 of the Prime Ministerial Decree of March 1, 2020;
AND for those
that do not have a registered office or a production or operational facility in the aforementioned municipalities, limited to current employees who reside or are domiciled in those municipalities.
The application for special fund, submitted to the Regions, on the other hand, required prior agreement with the most representative trade unions at the national level for employers with more than five employees.
In the case of companies with multiple locations (companies with facilities in at least five regions or autonomous provinces), the application followed a simplified procedure involving its submission to the Ministry of Labor and Social Policies.
Upon the decree’s conversion into law, the option is granted—as provided for in the case of ordinary layoff benefits and ordinary unemployment benefits—to apply for the extension of benefits for an additional period not exceeding three months, to employers with facilities or workers located in red zones.
Similarly, employers with production facilities—or, in any case, for their employees who are resident or domiciled—in the regions of Lombardy, Veneto, and Emilia-Romagna (the so-called “yellow zone”) are eligible for exceptional wage supplementation benefits for an additional period not exceeding four weeks, which may be authorized by the same granting order.
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