“Under 36” Social Security Contribution Exemption

Following the European Commission’s approval on September 16, INPS has released instructions on how to take advantage of the “Under 36” contribution exemption, for the hiring and conversion to permanent contracts, by December 31, 2021, of young people who have not reached the age of 36 as of the date of hire. This exemption is provided for by the 2021 Budget Law No. 178/2020, with the aim of promoting stable youth employment.

This exemption applies to all private employers, including those in the agricultural sector, regardless of whether or not they qualify as business owners. The incentive does not apply to companies in the financial sector (Ateco codes 64, 65, and 66), as they fall under Section “K,” which is expressly excluded from this exemption; The exemption does not apply to the public administration. Please note that the measure does not apply to apprenticeship agreements, domestic service contracts, or hiring under intermittent employment contracts.

Coordination with other incentives

This exemption, which is governed by the structural youth exemption referred to in Article 1, paragraphs 100 through 108, 113, and 114 of the 2018 Budget Law, “cannot be combined with other exemptions or reductions in financing rates provided for by current legislation, limited to the period during which such exemptions or reductions apply.”

Therefore, this measure cannot be combined with, for example:

• The incentive for hiring women who have been without regular paid employment for at least 24 months, or who have been unemployed for at least 6 months and belong to specific economic sectors or professions as defined in Article 4, paragraphs 8 through 11, of Law No. 92 of 2012;

• The hiring incentive for so-called “disadvantaged” women, as provided for in the 2021 Budget Law;

• Social Security Contribution Relief for the South, for the same workers.

Amount of the incentive

The incentive consists of a 100% exemption from the payment of total social security contributions payable by employers, up to a maximum amount of €6,000 per year, for a period of thirty-six months. Private employers who hire employees at a location or production unit situated in the following regions are eligible for a 48-month exemption: Abruzzo, Molise, Campania, Basilicata, Sicily, Apulia, Calabria, and Sardinia.

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