Italy: Temporary agency work and collective bargaining in the EU

  • Observatory: EurWORK
  • Topic:
  • Published on: 18 Diciembre 2008


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Temporary agency work was introduced in Italy by Law 196 of 1997, whose section covering this type of employment was repealed in 2003 by Legislative Decree 276/03, which changed the denomination from ‘temporary agency work’ to ‘staff leasing’ but made only minor changes to the previous law.Ten years after the introduction of temporary agency work, the agencies have risen in number from the 33 firms operating in 1998 to 81 in 2007 ( 145%), these latter being divided into 2692 branch offices, 61% of them in North Italy. Simultaneously, temporary labour agencies have grown into a full-fledged sector of activity with a total of 9500 employees (directly employed at branches), with annual revenues of EUR 6.5 billion in 2007.

Section 1. Definitions

1) In your country, is there a statutory definition of:

a) temporary agency work?b) agency worker?c) user enterprise?

There is no legal definition of temporary agency work (since 2003 ‘staff leasing’), or temporary agency, or user firm.

2) Is there a collectively agreed definition of:

a) temporary agency work?b) agency worker?c) user enterprise?

As in the previous answer, there is no definition established by collective bargaining.

In general, the labour leasing agency is the employer on which the worker assigned to the user firm formally depends. The user firm, in its turn, directs and controls performance of the work assigned.

3) In your country, would you describe TAW as a sector in its own right?

Temporary agencies have burgeoned over the past ten years, with an average annual rate of growth of 20%. This increase in business volume has led to recognition of this branch by all the actors concerned, and particularly by employers, as a sector in itself, even though the agencies (whose employees are covered by the nation-wide collective agreement for the commerce sector) furnish services to businesses as do other firms in the tertiary sector.

Section 2. Regulatory framework

1) Have there been any changes in the law concerning TAW since 2004?

a) Yes b) No

Since 2004 the main change has been introduced by article 1, sub-section 46, of Law 247/2007, which abolished permanent staff leasing. This arrangement had been introduced by Legislative Decree 276/2003. Consequently, since 1 January 2008, the date when Law 247/2007 came into force, it has no longer been possible for agencies to stipulate indefinite staff-leasing contracts, but only fixed-term ones.

2) How is TAW regulated in your country?

a) Is there a legal framework specifically for TAW; and/or is it covered by general labour law (including case law/ jurisprudence)?

Temporary agency labour (the exact term is ‘leased labour’) is regulated by articles 20-28 and 85 of Legislative Decree 276/03, which besides regulating the agencies, has introduced significant changes in the labour market more generally.

The law states the general circumstances in which the use of temporary agency labour is permitted.

b) What is the role, if any, of collective labour agreements and self-regulation?

Collective bargaining, at national level in particular, plays a central role in regulating temporary agency work. In fact, the national industry-wide agreements (contratti collettivi nazionali di lavoro, CCNLs) for the various productive sectors set quantitative limits on the use of labour-leasing contracts (although always with reference to exemptions envisaged by the general regulations on fixed-term contracts), besides specifying in detail the reasons (termed ‘causal’) for their use, bearing in mind the specificity of the sector to which the CCNL applies.

Moreover, the CCNL for leased workers, and specifically for those workers as described below (at question 3), states the terms of expiry (duration of contracts, possibility of extension, limits on the sequencing of contracts).

3) What is regulated in these provisions? In particular, does it cover:

a) use of agency work (e.g. length of assignment, sectoral bans, permitted reasons of use, number of agency workers per company, other)

To date, collective bargaining, or the CCNL for leased workers (on the changes recently introduced see question 3), have not set limits on the duration of leasing contracts, and even less so on the sequencing of contracts (the same agency can stipulate, even uninterruptedly, several contracts with the same worker). The only limit set by the CCNL for leased workers concerns extensions, so that the initial assignment can be extended for a maximum of four times and for an overall duration of no more than 24 months (the initial assignment and subsequent extensions form a single work contract).

There are no sectoral prohibitions on the use of labour agencies. The law, in fact, does not set limits or conditions on the use of leased labour in particular sectors like construction and agriculture.The law stipulates the general circumstances in which the use of temporary labour is permitted: ‘[...] reasons of a technical, productive, organizational or substitutive nature referable to the ordinary activity of the user firm [...]’ (Decree Law 276/03, art. 20, sub-section 4). It is also permitted by law to use leasing contracts to replace absent workers (for example on maternity leave or accident leave). It is instead forbidden (again by law) to substitute workers on strike, in firms which have made collective lay-offs in the previous 12 months, in production units where workers have been placed on the wages guarantee fund (for workers employed in the same jobs as cited by the leasing contract), and in firms which do not comply with regulations on workplace health and safety.

Finally the sectoral CCNLs set quantitative limits on the use of leasing contracts (a percentage in comparison with the firm’s permanent workforce): e.g. 8% in the CCNL for metalworkers, 15% in the CCNL for transport workers, 15% in the CCNL for commercial workers, etc. Excluded from these quantitative limitations are the following situations envisaged by the law: start-up of new businesses (for an initial period established by the CCNL); substitutions (as above); seasonal work; hiring of workers aged over 55.

b) the form of the contract (e.g.project, fixed-term, special contract, open ended, etc.)

The law regulates the form of the contract between the user firm and the labour agency. This contract must contain, lest it be annulled, the following elements:

  • details of the authorization issued to the leasing agency;
  • the number of workers to be leased;
  • the reasons for resorting to leased labour. The reasons cited must not be generic but instead refer specifically to the reason for the use of leased workers;
  • indication of the risks to the worker’s health and the safety measures adopted;
  • start date and duration of the contract (the leasing contract is fixed-term and must always contain a start and finish date, extendable within the limits stated above);
  • the work tasks assigned to the agency workers and their job classifications;
  • workplace, working hours, pay, and legal conditions of the leased workers;
  • assumption of the obligation by the agency to pay the worker’s wage, as well as to pay social security contributions;
  • assumption by the user firm of the obligation to refund the wage and social security costs sustained by the agency;
  • assumption by the user firm of the obligation to inform the agency of the pay received by comparable workers;
  • assumption by the user of the obligation to pay the worker’s wages, as well as social security contributions in case of omission by the agency;
  • the costs relating to workplace safety.

The contract may not contain any clause which restricts the user firm from hiring the worker on conclusion of the leasing contract.

c) social security and social benefits

The law states that the agency must pay social security contributions and make insurance payments, respectively to the National Social Security Institute (Istituto Nazionale della Previdenza Sociale, INPS) and the National Workplace Insurance Institute (Istituto Nazionale Assicurativo per gli Infortuni sul Lavoro, INAIL). The social rights of the leased worker in administration are the following:

  • sickness: the right to maintenance of the job for 180 days (extendable for a further 120 days upon application by the worker). The benefit is 100% of pay for the first 3 days, 75% from the 4th to the 20th day, 100% from the 21st to the 180th. This sickness allowance ceases as soon as the leasing contract expires.
  • Accident: 100% payment of the wage until expiry of the contract. After that date, if the contract is not renewed, the worker is entitled only to the allowance paid by INAIL (60% of the wage) until recovery.
  • Family allowance during the work assignment.
  • Unemployment benefit (under the same conditions as apply to dependent workers).
  • Maternity (under the same conditions as apply to dependent workers).

d) conditions to open a TAW agency (e.g. license or authorisation schemes, supervision by public authorities, financial requirements, or others - please specify)

Authorized agencies must enrol on a special national register upon fulfilment of a series of legal criteria (among which, legal office in Italy or in another member-state of the EU). Authorization to carry out the activity, even solely on a regional basis, is issued by the state (by the Ministry of the Labour).

e) business activities/services delivered by TW agencies (e.g. prohibition to provide other services than TAW)?

The law allows agencies to furnish the following services:

  • labour leasing;
  • staff recruitment and hiring;
  • professional outplacement, also through training courses.

f) third-national companies or temporary agency workers (e.g. activities of foreign agencies)?

It is mainly the law that regulates the activity of labour agencies. Foreign agencies allowed to operate in Italy are only those with legal offices in Italy or in another member-state of the EU.

4) Do any regulations (by law and/or collective bargaining in the TAW sector) specify equal treatment rights for agency workers with permanent workers in the user enterprise concerning:

a) pay

Both the law and bargaining establish that leased workers are entitled during their assignments to receive pay ‘not inferior’ to that of the user firm’s employees with the corresponding job grade (tasks performed remaining equal) according to the collective agreement, both national and company-level, applied to the user firm.

This entails complete parity of economic treatment between the user firm’s employees and the workers leased by the agency.

b) training

As regards training, the labour-leasing sector has its own self-financed system, separate from that of the user firms, whose training schemes are restricted to their own employees.

First the law and then collective bargaining have instituted a bilateral (i.e. co-managed by the employers’ associations and trade unions) fund entitled the National Training Fund for Temporary Workers (Fondo Nazionale per la Formazione per i Lavoratori Temporanei, FORM.TEMP). This fund is financed directly by the agencies, which must make contributions equal to 4% of the gross wages paid to leased workers during assignments.

Form. Temp organizes certified and free training schemes intended to promote the updating and retraining of leased workers.

c) other terms or conditions of employment?

Besides parity of economic treatment, the law also establishes parity of legal treatment between the employees of user firms and leased workers. This entails complete equality of entitlements (even if not expressly stated either by the law or bargaining) as regards, for example, working hours, job classifications, overtime and night-time work, holidays, leave, etc.

Parity of treatment is expressly envisaged by the law, and also confirmed by collective bargaining (the CCNL for leased workers), as regards two important matters:

  • Workplace health and safety. The user firm must comply with all safety and protection standards set by the law in regard to its employees and also to leased workers.
  • Trade-union rights. All agency workers are entitled to the trade-union rights stipulated by law. In fact, throughout the assignment, the leased worker has the right to engage in trade-union activity (enrol with the trade union, elect representatives, attend assemblies during paid working time), as well as to attend the assemblies of the dependent personnel of the user firms.

Finally, only collective bargaining expressly establishes equality of treatment in regard to the right to study.

5) Do TAW workers have the right to information, consultation and representation?

The information and consultation rights set out in Legislative Decree no. 25 of 2007 (which transposes European Directive 2002/14/EC) encompass all subordinate workers and therefore also cover leased workers.

Legislative Decree no. 25 of 2007 grants information and consultation rights to company plant-level union structures (rappresentanze sindacali aziendali, RSAs) or the (user firms’) unitary workplace union structures (rappresentanze sindacali unitarie, RSUs), as well as to the territorial trade unions, on important issues concerning employment, the organization of work and employment contracts (e.g. the stabilization of workers on fixed-term contracts).

The law on leased labour (Legislative Decree 276/03) establishes that the user firm must communicate to the RSAs or the RSUs, as well as to the territorial trade-union organizations, the number and the reasons for leased labour contracts and their duration.

Moreover, the CCNL for leased workers stipulates that supplier agencies must inform the trade unions signatory to the agreement whenever at least 30 workers are assigned (both to the same user firm and different ones).

Finally, as regards rights to representation, the CCNL for leased workers allows them to elect their own delegates within the user firm. However, this right only exists on paper, because the direct election of representatives by leased workers has been negligible from the quantitative point of view, being restricted to a few isolated cases.

6) Is there a control/enforcement mechanism regarding any TAW regulation?

If yes,

a) is there a special labour inspectorate or a bi-partite body governing TAW?

There is no specific inspectorate for leased labour, so that it is the labour tribunal which decides on breaches of the law.

b) are there any sanctions/penalties for not respecting the regulations (whether stemming from law and/or collective agreements)?

The leasing contract is void when it is not in written form or when it has the ‘specific purpose of eluding mandatory provisions of the law or the collective agreement’. Consequently, a leased worker is considered in every effect a dependent of the user firm.

A leasing contract is instead irregular if it has been stipulated by an unauthorized agency in circumstances (for reasons) contrary to those envisaged by the law; if it is in breach of the quantitative limits set by collective bargaining; and if it lacks the mandatory elements (e.g. start date and duration of the contract, risks to the worker’s health, and the preventive measures adopted). Consequently, the worker can lodge appeal for an employment relationship to be established directly with the user firm.

The legal sanctions in the case of irregular or nil supply, which apply both to the agency and to the user firm, range from a minimum of EUR 20 to a maximum of EUR 50 for each worker involved and each day of leasing.

The legislation also envisages an administrative sanction, to be paid both by the leasing agency and the user firm, ranging from a minimum of EUR 250 to a maximum of EUR 1250, in cases of fraudulent behaviour.

7) Are there any procedures governing use of TAW and strike breaking?

In particular, can workers on strike be replaced by agency workers?

The law expressly prohibits the substitution of workers on strike with leased workers.

The right to strike enshrined in the law, as are the rules regulating the announcement of strikes, is identical for both permanent employees and temporary ones (also on lease).

Section 3. Social dialogue and collective bargaining

1) Is there any employers’ association(s) for TAW firms in your country?

The National Association of Work Agency (Associazione Nazionale delle Agenzie per il Lavoro, ASSOLAVORO) is the employers’ association. It comprises 62 labour-leasing firms out of a total of 81 authorized agencies operating in Italy. Assolavoro accounts for 98% of the overall business volume of labour leasing. The association belongs to the General Confederation of Italian Industry (Confederazione Generale dell’Industria Italiana, CONFINDUSTRIA).

2) Is there any union(s) specifically for agency workers?

If no, have any unions or confederations targeted the recruitment of agency workers? launched any campaigns around agency workers’ rights?

At the end of the 1990s, the trade-union confederations, the General Confederation of Italian Workers (Confederazione Generale Italiana del Lavoro, CGIL), the Confederazione Italiana Sindacati Lavoratori (Italian Confederation of Workers’ Unions, CISL) and the Unione Italiana del Lavoro (Union of Italian Workers, UIL), created internal structures to protect and represent atypical workers (among them also temporary agency workers). These three structures of the Cgil, Cisl and Uil, whose memberships consist of atypical workers regardless of their sector of employment (unlike all the other trade-union categories), are respectively New Identity of Work (Nuove Identità di Lavoro, NIDIL-CGIL), Worker Association of Atypical and Temporary Workers (Associazione Lavoratori Atipici e Interinali, ALAI-CISL), and Coordination for the Employment (Coordinamento per l’Occupazione, CPO-UIL).

Nidil has 32,799 members (in 2007), Alai has 27,698 (in 2007), whilst Cpo does not report the figure.

3) Collective bargaining levels

Is TAW governed by collective bargaining at:

a) intersectoral/ national level?

The CCNL for leased workers (for details see answer 4 in this section) is of great importance in the regulation of this type of contract.

b) the sectoral level for TAW?

The sectoral CCNLs are equally important. In fact, these (as already said in section 2, answer 2, point b) set the quantitative limits on the use of leasing contracts in the various sectors, besides specifying in detail the circumstances (termed ‘causal’) in which they can be utilized, with particular regard to production processes in the sector covered by the CCNL.

c) company (ie. temporary agency firm) level?

There is no collective bargaining within labour agencies as far as leased workers are concerned. Instead, the company-level agreements of medium- and, especially, large-sized great firms contain sections dealing with leased labour. These provisions are concerned in particular with the allocation of company performance-related bonuses and agreements on job stabilization which plan the hiring on open-ended contracts of leased workers.

4) Collective bargaining outcomes

Please provide examples and details of any recent/ significant collective agreements governing TAW at the levels referred to in question 3.

On 23 July 2008 an agreement was signed between Assolavoro and Nidil Cgil, Alai Cisl and Cpo Uil on renewal of the CCNL for leased workers. The main innovations introduced were the following:

  • Information rights. Whenever at least 20 contracts (and no more than 30) are stipulated involving as many workers, agencies are obliged to inform the territorial trade unions.
  • Trial period. This is fixed as 1 day every 15 calendar days, up to a maximum of 13 days for assignments longer than 6 months (it was previously less).
  • Notice. This is introduced for the first time in the case of resignations by workers, and it is calculated from the 16th day of assignment as 1 day for every 15 days of assignment (up to a maximum of 7, 10 and 20 days according to the worker’s job classification).
  • Extensions. These are increased to 6 for a maximum of 36 months, including the initial period (previously 4 extensions were possible for a maximum of 24 months, with exclusion of the initial contract - section 2, question 3, point a).
  • Stabilization. The agreement regulates the stabilization process (previously not covered by any legislative provision) for the first time. It provides that agencies must hire on open-ended contracts leased workers assigned for 36 months to the same user firm (increased to 42 months if there have been at most 2 extensions in the first 24 months) or after 42 months of assignment to different user firms, provided that there has been no interruption equal to or longer than 12 continuous months between one assignment and the next due to refusal by the worker of a job offer.
  • If a worker is hired on an open-ended contract, the agency is bound to keep him/her on as an employee for at least 12 months, after which, if the agency cannot maintain the employee further because of a lack of work, s/he will receive for 6 months (7 for workers aged over 50) an ‘availability allowance’ of EUR 700 a month, of which 50% is paid by the agency and the remaining 50% by the Bilateral body for the income support and training of leased workers on open-ended contracts (Ente Bilaterale per il Sostegno al Reddito e la Formazione dei Lavoratori in Somministrazione a Tempo Indeterminato, EBIREF), on conclusion of which the employment relationship is dissolved (in the absence of work opportunities).
  • Maternity. Female leased workers who do not fulfil the legal requirements for the maternity allowance paid by the INPS receive a lump-sum payment of EUR 1400 from the National Bilateral Temporary Labour Body (Ente Bilaterale Nazionale per il Lavoro Temporaneo, EBITEMP).
  • Health and safety. The division of obligations between leasing agency and user firm is strengthened. The former must instruct the worker on the risks (in general) of the sector to which s/he has been assigned whilst the latter must provide training (during the first 2 hours of work) on the specific risks connected with the job.
  • Supplementary social security. A sectoral fund has been created for supplementary social security. The fund will be financed by contributions from the worker, the agency, and the bilateral bodies.
  • Benefits. The agreement increases the benefits paid by EBITEMP regarding:
    • accidents, with the period of coverage extended to 180 days from the end of the assignment with a daily allowance of EUR 35 (previously, if the injury persisted beyond expiry of the contract, the EBITEMP allowance lasted only for a maximum of 90 days);
    • healthcare, with 100% reimbursement of healthcare fees (previously 60%);
    • income support, with a one-off payment of EUR 700 to workers unemployed for 45 days and who have worked for at least 6 months in the past 12.

5) Are there any examples of sector- or company-level collective agreements in other sectors that restrict, permit or otherwise regulate the use of TAW within their domain?

The sectoral CCNL which more than others has recently regulated leased work within its own sector is the metalworkers’ agreement, which was renewed on 20 January 2008. It sets a 44-month limit (also non-continuous) on the possibility for the same firm to stipulate fixed-term contracts for both temporary and leased workers. Beyond this time-limit, firms which have used these types of workers must stipulate open-ended contracts with them.

6) Please provide any data concerning:

a) trade union density for agency workers

Comparison of the figure provided by Assolavoro on the number of leased workers in Italy in 2007, equal to 594,744 persons, with the figures on their memberships declared in the same year by Nidil Cgil and Alai Cisl (on which see section 3, question 2) – bearing in mind that, according to the trade unions for atypical workers, agency workers represent around 30% of their memberships (the remainder are freelancers, self-employed workers, etc.) – shows that the degree of representativeness is rather low: 1.65% for Nidil and 1.40% for Alai.

b) the coverage of collective bargaining within the sector.

Because, according to the law, national-level collective bargaining encompasses all productive sectors, it is applied by all firms, with a coverage that comes close to 100% (excluded from this calculation are the irregular firms that elude all legal and contractual obligations).

Company-level collective bargaining concerns around 30% of Italian firms (data from the National Council for Economic Affairs and Labour, Consiglio Nazionale dell’Economia e del Lavoro, CNEL). This means that performance-related bonuses (one of the main issues on the bargaining agenda at company level) are not paid, as instead foreseen the law, to a significant proportion of leased workers.

Section 4. Employment and working conditions of TA workers

1) Please provide the most recent data (averages) on TAW employment

a) longevity of TAW employment, i.e. how long workers remain employed

- in the sector?

- with a particular agency?

b) duration of TAW placements, i.e. i.e. the length of assignment in a user company.

In 2007, a total of 1,263,697 leased-labour assignments were undertaken, and they involved 594,744 workers (equivalent to 222,000 full-time workers, or 1.4% of total full-time employment). Each worker undertook (on average) 2.12 assignments a year. The average duration, again in 2007, of an assignment was 44.6 days, whilst the turnover was equal to 4.17 (or rather the sum of assumptions and cessations effected in the year for each worker).

The average durations of assignments (in 2007) varies among sectors: 29.6 days in commerce, 54.4 days in industry, 78.6 days in the public services.

2) Please provide any evidence from official, academic and social partner sources concerning:

a) the reasons for user companies’ usage of TAW, including any differences by sector, occupation, firm size etc.b) reasons for workers participation in the sector and levels of satisfaction, including any differences by age, sex, education etc.

There are no up-to-date statistics on these aspects. In 2003, according to the employers’ associations of the agencies, 78% of assignments were justified by extraordinary production peaks (due to new orders, particular periods of the year), 16% to substitute absent workers (maternity, etc.), 6% for skills not foreseen for routine production and not present in the firm’s workforce.

The degree of job satisfaction among leased workers is not recorded statistically (not even on a sample). But according to the trade unions, it is substantially low, in that it is tied to prospects for job stabilization (highly unpredictable) at the user firm. Moreover, direct hirings by user firms involve only a proportion of leased workers: 25% after one year of work, 31.9% after two years, 40.7% after three years.

3) In practice, which rules and procedures may apply to temporary-agency workers in contrast to other workers in the user company?

In reality, the law and collective bargaining regulate leased labour very strictly. The legislative framework prevents agencies from evading their obligations in terms of the pay and rights of leased workers, with the exception of company-level bargaining (e.g. on productivity bonuses, which are often not paid to these workers).

The critical issue is not so much the legislation in place as the effectiveness and extent of controls exerted, also by the trade unions, especially in medium-to-small enterprises, to ensure compliance with the law.

Section 5. The extent and composition of TAW.

1) For 2004 and 2007, please state

a) the number of agency workers b) total reventues of the TAW sector

In 2004 leased workers numbered 400,347; by 2007 the amount had risen to 594,744 ( 48%).

Comparisons on earnings can be made with respect to 2006. In 2007, the revenues of the agencies amounted to EUR 6288 billion, with a 17% increase on 2006, when the revenues were equal to 0.38% of GDP (2006).

2) What proportion of the TAW workforce is currently

a) male/ female?b) full/part time?c) young (<c. 25) or older (>c. 50) workers?

In 2007, there were 252,647 (42.48%) female leased workers, and 342,097 (5752%) males.

There is no information on the proportion between full-time and part-time contracts.

Again in 2007, leased workers aged under 24 numbered 156,758 (27.3% of the total), whilst those aged over 50 years were 24,450 (4.3% of the total).

3) Has there been any changes to the TAW sector in terms of

a) concentration, i.e. proportion of employees or turnover accounted for by the largest firms?b) internationalisation, i.e. number/significance of multinational TAW firms?

In recent years, the leased-labour sector has recorded considerable growth in terms of the workers concerned, authorized agencies (also foreign multinationals), branches operating in the country, number of employees at the branches themselves, business volume by the industry.

4) What is your evaluation of the availability and quality of statistical data concerning TAW in your country?

The sources used (for both sections 4 and 5) are those cited by the Study Centre Observatory of Temporary Work (Osservatorio Centro Studi per il Lavoro Temporaneo), created by FORMATEMP and EBITEMP (see above) and which processes data furnished by the INAIL and INPS. These are sufficiently reliable sources and data. The Observatory also publishes statistical surveys specific to the sector with a high degree of competence and consequently a good level of reliability.

Commentary by the NC

Between May and July 2008, the social partners reached and signed an agreement on renewal of the CCNL for leased workers. This an important agreement which partly revises, and extends through bargaining, the protection of this category of workers.

Through their association, the labour agencies have pledged to guarantee a form of stabilization for workers in an atypical sector like labour leasing. Their aim is to combine flexibility and safety, simultaneously ensuring competitiveness for enterprises and a certain degree of security for workers.

For their part, the trade unions are worried about the predominance of low profiles in leased-labour assignments and about the real reasons for using this type of labour (tied to routine and predictable productive needs). They have thus sought to extend protections in order to guarantee greater contractual stability.

Livio Muratore, Fondazione Seveso

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