Italy: Latest developments in working life Q3 2019

The establishment of a new coalition government, a joint platform from metalworker unions for the renewal of the industry-wide agreement, an agreement on how to measure the representativeness of social partners, and the gap between the south and centre-north are the main topics of interest in this article. This country update reports on the latest developments in working life in Italy in the third quarter of 2019.

Political crisis leads to new coalition government

In August 2019, coalition partner the League instigated a political crisis that aimed to break the many deadlocks and vetoes that the party felt were hindering the government’s actions. While the League demanded new elections, the crisis was solved when the Five State Movement (M5S) and the Democratic Party formed a new coalition government. The new government took office on 5 September, with Giuseppe Conte maintaining his position as the prime minister.

The new government immediately faced two significant challenges: the preparation of the budget law and the departure of Matteo Renzi from the Democratic Party. Renzi, a former prime minister and Democratic Party secretary, left to found a new party (Italia Viva) and was joined by a number of other former Democratic Party MPs.

This latter development sparked some tension within the newly formed coalition and made it difficult for the government to define its key policy initiatives. Among the most controversial measures under debate were the selective increase in VAT (which was abandoned), the termination or re-arrangement of the temporary anticipation of retirement that was introduced in early 2019 (which has remained untouched so far) and the reduction of taxation on labour (which is still under discussion).

Besides the most pressing issue of the budget law, other important initiatives in the field of labour relations mentioned in the government programme were the introduction of a legal minimum wage (which is expected to be set according to collectively agreed wage rates) and the legal regulation of the representativeness of social partners. Prime Minister Conte also committed to involving social partners in all relevant policy initiatives, although the debate has centred around relations between the coalition partners so far.

• Italian Government – Presidency of the Council of Ministers: Camera dei Deputati, dichiarazioni programmatiche del Presidente Conte

Metalworker unions present joint platform for agreement renewal

On 4 September 2019, the metalworker trade union federations (the Federation of Metallurgical Employees and Workers (FIOM-CGIL), the Italian Metalworkers Federation (FIM-CISL) and the Italian Union of Metalworkers (UILM-UIL)) presented their joint platform of demands for the renewal of the industry-wide agreement. ^[1] Negotiations with the employer organisations Federmeccanica and Assistal are due to begin in October 2019.

The last joint platform for the metalworking industry was presented in 2007, with many of the surrounding years being marked by separate sectoral agreements and divisions over negotiations. The industry-wide agreement of 2016 was signed jointly by the three industry federations and the current platform consolidates this new unitary phase.

The 2019 platform includes the:

• request for an 8% increase of minimum wage rates
• negotiation of a regulatory framework to promote the use of smart work and telework
• strengthening of contractual welfare, including at company level
• revision of the job classification system
• establishment of a system of skill assessment and development
• full implementation and reinforcement of workplace participation rights, as provided by the current sectoral agreement

The platform was discussed and voted on in worker assemblies in September and October 2019. Over 358,000 employees from more than 6,100 firms voted and 96% approved the platform. ^[2]

Agreement signed on determining trade union representativeness

On 19 September 2019, an agreement for the implementation of the measurement of trade union representativeness was signed by the General Confederation of Italian Industry (Confindustria), the Italian General Confederation of Labour (CGIL), the Italian Confederation of Workers’ Trade Unions (CISL), the Italian Labour Union (UIL), the National Social Security Institute (INPS) and the National Labour Inspectorate (INL). ^[3] The agreement specifies the procedures for the collection of data on membership and on the election of unitary workplace trade union structures (RSU), as well as the responsibilities for the calculation of the representativeness indicator.

For each trade union, the representativeness indicator is the average of the percentage of all union members belonging to the relevant organisation and the percentage of valid votes received by the same organisation in the election of RSUs. Trade unions with at least 5% representativeness will be able to participate in national industry-wide bargaining, while sectoral agreements will be valid if signed by unions with a joint representativeness of 50% plus 1. The data on trade union representativeness will be published by the end of July of the year following the collection of data.

This agreement should overcome the administrative difficulties that have hindered the implementation of the rules on trade union representativeness, which were established more than five years ago.

Gap between centre–north and south widens

Early findings from the annual report on the economic and social situation in the south of Italy, prepared by the Association for the Development of Industry in the South (SVIMEZ), points to increasing gaps between the region and the rest of the country in terms of employment. ^[4]

In 2018 and early 2019, the centre-north showed signs of economic recovery and employment creation, whereas the south experienced stagnation, lower employment (-1.7%) and growing job insecurity, as open-ended contracts decreased (-2.3%) and temporary employment grew (+2.1%). Female employment remained particularly low, with a participation rate of 35.4% in 2018, compared with 62.7% in the centre-north.

The outflow of residents is a particular concern. In 2017, around 132,000 residents emigrated from the south, including young people (almost 67,000) and young people with a tertiary education (approximately 22,000). According to the SVIMEZ, such a growing gap and the prospects of a recession in the south can only be addressed by a special programme of investments in economic, environmental and social infrastructures, as well as in human capital and innovation policies for enterprises.

Commentary

The establishment of the new coalition government between the M5S and the Democratic Party may open a new phase in employment and social policies, especially if the significant measures on the agenda are devised through dialogue with social partners. Tensions persist between the coalition parties and it will only be possible to assess the prospects of the current government after the forthcoming budget law is passed.