Government measures in key jurisdictions 4th edition - Flipbook - Page 73
Italy
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For the avoidance of doubt, the SACE’s guarantee is not available to companies which directly or
indirectly control (or are controlled by), pursuant to Article 2359 of the Italian Civil Code, a company
resident in a country or territory that is not cooperative for tax purposes (as identified in the
conclusions of the Council of European Union dated 18 February 2020). Companies with
“deteriorated” debt exposures, or “in difficulty” cannot benefit from this scheme.
Loan repayment suspension: SMEs may postpone payment of principal and interest on any
loans. Revocable credit lines and factoring facilities cannot be revoked until 31 January 2021 if the
SME sends relevant notice to creditors. As to the applicability criteria, the same criteria as per the
CSGF paragraph above will apply.
Employment The Italian Government introduced the following schemes to support businesses:
What financial
support is the
government
providing to
businesses and to
individuals on
employment
issues?
•
A. Social programs: if an employer must suspend employees from work since the business
activity is suspended or reduced due to the Covid-19 emergency, it can apply for the following
social funds (wage subsidy schemes):
1.Cassa Integrazione Guadagni Ordinaria (CIGO): available to industrial companies staffed with
more than 15 employees.
2.Fondo d’Integrazione Salariale (FIS): available to non-industrial employers enrolled with
FIS that are staffed, as an average, with more than 5 employees.
3.Cassa Integrazione Guadagni in deroga (CIGD): available to all businesses, even very small ones,
that are not covered by CIGO/FIS. It is partially managed at a Regional level and so each Region has
its own procedure and bureaucracy.
Under the above schemes, which normally imply a consultation with the Trade Unions before being
implemented, employees who are suspended from work receive an allowance from the social security
authority (“INPS”) equal to 80% of the lost salary with a cap of €1,129 net per month. These schemes are
intended to be used in favour of only those employees who were in force on 25 March 2020 and
initially covered a period of 18 weeks until 12 July 2020. Recently, they have been extended to cover
additional 18 weeks effective from 13 July and until 31 December 2020.The last 9 weeks remain free of
charge only for employers which in the first semester of 2020 suffered a drop in turnover exceeding 20%
compared with the same period in 2019. Otherwise, employers are required to pay a contribution equal
to 9% of salary for the hours not worked by employees (increased to 18% if no drop in turnover
occurred).
As an alternative to the use of the above schemes, an exemption from social security contribution
obligations covering a period of up to 4 months has been recently introduced in favour of employers that
used social plans in May and June but did not apply for the above 18-week-extension.
In parallel with this new range of COVID-19 related social plans, the Italian Government introduced a
firing ban which was initially intended to last until 17 August 2020. The ban regards both collective
and individual dismissals for redundancy reasons (some categories are excluded, such as executives or
domestic employees, and disciplinary dismissals remain of course feasible).
Recently, this ban has been extended until 31 December 2020 but with a few exceptions. Indeed,
dismissals are now allowed for (i) companies ceasing their business activity and put under a liquidation
procedure; (ii) companies which went bankrupt; and (iii) companies which enter into a collective
agreement with trade unions providing for the payment of an incentive to leave to those redundant
employees who accept to mutually terminate their employment relationship. Companies will also be
able to dismiss employees if they have used up all the social plans made available and/or the new 4month social security exemption. Therefore, dismissals seem to remain prohibited until companies are
at least potentially allowed to use the new 18-week social plans lasting until 31 December 2020.
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Government measures in key jurisdictions