Influencerand agency relationship: Court of Rome’s guidelines

20 June 2024

Regarded as probably the most innovative job of recent years, the activity of influencers, which is on the rise in the large financial market of the internet, is not only the most coveted profession among the very young, but also a profitable resource for all those companies that collaborate with these popular and influential market figures, for their own commercial purposes, and the promotion and sale of products.

However, the ever-increasing visibility and use of influencers, the face in some cases of real corporate propaganda, is accompanied by as yet ill-defined employment laws governing the collaboration relationship between influencers and commissioning companies.

In this context, a recent  Court of Rome ruling is of particular interest. In judgment no. 2615 of 4 March 2024, dealing with the classification of the collaboration relationship between influencer and commissioning Company, the Court held that the relationship fell under the contractual category of an agency relationship under Article 1742 and following of the Italian Civil Code.

Following an inspection, the Rome Inter-regional Labour Inspectorate had considered certain influencers employed by the claimant Company to be classifiable as Commercial Agents and required the company to pay contributions to the National Assistance Organisation for Commercial Agents and Representatives (Ente nazionale di assistenza per gli agenti e i rappresentanti di commercio, ‘ENASARCO’) Social Security Fund and to the Severance Indemnity Fund.

The influencers’ activities

The Company was a wholesale food supplement business. Its sales were mainly through its own websites and it used a number of people in online promotion and sale of its products. The company collaborated with professional athletes and personal trainers with whom the Company had signed collaboration agreements relating to sponsorship, testimonials and “influencer services”.

In their capacity as sponsors and providing testimonials, professional athletes undertook to use their image, to participate in official competitions, to wear Company-sponsored clothing, and to publish fitness-related articles and videos on the company website. In return for these undertakings, there was a fee, agreed in advance, which was totally unrelated to the company achieving its sales results.

The “influencer activity” was different and consisted of the collaborators undertaking to promote the Company’s products through their social channels: Facebook, Instagram, Twitter, YouTube, with the aim of influencing their followers and promoting the commissioning company’s products on a large scale.

During the promotional activities on their web pages, the influencers indicated a customised discount code linked to the Company’s platform. The use of the discount code allowed the Company to trace the orders received back to the influencer through which the buyer was purchasing the product. In this event the parties had agreed on a percentage of profit on the orders attributable to the influencer.

From the evidence it emerged that through the professional’s ability to grant discounts to user followers she “was actually carrying out sales promotion activity where the remuneration was determined by the orders directly procured and successfully completed by the collaborator”.

From the inspection of the invoices issued, it appeared that the above-mentioned appointments were long-term and took the form of multi-year continuous collaborations.

The Inspectorate’s view and its confirmation by the Court

With respect to the Inspectorate’s finding, the claimant Company argued that the conditions necessary to classify the influencers as Commercial Agents were missing on the basis of the following factors: (i) the existence of a permanent professional services contract under which the services were provided, (ii) the absence of a permanent on-going appointment for the promotion and conclusion on behalf of the Company of sales contracts in a specific area, (iii) the absence of a specified scope of work, which is typical of the contract referred to in Article 1742 of the Italian Civil Code.

Refuting the points raised by the Company, the Inspectorate emphasised the typical aspects of the agency agreement, which were present in the way in which the Company employed the influencers, namely: (i) the activity carried out on a permanent basis, demonstrated by the type of agreement which was for an indefinite period and evidenced by the long-standing issuance of invoices, (ii) the purpose of the agreements entered into with the Company, not limited to mere propaganda but to the promotion and sale of products complete with a discount code made available by the influencer, (iii) the percentage of profit associated with the purchase of the product by the user and (iv) the presence of a specified area, which in view of the new consumer purchasing methods based on an online ‘click’, can be traced back to the community of followers.

The Court of Rome agreed with the Inspectorate that the influencer in this case fell within the classification of Commercial Agent and ordered the Company to pay the ENASARCO contributions, ruling on an issue which is not yet regulated.

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