In circular no. 32 of 22 February 2021, INPS provided the first clarifications on using the contribution exemption, introduced by the 2021 Budget Law, to recruit female workers carried out in the two years 2021-2022.
Article 1, paragraph 16, of Law 178 of 30 December 2020 (the “2021 Budget Law“) states that the contribution exemption for hiring women workers in the 2021-2022 period under Article 4, paragraphs 9 to 11, of Law no. 92 of 28 June 2012 (the Fornero Reform), is 100 per cent up to €6,000 yearly.
Paragraph 17 of the same article specifies that the exemption application is subject to the requirement of a net increase in the employer’s employment, calculated based on the difference between the number of workers employed in each month and the average number of workers employed in the previous 12 months.
According to the EU law conventional criterion, to identify the employment increase, the number of employees is calculated in Annual Work Units (AWU).
The circular does not provide any operational instruction since the benefit application is subject to the European Commission authorisation. After this authorisation, a new message will be issued concerning the compilation of the contribution declarations by employers who intend to access the benefit.
Employers entitled to the benefit
All private employers, including non-entrepreneurs and employers in the agricultural sector, are eligible for the benefit.
The exemption from social security contributions does not apply to Public Administrations, which can be identified by referring to Article 1, paragraph 2, of Legislative Decree of 30 March 2001 no. 165.
Workers entitled to the exemption
An express reference made by the 2021 Budget Law indicates that the incentive is a natural extension of the Fornero Reform regulations.
The concept of “disadvantaged women“, for whom the exemption is applicable if hired, includes the following categories:
To receive the benefit, either a long-term state of unemployment (more than 12 months) or compliance with the inactivity requirement (the woman must be “unemployed“) is required, along with other conditions.
The late submission of the compulsory electronic communications relating to the establishment and modification of an employment or staff leasing agency relationship entails the loss of a part of the incentive related to the period between the relationship’s starting date and late communication date.
Types of incentivised employment relationships and exemption duration
The incentive is available for:
As for its duration, INPS specified that the incentive would be available for
The incentive can be suspended when there is a compulsory absence from work due to maternity, allowing for a period of temporal deferment.
The right to benefit from the incentive is subject to a net increase in employment and compliance with incentives’ general principles established by Article 31 of Legislative Decree no. 150/2015, under the following conditions laid down in Article 1 paragraph 1175 of Law no. 296/2006, namely:
Under Article 2 paragraph 32, of Regulation (EU) no. 651/2014, the net increase in employment is “the net increase in the number of employees in the establishment compared to the average for a reference period. Jobs eliminated during that period are to be deducted, and the number of workers employed full-time, part-time or seasonally is to be calculated, taking into account fractions of annual work units.”
As already clarified in question no. 34/2014 of the Ministry of Labour and Social Policies, the employer must verify the actual workforce present in the 12 months following the facilitated hiring and not “estimated” employment.
If the employer should find a net increase in employment in terms of Annual Work Units at the end of the year following the hiring, the monthly quotas of the incentive already received are “consolidated.” Otherwise, the incentive cannot be legitimately applied, and the employer must return the individual quotas of the incentive already received in the absence of compliance with requirements through the relevant procedures.
Under Article 32, paragraph 3, of Regulation (EU) no. 651/2014, is applicable if the net employment increase is not realised because the previously available job(s) became vacant due to:
Combination with other incentives
The exemption can be combined with other exemptions within the limits of the social security contribution, and if there is no express prohibition to combine with different schemes for additional exemptions.
If the exemption can be combined with another benefit, for applying the second benefit it is necessary to refer to the “due” contribution or “due” residual contribution because of the first exemption applied.
The sequence which allows combinations of exemptions under the rules approved, in chronological order, on the assumption that the last exemption introduced in the system is combined with the previous on the residual “due” contributions.