The new special tax regime for ‘inpatriate’ employees, set by Art. 5 of Legislative Decree No. 209/2023, no longer provides for the possibility of extending its duration beyond the fifth tax year following the transfer of tax residence in Italy pursuant to Art. 2 of Presidential Decree No. 917/1986.
An exception is applicable only in case the employee has transferred his residence to Italy during 2024. The same applies to employees who are still subject to the former tax regime for ‘inpatriates’ (Art. 16, Legislative Decree No. 147/2015). More specifically, referring to ‘inpatriate’ workers whose fifth tax period of application of the special tax regime expired on 31 December 2023, a clear distinction must be made between those who transferred their tax residence to Italy by 29 April 2019 and those who moved in between 30 April and 2 July 2019.
Employees who moved to Italy between 30 April and 2 July 2019
Workers who have transferred their tax residence to Italy pursuant to Art. 2 of Presidential Decree No. 917/1986 in the period between 29 April and 2 July 2019 and in respect of whom the special tax regime for ‘inpatriates’ has been applied, may continue to benefit from the favourable tax regime for a further five tax years – i.e. until 31 December 2028 – if, on 31 December 2023:
• They have at least one minor or dependent child, including children in pre-adoptive foster care, or
• They have become the owner of at least one residential property unit in Italy, after the transfer of tax residence in Italy or in the twelve months preceding such transfer. In this regard, it should be considered that the residential unit may be acquired directly by the worker or by the worker’s spouse, cohabiting partner or children, even in co-ownership.
In the further years during which the special tax regime continues to apply, only 50% of the income produced in Italy contributes to the formation of the overall taxable income; if the ‘inpatriate’ worker has at least three underage or dependent children, including children in pre-adoptive foster care, only 10% of the income produced in Italy contributes to the formation of taxable income. At the end of the 5th year – which, for those who moved to Italy between 30 April and 2 July 2019, coincides with 31 December 2023 – employees are required to provide documents certifying the existence of the aforementioned subjective requirements allowing them to benefit from the favourable tax regime for five further years. The employer agent will withhold taxes on the 50% or 10% portion of taxable income starting from the month following the acquisition of the request submitted by the employee concerned. At the end of the 2024 tax period, the withholding agent will proceed with the reconciliation between the withholdings made and the tax actually due on the total amount of income produced in 2024.
Employees who moved to Italy by 29 April 2019
Workers who transferred their tax residence in Italy pursuant to Art. 2 of Presidential Decree no. 917/1986 by 29 April 2019 and who, as of 31 December 2019, are beneficiaries of the special tax regime for ‘inpatriates’ (Art. 16, Legislative Decree no. 147/2015) are entitled to exercise the option for the extension of the period of application of said tax regime in compliance with the terms and conditions established by the Revenue Agency (Agenzia delle Entrate, Order no. 60353 of 3 March 2021).
More precisely, the aforesaid option may be exercised:
a) on condition that the ‘inpatriate’ worker has been enrolled in the Register of Italians residing abroad (AIRE) or is a citizen of an EU Member State
b) subject to payment, by 1st July 2024, of an amount equal to
1) 10% of income from subordinate employment (or equivalent) and self-employed work produced in Italy and subject to the favourable tax regime received in the year before the one in which the option is taken, and provided that at the time of the (formal) exercise of the option the worker concerned
• has at least one minor child, including children in pre-adoptive foster care or
• has become the owner of at least one residential property unit in Italy after the transfer of residence or during the previous 12 months or has become the ownee of such a unit within 18 months from the date of exercise of the option.
In this regard, it should be considered that the real estate unit may be acquired directly by the worker or by the worker’s spouse, cohabiting partner or children, even in joint ownership,
2) 5% of income from subordinate employment (or equivalent) and self-employed work produced in Italy and subject to the special tax regime relating to the tax period preceding that in which the option is exercised, if at the time of exercising the option the worker • has at least three minor children, including children in pre-adoptive foster care and • becomes (or has already become) the owner of at least one property unit in the manner described in subpar. (b) above.
By note no. 1091 of 18 June 2024 and note no. 1133 of 24 June 2024, the National Labour Inspectorate (INL) issued clarifications with respect to the sanctions regime in force in the matter of unlawful or fraudulent supply of labour, which, as a result of new provisions recently set by Art. 29(4) of Decree-Law no. 19/2024, has become a criminal offence.
This provision, in force as from 2 March 2024, has brought significant changes to the sanctions regime governed by Art. 18 of Legislative Decree No. 276/2003, establishing that the unauthorised exercise of the activity of outsourced labour supply provider – both permanent and fixed-term – is punishable by i) imprisonment of up to one month or, alternatively, ii) a fine of € 60 for each worker employed and for each day of work. The same penalty system also applies to users who avail themselves of workers under an unlawful labour supply scheme.
As specified by INL, the aforementioned fine – applicable in case of unauthorised exercise of the activity of supplying both the subcontractor and the user – amounts to 72 euros for each day of work (60 euros + 12 euros) and for each worker involved in application of the increase provided for to the extent of 20 per cent by virtue of Article 1, c. 445, let. d) of Law no. 145/2018.
A stricter penalty system applies in case of fraudulent supply (Art. 18(5-ter), Legislative Decree No. 276/2003). Therefore, when the supply of labour is put in place with the specific purpose of circumventing mandatory rules set by law or collective bargaining, both the supplier and the user are punished with i) detention for up to three months or ii) a fine of EUR 100 for each worker involved and for each day of work performed under fraudulent supply, raised to EUR 120 pursuant to Art. 1(445) of Law no. 145/2018.
In any event:
• The imposition of the penalty is preceded by the mandatory prescription measure adopted by the supervisory body that ascertained the violation.
In fact, ‘for the purpose of eliminating the contravention ascertained, the supervisory body (…) shall issue the offender with an appropriate prescription, setting a deadline for regularisation that does not exceed the period of time technically necessary’ (Art. 20 et seq. of Legislative Decree No. 758/1994);
• The amount of the fine cannot be lower than EUR 5,000 or higher than EUR 50,000 (Art. 18(5-quinquies), Legislative Decree No. 276/2003). Thus, the minimum threshold of EUR 5,000 may be reduced to 25% (EUR 1,250) when the offender has complied with the mandatory prescription (Art. 21(2), Legislative Decree No. 758/1994).
The employment of workers in breach of the rules laid down on supply takes on criminal importance when the conduct is carried out:
• After 1° March 2024,
• Before 2 March 2024, but continued after 1° March 2024. In this case, the amount of the fine shall also be determined by taking into account the number of workers involved and the number of working days of employment in violation of the provisions in force concerning staff leasing even before 2 March 2024. On the other hand, the conduct that began and ended before 2 March 2024 remains subject to the previous non-criminal penalty regime.
Concerning recidivism, it is necessary to distinguish between:
a) Simple recidivism, which occurs when the offence of unlawful or fraudulent supply of labour, sanctioned pursuant to Art. 18(1) and (5-ter) of Legislative Decree no. 276/2003, has been committed by an employer who, in the previous three years, has already been the recipient of a definitive criminal or administrative sanction for the offences referred to in Art. 1(445), let. d) of Law no. 145/2018 and other than those sanctioned under the aforementioned Art. 18 of Legislative Decree no. 276/2003. This concerns, for example, the sanction imposed on account of the use of irregular labour. In this case of recidivism, the surcharge is applied to the extent of 40%. Therefore, where the employer who has already been convicted with a final judgment for resorting to irregular labour commits the offence of illegal supply of labour, the penalty of EUR 60 – applied for each worker and for each day of work performed – is increased to EUR 84 (EUR 60 + 40%). In case of fraudulent supply of labour, the fine is increased to EUR 140 (EUR 100 + 40 per cent). It is understood that the penalty affecting the supplying party shall also be imposed on the user.
b) Specific recidivism, which occurs when the employer, during the previous three years:
• Has repeated the offence of illegal or fraudulent labour supply or
• The offence of unlawful or fraudulent supply was preceded by the employment of one or more workers under a non-genuine contract or posting in breach of Articles 29(1) and 30(1) of Legislative Decree no. 276/2003 respectively. Configuring, in both cases, conduct sanctioned by the same Art. 18 of Legislative Decree no. 276/2003. In such a case, in addition to the 40% increase contemplated for simple recidivism, a further 20% increase is applied.
Therefore, in this last scenario, the fine imposed on both the supplier and the user, amounts to EUR 100.80 for each worker and for each day of work (EUR 60 + 20% = 72 + 40% = 100.80).
In case of fraudulent supply of labour, the specific recidivism results in the imposition of a sanction on both the subcontractor and the user of EUR 168 (100 + 20% = 120 + 40% = 168) for each day of work and for each worker employed.
In its judgment no. 15957 of 7 June 2024, Corte di Cassazione stated that the presence of a stressful work environment is an unfair occurrence that, even in the absence of employer’s conduct constituting mobbing, entitles employees to compensation for damage to their health.
In the case at hand, the employee took legal action aimed at obtaining compensation for the harassment suffered by the employer and ‘consisting of hostile conduct of a discriminatory and persecutory nature, which resulted in the moral mortification and marginalisation of the same in the working environment, with detrimental effects on her psycho-physical balance and personality’.
As a preliminary remark, Corte di Cassazione reiterated the definitions of ‘mobbing’ and ‘straining’.
Notably, according to well-established case law, ‘the notion of mobbing, like that of straining, is a medico-legal notion that has no independent relevance for legal purposes and only serves to identify conduct that is in conflict with Art. 2087 of the Civil Code and with the regulations on the protection of health in the workplace’. ‘Mobbing at work’ is conceivable where there is ‘both the objective element, consisting of a continuous conduct detrimental to the person within the employment relationship, and the subjective element of the persecutory intent against the victim, regardless of the intrinsic legitimacy of each conduct, inasmuch as the concrete intentional connotation also colours in an illicit sense conduct otherwise abstractly legitimate, all in accordance with a legal framework fully framed in the civil law context, where it is considered that the intentional determination of damage to the employee’s person by the employer is, per se, reason for violation of Art. 2087 of the Civil Code and therefore of contractual liability, even with the greater effects of Article 1225 of the Civil Code for the case of intent’. Straining, on the other hand, is ‘configurable when there is stressful conduct knowingly implemented against an employee, even if there is no plurality of vexatious actions’.
The Supreme Court then noted that, on the subject of protecting the health of workers, ‘a stressful working environment is configurable as an unfair fact, which can also lead to the re-examination of all the other employer’s conduct alleged as harassing, even if apparently lawful or only episodic, since the protection of the fundamental right of the worker’s person finds a direct source in the constitutionally oriented reading of Article 2087 of the Civil Code’. On these grounds, the Court upheld the employee’s appeal, recognising her right to compensation for damage.