HReview – A digest of Italian HR Management

On 1 January 2026, Law No. 199/2025, entitled ‘State Budget for the 2026 financial year and multiannual budget for the 2026–2028 three-year period’, entered into force.
With regard to matters relevant for personnel administration, this Law introduced developments and amendments concerning the tax regime applicable to employment income, incentives for businesses and protection of parenthood, wage support schemes, supplementary pension schemes and pensions.

Substitute tax on pay increases granted pursuant to collective bargaining renewals (art. 1, paras. 7 and 12)

Pay increases paid during 2026 to employees of the private sector as a result of collective bargaining agreements – national, territorial or company-level – entered into between 1 January 2024 and 31 December 2026 are subject to a substitute tax in lieu of IRPEF and local taxes, set at 5%.

The favourable tax regime, introduced in order to support wage adjustment to the cost of living while strengthening the link between productivity and remuneration, applies only to employees who, during 2025, were in receipt of employment income not exceeding EUR 33,000 gross.
Eligible employees may also waive the application of the favourable tax regime by formally notifying the withholding agent of their intention.

Substitute tax applied to performance-related bonuses introduced by territorial or company-level collective agreements (art. 1, paras. 8 and 9)

Art. 1(182) of Law No. 208/2015 provides, as a general rule, that performance-related bonuses of a variable amount, linked to increases in i) productivity, ii) profitability, iii) quality, iv) efficiency and v) innovation, are subject to a substitute tax in lieu of ordinary IRPEF income tax, as well as regional and municipal surtaxes, at a rate of 10%; unless the employee formally waives such regime, the more favourable tax treatment applies to a measurable and verifiable performance bonus with an overall amount not exceeding EUR 3,000.

Regarding performance-related bonuses paid during 2025, said tax regime is applied, as provided for by art. 1(385) of Law No. 207/2024, at the more favourable rate of 5%.

In relation to performance-related bonuses paid during 2026 and 2027, the substitute tax will apply up to the more favourable overall threshold of EUR 5,000 and at the further reduced rate of 1%.

The above tax regime also applies to amounts paid under the declared heading of employee profit-sharing during the years 2025, 2026 and 2027.

Employee financial participation schemes (art. 1, para. 13)

For 2026 as well, art. 6(1) of Law No. 76/2025 continues to apply, pursuant to which dividends paid to employees and deriving from shares allocated in substitution for performance-related bonuses due under the aforementioned art. 1(182) of Law No. 208/2015 are exempt from income tax for 50% of their amount, up to an annual limit of EUR 1,500.

Revision of IRPEF income tax rates (art. 1, para. 3)

Amendments are introduced to the ordinary tax regime applicable to employment income referred to in art. 49 of TUIR.

With effect from 1 January 2026, the rate applicable to income exceeding EUR 28,000 and up to EUR 50,000 is reduced from 35 to 33%, while the income brackets already amended by art. 1, paragraph 2, of Law No. 207/2024 for the tax period in progress as of 1 January 2025 are confirmed.

New tax rates and corresponding income brackets are summarised below:

Limits on tax deductions (art. 1, para. 4)

With exclusive reference to taxpayers with total income exceeding EUR 200,000, the amount of the deduction from gross tax is reduced by EUR 440 in relation to the following expenses:

• expenses whose deductibility is set by the TUIR – as well as by any other tax provision – at 19 per cent. Healthcare expenses referred to in art. 15(1)(c) of TUIR are excluded from the scope of this reduction,
• charitable donations to political parties,[1]
• insurance premiums covering risks arising from catastrophic events.[2]

Substitute meal allowances provided in electronic form (art. 1, para. 14)

The tax treatment of meal vouchers provided by employers to employees is amended.

With effect from 1 January 2026, such benefits do not contribute to taxable employment income up to a daily total amount of EUR 10, where provided in electronic form.

The non-taxable threshold applicable to non-electronic meal vouchers remains unchanged at EUR 4.

The tax exemption up to a daily total amount of EUR 5.29, applicable to substitute meal allowances granted to workers employed at construction sites, other temporary work locations or production units located in areas lacking catering facilities or services, is confirmed.

Application of the substitute tax to shift allowances and premiums for night work and work performed on public holidays and weekly rest days (art. 1, paras. 10-12)

For 2026 only, in the private sector a substitute tax in lieu of IRPEF and regional and municipal surtaxes at a rate of 15 per cent applies to:

• premiums and allowances granted to employees under the provisions of the applicable NCBA for i) night work[3] and ii) work performed on public holidays and weekly rest days,
• shift allowances and any emoluments related to shift work as established by the applicable NCBA.

Unless formally waived by the eligible employee by notifying the withholding agent, the favourable tax regime applies:

• up to an overall annual limit of EUR 1,500. For the purposes of calculating this limit, performance-related bonuses and profit-sharing amounts subject to substitute tax pursuant to art. 1(182) of Law No. 208/2015 are excluded,
• provided that the employee’s income for subordinate or assimilated forms of employment for 2025 does not exceed EUR 40,000 gross. Where the withholding agent applying the substitute tax is not the same entity that issued the single tax certification for 2025 income, the employee is required to certify in writing the amount of employment income earned during that year.

Substitute tax on foreign-source income realised by individuals transferring their tax residence to Italy (art. 1, paras. 25–26)

Persons transferring their tax residence to Italy pursuant to art. 2(2) of TUIR may opt for a flat-rate substitute tax on foreign-source income amounting to EUR 200,000 per year, provided that they have not been tax resident in Italy for at least nine years during the ten preceding the start of the option’s validity.[4]

A similar tax mechanism applies, albeit at the lower flat-rate amount of EUR 25,000, to each family member of the individual who has transferred their tax residence to Italy.

As a result of the amendments introduced by the Law under review, the above substitute tax amounts are increased to:

• EUR 300,000 per tax period where, from 1 January 2026, the individual transfers their registered residence to Italy, in compliance with the above conditions, pursuant to art. 43 of Codice Civile,
• EUR 50,000 per tax period in respect of each family member.

The legislative amendment applies exclusively to cases of transfer of registered residence, defined by the aforementioned art. 43 of Codice Civile as ‘the place where a person has their usual abode’.

Tax treatment of variable remuneration paid to executives in the financial sector (art. 1, para. 137)

Amendments are introduced to the tax regime governing the 10% IRPEF surtax applied to i) stock options and share-based incentive schemes and ii) variable remuneration or emoluments exceeding three times the fixed component of remuneration, paid to workers classified as ‘executives’ as well as to holders of coordinated and continuous collaboration arrangements, where the employer or principal is a financial intermediary or a financial holding company.[5]

With effect from the 2026 tax period, the said IRPEF surtax does not apply where the employer or principal allocates an amount at least double the total surtax due in favour of Third Sector entities that are different from those directly or indirectly controlling (or controlled by) the entities paying the remuneration.

The procedures and deadlines for payment of the said amount will be set out in a specific measure of the Italian Revenue Agency.

Scope of application of the flat-rate regime (art. 1, para. 27)

The increase to EUR 35,000 of the threshold for employment income (art. 49 of the TUIR) and income treated as employment income (art. 50 of the TUIR) received during the previous year, beyond which a worker may not apply the flat-rate regime to self-employment income (art. 1, para. 57, letter d-ter), of Law No. 190/2014), is extended to 2026.

The same income threshold had already been provided for 2025 by art. 1(12), of Law No. 207/2024.

[1] Art. 11, Decree-Law No. 149/2013.

[2] Art. 119(4), fifth sentence, Decree-Law No. 34/2020.

[3] Art. 1(2), Legislative Decree No. 66/2003.

[4] Art. 24-bis(1)(2) of TUIR.

[5] Art. 33, Decree-Law No. 78/2010.

Partial exemption from social contribution duties in the event of hiring or conversion of a fixed-term employment contract (art. 1, paras. 153–155)

In order to promote i) stable youth employment, ii) equal opportunities in the labour market for disadvantaged female workers, and iii) employment growth in the Special Economic Zone for Southern Italy, thereby fostering the reduction of territorial disparities, a partial exemption from the overall social security contribution duties payable by the employer is granted for permanent subordinate employment contracts entered into between 1 January and 31 December 2026.

Employers are also eligible for the exemption where, during the same period, they convert a subordinate fixed-term employment contract into a permanent one.

Said exemption – which does not apply to the hiring of executives, nor with regard to premiums and contribution due to INAIL – shall be granted to eligible employers for a period not exceeding 24 months.

The detailed regulation of the requirements and conditions for access to the exemption is entrusted to a specific ministerial decree, to be adopted on the basis of an assessment of the employment effects produced by the incentive measures i) ‘youth bonus’, ii) ‘women’s bonus’ and iii) ‘Special Economic Zone for Southern Italy – single ZES bonus’, as provided for, respectively, by arts. 22, 23 and 24 of Decree-Law No. 60/2024, converted into law, as amended, by Law No. 95/2024. Such assessment will be performed through analysis plans and a specific project implemented by the Ministry of Labour and Social Policies in conjunction with the Ministry of Economy and Finance.

The exemption shall be granted within the following expenditure limits:

• EUR 154 million for 2026,
• EUR 400 million for 2027,
• EUR 271 million for 2028.

Partial exemption from social contribution duties for the hiring of working mothers (art. 1, paras. 210-213)

In order to promote the employment of working mothers, private-sector employers who, from 1 January 2026, hire women who have been without regular paid employment for at least six months and who are mothers of at least three children under the age of 18 is entitled to benefit from a total exemption from the payment of social security contributions payable by the employer.

The exemption, which constitutes a structural measure and does not apply with regard to premiums and contributions due to INAIL, is granted up to a maximum annual limit of EUR 8,000.00.

The exemption is granted for a maximum period of:

• 12 months from the date of hiring under a fixed-term employment contract, including through agency work,
• 18 months from the date of hiring under a fixed-term employment contract, where the contract is converted into an open-ended one,
• 24 months from the date of hiring under an open-ended employment contract.

The exemption in question:

• is not cumulative with other contribution exemptions or reductions provided for by the applicable legislation,
• is compatible, without any reduction, with the increase in personnel costs eligible for deduction from business income in the event of new hires under open-ended subordinate employment contracts,[1]
• does not apply to domestic work and apprenticeship relationships.

Parental leave and leave for illness of minor children (art. 1, paras. 219–220)

With effect from 1 January 2026, the possibility for a working parent to take compensated parental leave periods is extended until each child reaches the age of fourteen, instead of the previous limit of twelve years of age.[2]

This extension of the time limit for taking parental leave also applies in the case of:

extension of parental leave for each minor child with high support needs,[3]

adoption, both domestic and international, and fostering arrangements.[4]

Amendments are also introduced to the rules governing leave for periods of illness of each child, with an extension of its scope of application.[5]

Where the provisions in force until 31 December 2025 allowed the working parent to benefit from this type of leave in relation to a child aged between 3 and 8 years, with effect from 1 January 2026 such leave may be taken where the illness affects a child aged between 3 and 14 years. The number of annual working days during which each working parent is entitled to abstain from work due to a child’s illness is also increased from 5 to 10.

The leave is also granted where the child is fostered or adopted.

Extension of fixed-term employment contracts entered into as replacements for workers on leave (art. 1, para. 221)

Employers may hire workers under fixed-term employment contracts to replace female or male workers on maternity, paternity or parental leave, including up to one month prior to the start of such leave.[6]

With effect from 1 January 2026, these fixed-term employment contracts may also be extended after the return to work of the replaced worker, for an additional overlap period of a duration not exceeding the child’s first year of age (art. 4, para. 2-bis, of Legislative Decree No. 151/2001).

[1] Art. 4, Legislative Decree No. 216/2023.

[2] Art. 32(1), Legislative Decree No. 151/2001.

[3] Art. 33, Legislative Decree No. 151/2001.

[4] Art. 36, Legislative Decree No. 151/2001.

[5] Art. 47, Legislative Decree No. 151/2001.

[6] Art. 4(1)(2), Legislative Decree No. 151/2001.

INPS Treasury Fund: obligation for all employers with a headcount of 60 or more employees (art. 1, para. 203)

The 2026 Budget Law provides that, for all companies with an average workforce[1] of 60 employees or more in 2025, the TFR of workers who have not opted for allocation to a pension fund will no longer remain within the company, but will instead be accrued with the Treasury Fund managed by INPS, where employers will pay a monthly contribution equal to the amount of TFR accrued by each employee. From 2028, the headcount limit will be lowered to 50 and, as from 2032, the obligation will be extended to companies with an average workforce of not less than 40 employees.

We recall that the obligation to pay TFR into the Treasury Fund established with INPS had been limited, from 2007 and until the introduction of this new provision, to companies with a workforce equal to or exceeding 50 employees:

• as at 31/12/2026, or
• at the end of the first year of activity.

It is worth noting that the accrual obligation established by exceeding the threshold in any year will remain even in case the employer, in the future, falls below the relevant threshold once again.

As the literal phrasing of the law is open to different interpretations, we await imminent instructions and clarifications from competent Authorities.

[1] INPS, circular message No. 70/2007.

Regulation (EU) 2024/1689 of 13 June 2024, in force from 1 August 2024, lays down harmonised rules on artificial intelligence (AI). This is a legal instrument of considerable complexity, which will acquire full legal effect in its entirety only as from 2 August 2026 (art. 113). More specifically, the provisions on prohibited AI practices apply from 2 February 2025; the codes of good practice were defined in July 2025 (art. 56), while from 2 August 2025, inter alia, the provisions on general-purpose AI models (Chapter V) and on governance (Chapter VII) apply.
In particular, the provisions governing the use of high-risk AI systems – such as, by way of example, systems operating in the fields of employment and worker management (Annex III, No. 4) – will apply only from 2 August 2026.

Without prejudice to the possibility that the national legislature may introduce its own regulatory framework in advance of the timetable set out in the Regulation, a transitional phase therefore commenced on 2 August 2024, allowing the provisions of the Regulation to be ‘assimilated’ and the measures necessary to ensure proper compliance to be adopted.

In this regard, however, further considerations are required.

A practical case
Let us assume the case of an employer who, as of 1 February 2026, already uses an AI system to manage its production processes; let us also assume that any malfunction of such system may expose workers present in the workplace to a serious risk to health and safety. In such a case, can it be argued that, in light of art. 113 of the Regulation, the provisions contained therein are of no relevance?

Possible solutions to the practical case
Art. 28(1), of Legislative Decree No. 81/2008 imposes an obligation to assess all risks to health and safety, and art. 29(2), of the same decree provides that the risk assessment must be immediately reviewed whenever changes to the production process or the organisation of work significantly affect workers’ health and safety. That provision also requires the risk assessment document to be revised by the employer i) in relation to developments in technology, prevention or protection, ii) following significant accidents, or iii) where the results of health surveillance indicate the need to do so.

Moreover, failure to assess the risk arising from the adoption of an AI system that exposes workers to risks to their health and safety may give rise to administrative liability for the entity (art. 25-septies of Legislative Decree No. 231/2001).

Accordingly, where the scenario outlined above arises, how should the assessment of risks deriving from the use of such an AI system be carried out?

A contribution towards a legally sound answer may be found in art. 2087 of the Civil Code, pursuant to which, as is well known, ‘the entrepreneur is required to adopt, in the conduct of the business, the measures which, according to the nature of the work, experience and technology, are necessary to protect the physical integrity and moral personality of workers’. In light of the consolidated case law developed with reference to that provision, it is reasonable to conclude that the rules laid down by Regulation (EU) 2024/1689 of 13 June 2024 concerning AI systems, in force from 1 August 2024, cannot be disregarded, since the employer is required to adopt measures of prudence and diligence in compliance with technical and experiential standards, such that ‘employer liability arises not only where harm to health results from the breach of specific obligations imposed by statutory provisions, but also where such obligations are suggested by experimental or technical knowledge’ (Corte di Cassazione, order No. 1509/2021). An even more recent judgment confirms the principle whereby employer liability must be linked ‘to the breach of behavioural obligations imposed by statutory provisions or suggested by experimental or technical knowledge at the relevant time’ (Corte di Cassazione, No. 10115/2022).

It may therefore reasonably be considered that an employer using a high-risk AI system whose potential malfunction exposes workers to a serious and immediate risk to health and safety cannot fail to rely on – and comply with – certain provisions of the Regulation for the purposes both of risk assessment and of identifying and adopting appropriate technical and organisational measures to address the identified risks, such as, by way of example:

• art. 26, concerning the obligation of the user/employer – understood here as the deployer pursuant to art. 3, point 4 – of a high-risk system to adopt appropriate technical and organisational measures ensuring that the system is used in accordance with the technical documentation (art. 11) and the instructions for use (art. 13) provided by the supplier. Moreover, the deployer is required to i) promptly notify the supplier of any malfunction of the AI system where such malfunction gives rise to risks to health or safety, and ii) suspend its use (arts. 26, para. 5, and 79, para. 1),
• art. 27 on fundamental rights impact assessments,
• art. 14 on ‘human oversight’, requiring the designation of an individual or collective body entrusted with supervising the system and vested with the power to intervene in its operation, including, where deemed necessary, to ‘stop’ it. More specifically, since it is established that ‘high-risk AI systems shall be designed and developed, including with appropriate human–machine interface tools, in such a way that they can be effectively overseen by natural persons during the period in which they are in use’ (art. 14, para. 1), the adequacy of such interface tools assumes crucial importance in the choice of the AI system that the deployer intends to use.

Furthermore, the above technical and organisational measures could be adopted in the form of a (uniform) management system, also in light of ISO/IEC 42001:2023 (Information technology – Artificial intelligence – Management System).

Corte di Cassazione, with judgment no. 30821/2025, held that the use of private investigators is lawful where an employee falsely states in service reports that they were present in specific locations, whereas in reality they remained inside the company vehicle in different places.

In the case at hand, the employer decided to engage an investigative agency as part of a broader strategy to intensify checks on employees’ activities, made necessary by repeated negative reports from customers (“We continue to receive complaints from our members concerning frequent stops or even prolonged parking of our service vehicles at bars and tobacconists, parking on land owned by the guards themselves and even on land belonging to persons not associated with this body, … and, in any event, the almost total absence from the territory under our responsibility.”).

Corte di Cassazione considered the employer’s conduct to be lawful precisely because the mandate given to the investigative agency was not aimed at a general monitoring of the proper performance of the employment duties, but rather targeted at verifying specific unlawful conduct. The judgment clarifies that the employer had implemented a dual system of checks:

• monitoring of the performance of the employment obligation, entrusted directly to the Company Director,
• monitoring of criminally relevant and/or fraudulent conduct, aimed at ascertaining behaviour detrimental to the company’s assets and reputation, specifically entrusted to the investigative agency.

The Court held that the control carried out by the investigative agency was lawful because its purpose was to ascertain “unlawful conduct capable of deceiving the employer and harming not only the company’s assets but also its image and reputation externally”.

This approach, in addition to being well founded, is consistent with settled case law, according to which controls carried out through investigative agencies are permissible where they do not encroach upon supervision of the employee’s actual work performance, but are instead directed at establishing unlawful acts by the employee that go beyond mere contractual non-performance, particularly where there is a well-founded suspicion.

On 5 November 2025, negotiating unions renewed the national collective bargaining agreement for executives of companies operating in the tertiary sector. The Agreement is intended to apply for the period from 1 January 2026 to 31 December 2028.

Through this agreement, the Parties recognise the value of bilateralism as a founding principle of collective bargaining, capable of developing concrete tools to address current processes of economic, technological and social transformation. They also pursue the objective of safeguarding managers’ purchasing power, thereby enabling companies to plan labour costs more effectively.

In addition to provisions on economic treatment, the agreement under review:

• strengthens contractual welfare measures,
• provides for adjustments to employer contributions for supplementary pension schemes and insurance against accidents,
• introduces amendments concerning the scope of application of the NCBA, gender equality, pay transparency, continuous training, parenthood and serious illnesses,
• introduces new social protections with the declared aim of addressing demographic changes affecting the social context – notably, on practical terms, with the experimental introduction of a measure supporting the active ageing of executives, intended to encourage generational turnover while preserving sector-specific skills.

Definition of executive

In order to ensure greater protection for executives operating in corporate contexts affected by innovation processes, with particular reference to the use of artificial intelligence systems in production processes, art. 1(1) of the Agreement recognises the need to assess a possible revision of the definition of workers classified as executives under the current NCBA, including new strategic professional roles with high levels of expertise and responsibility.

By way of example only, reference may be made to the role of the human overseer entrusted by the employer/deployer with the task of human oversight of an artificial intelligence system classified as ‘high-risk’ (art. 26, para. 2 of Regulation (EU) 2024/1689).

Economic treatment

The Agreement introduces significant changes in terms of economic treatment, providing under arts. 2 and 3 for an increase in monthly actual remuneration, with a consequent revision of the applicable contractual minimum.

Specifically, a total gross monthly pay increase at full effect of EUR 800 is provided, broken down into the following instalments:

EUR 320 with effect from 1 January 2026;
EUR 260 with effect from 1 January 2027;
EUR 220 with effect from 1 January 2028.

As a result of these increases, the monthly collective minimum salary (for 14 monthly instalments), previously set by the CCNL of 12 April 2023 at EUR 4,340 with effect from 1 July 2025, is revised as follows:

EUR 4,660 with effect from 1 January 2026;
EUR 4,920 with effect from 1 January 2027;
EUR 5,140 with effect from 1 January 2028.

Regardless of the provisions set by previous renewal agreement regarding the possibility for employers to absorb contractual increases, the Parties provide that these pay increases may not be offset against or absorbed by individual treatments already agreed between employer and executive, provided that such treatments were not granted after 31 July 2025 i) as an advance or anticipation of future contractual increases or ii) expressly in order to ensure the recovery of purchasing power.

In other words, regardless of the executive’s actual salary, these increases are mandatory if no personal salary increase was granted, explicitly as payment in advance of future increases set by the NCBA, after 31 July 2025.

Welfare services for executives and their families and contributions to CFMT

In continuity with the arrangements provided on an experimental basis for the 2024-2025 period by the previous renewal agreement, for the 2026–2028 period art. 4(1) provides for the payment to all executives of an annual welfare contribution for the purchase of services through the welfare platform managed by the Centro di Formazione Management del Terziario (CFMT).

The amount of this contribution, increased from a minimum of EUR 1,000 to EUR 1,500 per year, is recognised according to the following criteria:

• it is cumulative with any flexible benefits schemes already granted by the employer,
• it is pro-rated in the event of recruitment or appointment of the executive during the year, whether on a permanent or fixed-term basis,
• it is not pro-rated in case of part-time employment.

Where the executive has not used all or part of the welfare credit available as at 31 December 2025, they may choose either to carry over the residual credit to the following year or to allocate it to the Mario Negri Fund. In the absence of communication, the Parties provide for a mechanism whereby the residual welfare contribution is recredited together with that for 2026 (art. 4, para. 2 of the Agreement). This mechanism applies to residual contribution relating to 2026, 2027 and 2028.

In order to ensure the provision of the above welfare services, for the years 2026, 2027 and 2028 the annual contribution due to CFMT (EUR 290 payable by the employer and EUR 130 by the executive) is increased by EUR 36 overall, of which EUR 18 payable by the employer and EUR 18 by the executive.

As a result of this increase, which is in any event lower than that provided for by the previous renewal agreement for the years 2024 and 2025, annual contribution will amount, between 2026 and 2028, to:

• EUR 308 payable by the employer,
• EUR 148 payable by the executive.

Furthermore, in order to provide greater support for active measures aimed at the redeployment of executives, arts. 11 and 11-bis reduce from EUR 2,500 to EUR 2,000 the contribution that employers must pay to CFMT, in the event of termination of the employment relationship – including by mutual agreement – occurring from 1 January 2026, for the activation of outplacement procedures and access to active labour market programmes aimed at redeployment.

This contribution is not payable in the event of termination of the employment relationship:

• for just cause (grave disciplinary reasons),
• for subjective justified reason,
• by mutual agreement, where at the date of termination the executive has reached the age of 64,
• for voluntary resignation.

Supplementary pension scheme – ‘Mario Negri’ Fund

For the duration of the renewal agreement, the Parties have strengthened supplementary pension measures for executives in the sector by adjusting both ordinary and additional contributions payable to the ‘Mario Negri’ supplementary pension fund.

Without prejudice to the ordinary contribution payable by the employer at a rate of 12.86 per cent of the conventional annual remuneration of EUR 59,224.54, with effect from 1 January 2026 the ordinary contribution payable by the executive increases from 1 to 2 per cent of that conventional annual remuneration. The amount of this annual contribution will therefore double, increasing from EUR 592.25 to EUR 1,184.49 per year.

With regard to the additional contribution, the Parties have also agreed on a further increase – in addition to that provided for by the previous renewal agreement – in the rate applied to the additional contribution payable by the employer over the 2026-2028 period, as follows:

2.52% with effect from 1 January 2026;
2.57% with effect from 1 January 2027;
2.62% with effect from 1 January 2028.

These increases were necessary in order to comply with the financial rebalancing plan of the Mario Negri Fund authorised by COVIP.

Illness and accident

As part of the strengthening of individual insurance benefits for welfare and social security, with effect from the contribution period relating to the fourth quarter of 2025 (October-November-December 2025), the Parties provide for an increase in the annual premium payable by the employer to the Antonio Pastore Association, from EUR 410 to EUR 560 per year for each insured executive. Accordingly, without prejudice to the deduction payable by the executive, the total contribution due to the Antonio Pastore Association will amount to EUR 5,321.26 per year for each executive.

The Parties also introduce changes to insurance coverage against non-occupational accidents. In particular, with effect from 1 January 2026, coverage under a non-occupational accident policy taken out by the employer with the Pastore Association will apply provided that the accident results in a condition of disability of at least 3 per cent, with a deductible of three percentage points where the certified disability exceeds 3 per cent and up to 10 per cent.

Contribution incentives

With regard to the contribution incentive for the recruitment or appointment of new executives in the sector, art. 7 of the Agreement specifies that reduced contribution duties constitute a temporary measure, applicable i) only once over the executive’s working career and ii) for a maximum of two years, extended to three years in the case of fixed-term contracts entered into as a measure to support active ageing, as examined below.

Active ageing

Art. 9 of the Agreement provides for a specific incentive measure aimed at encouraging senior-level generational turnover while at the same time maintaining employment stability for so-called senior executives.

With effect from 1 January 2026, executives whose age is up to three years below the statutory retirement age for old-age pensions (currently set at 67), whose employment relationship has ceased for any reason, may enter into a new fixed-term employment contract with the employer, including on a part-time basis, with the assignment of specific mentoring functions.

The conclusion of this individual contract – which in any event does not constitute an obligation on the employer – must take place at the territorial associations of Manageritalia or Confcommercio, which will certify its execution on pain of invalidity.

Following the conclusion of such a contract, the employer may benefit, once only for each contracted executive and for a maximum of three years, from the contractual contribution incentive referred to above, even where that incentive has already been used in previous employment relationships.

Where the fixed-term contract ends early, except in cases of just cause, the executive will be entitled to compensation equal to the monthly payments accruing from the date of termination to the contractually established end date. This compensation will be adjusted proportionally in the case of part-time employment.

Serious illness

As part of the protection of executives affected by serious illnesses, art. 13 of the Agreement incorporates the provisions recently introduced by Law No. 106 of 18 July 2025 in favour of workers affected by oncological, disabling and chronic illnesses. In particular, art. 1 of that legislative measure provides that, with effect from 9 August 2025, such workers may request a period of unpaid extraordinary leave, not counted for seniority of service or pension purposes, of up to 24 months, provided that they are affected by oncological, disabling or chronic illnesses, including rare conditions, which:

• entail a degree of disability equal to or exceeding 74 per cent,
• are certified by appropriate documentation issued by a general practitioner or specialist practising in a public or accredited private healthcare facility treating the worker.

Without prejudice to the executive’s right to job retention throughout the period of extraordinary leave, the employer is required to bear in full the overall contribution to the supplementary healthcare assistance fund FASDAC, set at 9.94% of the conventional annual remuneration of EUR 45,940 (art. 27 of the CCNL).

Equal opportunities and pay transparency

With the stated aim of implementing all measures necessary to eliminate any gender-based discrimination in career development and promotion plans for executives in the sector, the Parties agree to establish a national observatory for diversity, equity, inclusion and pay transparency. This body will be tasked with promoting, including through surveys, dedicated training activities and initiatives to balance work and family life.

According to CNEL’s statistical data, the NCBA was applied by 8,385 employers, governing the employment of 28,193 executives.

Although case law and judicial decisions on the replacement of human labour with AI are still at an embryonic stage (in practice, only three judgments have so far been identified that address, albeit incidentally, the use of AI), both the legislature and the social partners have begun to outline a reference framework.

Indeed, Law No. 132 of 23 September 2025 introduced specific provisions on artificial intelligence, including in the employment context. Art. 11 sets out the fundamental principles:

• AI must be used to improve working conditions, safeguard the workers’ psycho-physical integrity, and enhance the quality of performance and productivity,
• its use must be safe and transparent and must not infringe human dignity or privacy. An obligation is imposed on employers to inform workers about the use of AI systems,
• the use of AI for discriminatory purposes is prohibited.

National Collective Bargaining Agreements (NCBAs) have also begun to regulate the phenomenon. For example, the NCBA for employees of social cooperatives and the NCBA for the beauty sector both recognise AI as a key driver of change in the world of work. Both agreements highlight the dual nature of AI’s impact: ‘the use of AI as a resource entails the risk of replacing human resources in routine tasks, with potential negative effects on employment, although at present this impact is not fully quantifiable. On the other hand, the implementation of AI systems can increase organisational efficiency, […] support workers in performing tasks more quickly, reducing the risk of alienation in repetitive activities and allowing them to focus on aspects of work that require creativity and ingenuity’.

These NCBAs stress the need for a gradual integration of AI that keeps human resources at the centre of the organisation, regulating the human–machine relationship and investing in training and the reskilling of competences.

It is nonetheless clear that the use of artificial intelligence entails both risks and new opportunities for the labour market.

The most ‘feared’ risk is the replacement of human labour, especially in ‘routine tasks’ and ‘repetitive activities’. The judgment of the Court of Rome, although not deciding this point directly, offers a concrete example of how a role (graphic designer) can be absorbed by other managerial positions with the support of AI tools, which make it possible ‘to achieve economic savings and speed up the performance of work’.

At the same time, AI can also act as a support tool, freeing workers from low value-added tasks and allowing them to devote themselves to activities requiring creativity and ingenuity or critical thinking. The law itself promotes the use of AI aimed at enhancing the quality of work performance.

From this perspective, the integration of AI into work makes the continuous updating of skills indispensable.

As regards the impact on different professional profiles, it is fairly intuitive that AI will not have a uniform effect, but will affect roles differently depending on the content of the tasks performed.

As noted above, the roles most at risk are those whose activities are standardisable, repetitive or based on predefined rules. The case of the graphic designer in the judgment analysed is emblematic: her tasks, consisting in executing the creative ideas of others, were partially automated.

Other professional roles, by contrast, are likely to be transformed rather than replaced: for example, intellectual professions and highly specialised roles, for which AI will primarily function as a support tool. Article 13 of Law No. 132/2025 clarifies that, in these areas, AI must remain ancillary, with the primacy of human work preserved.

The judgment of the Court of Rome, while insisting on a specific case of dismissal for objective reasons, provides a realistic snapshot of how AI is already entering corporate processes as an efficiency-enhancing tool, with direct consequences for work organisation. The regulatory and collective bargaining framework currently taking shape seeks to govern this transition by balancing productivity needs with the protection of workers’ dignity and employability.

Other relevant decisions concerning the use of artificial intelligence include the following.

• The judgment of the Rome Court of Appeal, Decision No. 3372/2022, which, although predating the recent legislation on AI, is of particular significance because it analyses the fundamental principles governing the use of automated decision-making processes, drawing on the General Data Protection Regulation. The Court focuses on the risk of discriminatory processing resulting from a ‘blind reliance on the use of algorithms’ and identifies three core principles:
  i) the principle of knowability (transparency);
  ii) limits on fully automated decision-making and the need for human oversight;
  iii) the principle of imputability and responsibility.

• The decision of the Court of Milan, Judgment No. 1207/2025, offers a different perspective. According to this ruling, artificial intelligence is not a tool that replaces workers, but rather a business area, the abandonment of which may justify a corporate reorganisation with the consequent dismissal of employees. The case concerned the dismissal for objective reasons of a Chief Innovation Officer. The evidence showed that the company initially had expectations regarding innovative projects, including products based on artificial intelligence, which were subsequently abandoned. The Court held the dismissal to be lawful, recognising that the company had effectively eliminated the claimant’s position because it was no longer considered strategic. The decision to abandon AI-related projects formed an integral part of the organisational choice that rendered that specific professional role redundant. In summary, this judgment illustrates an indirect impact of AI on the employment relationship: conversely, therefore, the failure or change of a business strategy centred on artificial intelligence may constitute a valid economic and organisational reason underlying a dismissal for objective reasons, provided that the suppression of the position is genuine and that there is a causal link with the termination.

The overall picture that emerges shows that case law, although still developing in a fragmented and experimental manner, cannot avoid a structured confrontation with the use of artificial intelligence in workplace contexts. AI is no longer a merely futuristic phenomenon, but a variable already affecting work organisation, professional roles and, inevitably, decisions leading to termination of employment. Judges will therefore be required to engage with new legal categories – such as algorithmic transparency, human oversight and the imputability of automated decisions – and to reconsider traditional institutions of labour law, including objective grounds for dismissal, redeployment obligations (‘repêchage’) and the protection of professional skills, in light of human–machine interaction. In this process, the courts will be called upon to play a balancing role, ensuring that technological innovation develops in compliance with the dignity of workers and the centrality of human labour, preventing AI from becoming a tool for the dilution of responsibility or the covert erosion of employment protections.