Employment and labour

Employee transfers

What rules, obligations and liabilities apply to the transfer of employees to and from the customer and supplier (including with regard to offshoring arrangements and termination of the outsourcing contract)?

The main rules that apply to the transfer of employees to and from customers and suppliers are set out in:

  • Legislative Decree 276/2003;
  • Law 99/2013;
  • Legislative Decree 81/2005, concerning temporary employment agency work contracts and Law 1369/1960, on the prohibition of interposition and intermediation of manpower; and
  • Legislative Decree 8/2016, concerning criminal liability for abusive temporary employment agency work contracts.

Liability concerns apply, particularly the abusive use of temporary employment agency work contracts, such as where temporary employment agency work contracts are relied on instead of standard employment agreements for fiscal and/or economic benefit (eg, to avoid having to hire employees).

Obligations and liability depend on the configuration of the contracts, particularly temporary employment agency work contracts (Article 30 of Legislative Decree 81/2015) and employment or service agreements (Articles 1655 et seq the Civil Code). The ‘contratto d’appalto’ framework can be used only if a company:

  • is responsible for its own risk management;
  • uses its own organisation (in terms of personnel and infrastructure); and
  • has an effective power to issue directives and instructions to workers.

Service agreements must fulfil one of a number of criteria in order to be classified as an ‘appalto’, as highlighted by the Consiglio di Stato, such as the requirement for a certain number of hours of work or for a worker to have been placed in an organisation in a stable manner. Where a fraudulent service agreement is entered into, criminal penalties are defined by Article 18 of Legislative Decree 276/2003. At the end of the outsourcing period, hired workers should not be terminated unless there are conditions for dismissal with objective and just cause. Article 2112 of the Civil Code establishes that, in case of transfer of a company branch, employees will retain their rights under employment law; however, outsourcing is sometimes unlawfully relied on in practice as a covert pretext to dismiss employees.

Definition of ‘employer’

How is ‘employer’ defined in the context of an outsourcing arrangement, and how does this affect the parties’ responsibilities and liabilities?

Italian law defines these workers as ‘interinali’. In this case, the formal employer for the work is not their effective employer. An interinale agency will hire these employees and comply with their corresponding salary and tax/duty payment obligations. As such, the agency remains responsible for these obligations, even if these employees actually perform work for another person or company.

Organised labour issues

To what extent are labour unions and works councils involved in outsourcing arrangements?

In certain cases (depending on the number of employees involved in a company), trade union agreements are put in place before an outsourcing project, with trade unions acting as a mouthpiece for employees’ rights, in order to handle concerns about potential termination or dismissal of employees.

Immigration

What immigration schemes and rules are pertinent in the context of outsourcing arrangements?

The rules on the so-called ‘distacco’ of employees (ie, the transfer of employees from one branch to another) and on transfers of company branches (as employees may also be transferred to other companies in this manner).