On 22 January 2009 the Italian Government entered into a new national collective bargaining agreement with employer and union representatives, replacing the current tri-partite arrangements which have been in place since 1993. The new Agreement was entered into in response to calls for greater flexibility in light of the current economic crisis. It will cover all businesses, except for the banking sector which has refused to sign it. One of the major Italian unions (CGIL) has also refused to sign the Agreement, citing concerns that it will undermine workers’ rights.  

The new arrangements will change the duration of collective agreements. Currently the non-pay provisions of agreements are valid for four years and the pay provisions are valid for three years. Going forward both pay and non-pay provisions will be valid for three years.  

There will also be new arrangements governing how wage levels are set. Currently industry-wide agreements set out basic minimum rates and provide for general pay increases while company-level agreements provide for additional increases linked to company performance. The Government wants a greater role for company-level agreements. It has therefore been agreed that wage increases will be mainly linked to increases in labour productivity as per any rules set out in a company-level agreement.  

The index used for measuring inflation and thus calculating wage increases will also change. In future the parties will use the Eurostat index instead of the national consumer prices index.