Spotlight on Italy – A guide to implementing employee benefits technology 

Italy is a complicated location for reward leaders who aren’t familiar with the region as there are lots of local nuances based on job grades and collective agreements.  

Employee benefits in Italy vary significantly, depending on the industry sector of the company and the associated Collective Bargaining Agreements (CBA) that apply. In addition, they are then influenced by the employee’s gender, age, grade and location.   

There are two main industry sectors that form the basis of these CBAs: 

1. Manufacturing – including pharmaceuticals.  
2. Commerce – including professional services, finance and the tech sector.   

Employees typically fall into one of the following four categories: 

• Operaio – Blue collar workers 

• Impiegato – White collar workers 

• Quadro – Middle managers 

• Dirigente – Executives 

Depending on the employees’ employment grade, benefits will vary, and these are stipulated by the CBA that applies to each organisation. To help you better understand the benefits landscape in Italy, here’s an overview of mandatory, core and other popular benefits. 

Given the complexities involved, this spotlight focuses on Executives in the Commerce sector as an example to streamline the information provided.  

Mandatory benefits   

Employers are required to provide several mandatory benefits. However, due to the complex nature of the Italian system, this will vary according to industry sector, location, employment grade and the work agreement that is in place.  

Retirement 

Both employers and employees contribute to a mandatory pension plan. Executives are enrolled into the Mario Negri fund. Employers contribute 15.29% of the employee’s salary towards retirement, death and disability benefits, and employees contribute 1%, with an annual maximum of €59,224.54.  

Life, accident and disability  

For life, death and disability benefits, Executives are enrolled into a fund called Fondo Antonio Pastore. This provides cover for life insurance, accident, disability, and the level of coverage depends on the age and gender of the employee.  

However, middle managers do not have any mandatory requirements for life, accident and disability benefits, but the company typically provides cover under an insurance plan. 

Additionally, all employees have access to the national health system via their social security contributions. 

Core benefits 

In addition to the above mandatory benefits, work agreements specify the other benefits and levels of cover or contributions that need to be put in place for employees. We typically see Italian employers offering the following plans: 

Medical insurance plan 

Although cover may vary between employee grades, dental and vision are usually included within the medical plan. Most employers also provide a plan or contribution via an industry sector fund. Dependants are either paid for fully by employers, or employees can contribute a percentage if they wish.  

Executives and their family must be added to the FASDAC fund, whereas middle managers enter the QUAS fund. Both provide medical reimbursement up to the set limits of that particular fund. 

Life insurance, accident and disability 

Employers typically cover the full cost of this benefit and may use an insurance company or specific industry sector fund as the means to do this. This may also include cover for accidental death, permanent disability, personal accident, long term care and unemployment cover. 

Where cover is not mandatory by way of the CBA, many multinational companies will provide cover typically at two to three times the employees’ annual salary. 

Other popular benefits  

In addition to the above core and mandatory benefits, employers usually offer a number of additional benefits. 

Lunch vouchers  

These are very common and come in the form of a rechargeable electronic card. This can be used at cafes and restaurants, as well as supermarkets, to offer employees more flexibility and choice. Employees using electronic cards are entitled to up to €8 per day that they work, while this limit is capped at €4 for paper vouchers, to be non-taxable. 

Allowances and discount portals 

Wellbeing allowances are rapidly replacing gym discounts and memberships, as they can be spent across a wider range of physical activities, including more wellness focussed exercises like yoga or relaxation classes. 

Commuter allowances are provided by almost all employers to help with public transport costs.  

Employee discount portals are also popular, allowing employees to save on everyday shopping. 

Wellbeing programmes 

Other wellbeing assistance such as financial wellbeing/planning is becoming more prevalent. With demand from companies in this area growing, the local market is starting to develop offerings tailored to companies that want to support their employees. These services offer immediate counselling support, health and life coaching, legal and financial guidance, as well as medical advice and support by clinicians.  

Key considerations for implementing employee benefits in Italy 

1. Clear eligibility criteria help employees see relevant benefits and coverage levels that are personally tailored to them. This not only guides employees accurately through their available options, but also clarifies their entitled cover levels. Typically, it also highlights any taxable benefits (which varies by job grade).

2. Flex funds are becoming more popular. The use of a flex fund for employees to spend on increased medical cover, the addition of dependents to their plan, and supplementary pension contributions is increasing. This is part of the strategy shift many organisations are making towards a more relevant and personalised benefits offering.

3. As demand continues to grow, flexible benefits options are increasing. We are starting to see flexible benefits options growing (in conjunction with a fund) as companies begin to consider what employees really want from their benefits. Currently, employers are offering vouchers for childcare, shopping, fuel, leisure (theatre, cinema, amusement park tickets), travel, and training courses, such as learning a new language.

To learn more about how to navigate the complexities of the Italian employee benefits landscape, or for help prioritising your global rollout, speak to one of our benefits experts.