Payroll in Italy

Thinking about hiring in Italy? To stay compliant and keep things running smoothly, you’ll need to understand the local rules around HR, payroll, social security, and taxes. Discover the key information laid out for you below.

HR and labor laws in Italy

When you’re hiring in Italy, it’s crucial to understand local labor laws. From contracts and working hours to leave entitlements and dismissal procedures, here’s what you should know about specific laws in Italy.

Employment contracts

Italy offers several types of employment contracts, including permanent, temporary, and part-time agreements.

Probation period

The probation period typically ranges from 3 to 6 months, depending on the role and industry.

Termination

Employees are protected against unfair dismissal. Employers must follow specific procedures and provide valid reasons for termination.

Payroll management

Paying your team right means following the local payroll laws and protecting your business from fines or legal issues. Here are the payroll essentials in Italy:

Minimum wage

Italy does not have a statutory national minimum wage. Instead, minimum wages are usually set through collective labor agreements by sector.

Pay frequency

Salaries are generally paid on a monthly basis.

Overtime

Overtime work must be compensated at a higher rate, often defined in the applicable collective labor agreement.

Social security in Italy

The social security system in Italy acts as a safety net for your employees, offering protection in key moments throughout their careers and lives. It’s designed to provide financial support during live events like illness, maternity, unemployment or retirement. Discover how the social security system works in Italy:

INPS (Istituto Nazionale della Previdenza Sociale)

This is the main social security institution in Italy, handling pensions, unemployment benefits, and other social programs.

Coverage

Both employers and employees contribute to the social security system. Contribution rates vary based on the type of work and industry.

Workplace protections

Creating a fair and safe workplace matters. These laws help protect your employees in Italy:

Parental leave

Both mothers and fathers are entitled to parental leave, with specific rights and duration depending on individual circumstances.

Sick leave

Employees are entitled to sick leave. The duration and compensation depend on the collective labor agreement and the employee’s length of service.

Tax regulations in Italy

Taxes canbe tricky. Understanding how the system works in Italy, helps you avoid surprises and stay compliant. Here are some tax basics to keep in mind:

Income tax

Italy uses a progressive income tax system with multiple brackets based on earnings.

Value-added tax (VAT)

The standard value-added tax rate is 22%, with reduced rates for specific goods and services.

Paybix helps you managing your payroll in Italy

Running global payroll takes local knowhow. With Paybix, you’ll get expert support, tailored to each country your business in situated in. Thanks to our unified and digital platform, you gather clear insight in labor costs and cross-country payroll. You benefit from a 30% more efficient payroll process, including global reporting and core HR data management. Hassle-free, user-friendly and easy integrated with local payroll providers.

To ensurefull compliance with the latest regulations, Paybix consults with local legal partners and payroll providers. Get in touch with our experts. We provide you with accurate and up-to-date information.

Ready to optimize your payroll processes? Contact us. Book your free and personalised demo. Discover our data-driven solutions for your business success.

Become a partner

Become a Paybix partner and expand your business without major investment.

Want to schedule a demo?

Get an in-depth look into all our features.

Discover the latest updates from Paybix

Releases

Jun 25 🪴 Epix Product 🚀

We're excited to share the achievements of our development team from last month. Curious about the latest features and what's on the horizon? Keep reading! 🌞
Blog

What would the ideal world of a global payroll professional look like?

What drives a global payroll professional — and what would their ideal world look like? This blog explores how the role can evolve from operational burden to strategic, fulfilling career through smarter tools, digital processes, and a fresh perspective.
Releases

May 25 🦜️ Epix Product 🚀

We're excited to share the achievements of our development team from last month. Curious about the latest features and what's on the horizon? Keep reading! 🌞