Background information

Preceded by European Council Directive 80/987/EEC on the protection of employees in the event of the insolvency of their employer, Wage Guarantee Fund for labour related credits was established by Article 2, Law No. 297 of 29 May 1982, to guarantee severance payment in case of insolvent employer.

The aim is to protect the credit of employees whose employer is subject to insolvency or enforcement proceedings.

Content of measure

'Fondo di Garanzia’, administered by the National Institute of Social Security (Istituto Nazionale della Previdenza Sociale, INPS), pays unpaid remunerations related to the last three months of the employment contract as well as the severance indemnity (the so-called ‘Trattamento di Fine Rapporto’, TFR) to employees, apprentices, industrial firms’ management and members of cooperatives whose companies are unable to pay, since they are declared insolvent or part of an enforcement proceeding.

The conditions to apply for ‘Fondo di Garanzia’ are the termination of the employment relationship, the ascertainment of the worker’s credit by a court, the existence of insolvency or enforcement proceedings against the employer, and the employer’s state of insolvency. As for the last three wages, the maximum amount paid is equal to three times the amount of the ‘Cassa Integrazioni Guadagni’ (CIG) treatment, net of social security contributions. Interest and monetary adjustment are also added to the due sums.

‘Fondo di Garanzia’ intervenes even if the employer has failed to pay social contributions. Workers, in the event of insolvency proceedings, may request unpaid social security contributions to be considered as paid. Moreover, INPS intervenes also in case the employer fails to pay contributions to a supplementary pension fund.

‘Fondo di Garanzia’ is financed by employers’ contributions. Payments to workers are independent from whether or not employers have paid contributions.

Use of measure

In 2024, the maximum net monthly amount for CIG is the following:

Less than €1,425.21, the allowance will be 75% of the monthly salary. More than €1,425.21, the allowance will be 75% of €1,425.21 plus 25% of the excess amount, with a maximum limit of €1,550.42.

On 1 April 2022, the INPS announced to the public the new service for the transmission of telematic applications for intervention by the Guarantee Funds for severance pay and work credits and the Supplementary Pension Position Guarantee Fund.

Target groups

Workers	Businesses	Citizens
Employees in standard employment	Applies to all businesses	Does not apply to citizens

Actors and funding

Actors	Funding
National government Trade unions Employers' organisations	Employers organisation

Social partners

Social partners' role in designing the measure and form of involvement:

	Trade unions	Employers' organisations
Role	Unknown	Unknown
Form	Not applicable	Not applicable

Social partners' role in the implementation, monitoring and assessment phase:

• Unknown
• Main level of involvement: Unknown

Involvement

Unknown

Views and reactions

Unknown

Sources

• 03 April 2017: Guarantee fund for employee severance indemnity and work credits (www.inps.it)
• 01 April 2022: TFR guarantee fund: new electronic procedure (www.ipsoa.it)