Background information

Act no. 148/2015 (Jobs Act – unemployment scheme for temporary crisis, hereafter ‘JACT’) reformed the whole set of rules concerning income support measures for people in employment (unemployment benefits schemes in the form of short-time allowances). JACT abolished all previous norms and set up a consolidated text envisaging the possibility for companies to have access to the following tools:

• the Ordinary Wage Guarantee Fund (Cassa integrazione guadagni ordinaria, CIGO);
• the Extraordinary Wage Guarantee Fund (Cassa integrazione guadagni straordinaria, CIGS);
• the Derogation Wage Guarantee Fund (Cassa integrazione in deroga, CID)
• solidarity contracts;
• solidarity funds, among which the Wage Integration Fund (Fondo di Integrazione Salariale, FIS).

The Ordinary Wage Guarantee Fund (CIGO) is a wage guarantee instrument activated in case of suspension of, or reduction in, working activities due to temporary events that cannot be ascribed to the company.

The Extraordinary Wage Guarantee Fund (CIGS) is a wage guarantee instrument authorised by the Ministry of Labour and Social Policies and available to companies staffed with more than 15 employees (or 50 employees in case of commercial businesses).

Solidarity contracts are wage guarantee instruments activated through agreements concluded by union associations and employer organisations.

Content of measure

The maximum duration of CIGO is 13 weeks, which can be extended up to 52 weeks. Decree law No. 18/2020 of 17 March 2020 has extended the use of CIGO for workers temporarily suspended from work due to the COVID-19 crisis for 14 weeks.

CIGS can be activated under the following conditions:

• business restructuring for a maximum period of 24 months (not necessarily consecutive) over a five-year period (to be counted from the date when such payment begins);
• business crisis for a maximum of 12 months;
• solidarity contracts for a maximum time span of 24 months (not necessarily consecutive), which can be extended up to 36 months.

The aim of a solidarity contract is to avoid, in whole or in part, staff reductions through a reduction in employees’ working hours. Today there are basically three types of solidarity funds:

• Bilateral solidarity funds: instituted according to decree law 148/2015 in all those sectors not covered by other wage guarantee funds (CIGO and CIGS);
• Alternative bilateral solidarity funds: they apply to the craft and temporary agency work sectors, where bilateral wage guarantee schemes were already operating before 2015;
• Wage integration fund (Fondo di integrazione salariale, FIS): managed by the National Institute of Social Security (INPS) for all those companies staffed with more than 5 employees which are not covered by other wage guarantee funds (CIGO, bilateral solidarity funds or alternative bilateral solidarity funds).

Use of measure

The number of hours authorized in May 2020, considering only the authorizations for the health emergency, amounted to 849.2 million (in line with what was already authorized in April 2020, i.e. 832.4 million). For the sake of comparison, the annual number of authorised hours in the worst year after the financial crisis, in 2010, was 1,198.5 million.

These instruments have the strength of keeping workers in employment in times of crisis, reducing the number of dismissals.

During the COVID-19 pandemic, particular weaknesses have been highlighted concerning the payment of CID, which experienced serious delays and left a significant number of workers without income.

The Observatory on Authorised Hours of Wage Guarantee Fund released data for May 2024. Key points:

• 47.2 million hours authorised, up from 38.1 million in April
• CIGO: 26.3 million hours, a 5.7% increase from April (24.9 million)
• CIGS: 20 million hours (7.8 million for solidarity), compared to 11.7 million in April and 14 million in May 2023.
• FIS:The number of hours authorized in May 2024 in solidarity funds is equal to 0.8 million and records an increase of +8.5% compared to the previous month.

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 Public employment service	Companies Employees Employer National funds

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:

• Social partners jointly
• Main level of involvement: Sectoral or branch level

Involvement

Collective bargaining agreements concluded between union associations and employer organisations are implemented in those sectors not covered by CIGO and CIGS to protect and guarantee income through the Solidarity Fund.

Views and reactions

Unknown

Sources

• 19 December 1984: Solidarity contracts (www.wikilabour.it)
• 03 April 2017: Ordinary redundancy fund (www.lavoro.gov.it)
• 03 April 2017: Extraordinary redundancy fund (www.lavoro.gov.it)
• 03 April 2017: Solidarity funds (www.lavoro.gov.it)
• 03 April 2017: Salary Integration Fund (FIS) (www.inps.it)
• 17 March 2020: Misure di potenziamento del Servizio sanitario nazionale e di sostegno economico per famiglie, lavoratori e imprese connesse all'emergenza epidemiologica da COVID-19. (www.lavoro.gov.it)
• 27 June 2024: CIG Observatory: May 2024 data (www.inps.it)