The Italian Social Security Institute (INPS) issued Circular no. 90 of 12 May 2025 setting out the operational guidelines for the contribution relief (sgravio contributivo) granted under the so-called Cohesion Decree for hiring young workers under 35. It also launched the website where such applications can be made.
The relief is for hires on open-ended contracts or conversions to open-ended contracts made between 1 September 2024 and 31 December 2025. To qualify, an employee must never have had an open-ended employment contract, either with the current employer or any previous one, in Italy or abroad.
The relief consists of a full exemption from social security contributions payable by the employer, up to a maximum of €500 per month per employee, for a maximum period of 24 months.
Specific rules apply to new hires at workplaces located in southern Italy (Abruzzo, Molise, Campania, Basilicata, Sicily, Apulia, Calabria, and Sardinia.) For these cases, if the hiring or conversion takes place between 31 January 2025 and 31 December 2025, the social security contribution relief can be up to €650 per month. The incentive for southern Italy is subject to State aid rules and has been approved by the European Commission. The benefit is granted only if, within 12 months of hiring, there is a net increase in employment compared to the previous period. Should no such increase occur, the relief has to be repaid.
This incentive does not apply to executives, apprentices or domestic workers.
Crucially, the exemption is forfeited if, in the six months prior to the incentivised hire, the employer has carried out individual dismissals for objective justified reason or collective redundancies within the same operational unit. Moreover, in the six months following the hire, the employer must not dismiss the newly hired employee or any other employee with the same job classification at the same workplace for objective justified reason.
Exceptions apply in cases of supervening incapacity for work or where the employee has exceeded the period of protected sick leave under Italian law (periodo di comporto).
Finally, the exemption is not compatible with other contribution relief schemes such as the Decontribuzione Sud or incentives for disadvantaged women, disabled workers or recipients of the NASpI unemployment benefit.
However, it is compatible with other forms of relief, including the “maxi-deduction” on labour costs, the exemption available to companies with gender equality certification and the contribution reduction for working mothers.
The exemption is granted within the limits of available funding. Therefore, where eligible, employers are advised to submit the relevant application to INPS as early as possible. The relief is subject to compliance with all applicable eligibility criteria
