The Cohesion Policy Decree-Law (Decree-Law no. 60/2024) introduced a total exemption from social security contributions for employers who hire young people under the age of 35 between 1 September 2024 and 31 December 2025.
However, these measures will only come into effect once they have been approved by the European Commission. It is therefore crucial to note that all new hires must initially be treated as ‘standard’ hires, with no immediate application of the relief. Only after the Commission’s approval and the publication of operational guidelines by the Italian Social Security Institute (INPS) will employers be able to reclaim social security contributions already paid.
Here is a summary of this contribution relief:
| UNDER 35 BONUS | Features |
|---|---|
| Benefit Period | 1 September 2024 to 31 December 2025 |
| Type of Employee | Young people under the age of 35 (up to 34 years and 364 days) who have never had an open-ended contract of employment (excluding apprenticeship contracts where the qualification was not completed). If the young person previously had an open-ended employment contract for which the employer benefited partially from the youth bonus, the new employer can only benefit from the contribution exemption for the remaining usable period. |
| Contract Type | – Open-ended employment contract – Change a fixed-term contract, into an open-ended one |
| Facility | Exemption from paying 100% of social security contributions payable by the employer, excluding National Insurance Institute for Industrial Accidents (INAIL) contributions and premiums, with a monthly cap of €500 per employee. The rate used to calculate pension benefits remains unchanged. This limit is increased to €650 per month if the young person is hired in an office or production unit located in one of the following regions: Abruzzo, Molise, Campania, Basilicata, Sicily, Apulia, Calabria or Sardinia (ZES Sud – Single Special Economic Zone for the South). |
| Duration of the Facility | 24 months |
| Restrictions | – The employer must not have made any collective or individual dismissals for economical reasons in the six months prior to the incentivised hiring in the same production unit in which the young person is being hired. – In the six months following the incentivised hiring, the employer may not, for economical reasons, dismiss the newly hired young worker in the same production unit, nor dismiss any other workers with the same qualifications as the newly hired young worker. – Failure to comply with these restrictions will result in revocation of the incentive and recovery of any benefits already received. |
| Exclusions | The following cannot be hired on the incentives in question: – Domestic workers – Executive personnel – Apprenticeship contracts |
| Limits | The exemption has the following limits: – n- The spending limits authorised by law (€34.4 million for 2024, €458.3 million for 2025, €682.5 million for 2026 and €254.1 million for 2027). INPS is delegated to monitor compliance with these spending limits;. – Compliance with the procedures, territorial limits and eligibility criteria set out in the National Programme for Youth, Women and Work 2021-2027. – The exemption cannot be combined with other exemptions and/or employer contribution reductions. It may be combined with the “super deduction” provided for in Article 4 of Legislative Decree no. 216/2023 |
| Operational Requirements | For the measure to come into effect, the following must happen: – The European Commission must grant authorisation. – INPS must issue an operational circular |
