Social Security - Eligibility & Exemptions
Generally if you work for an employer in Italy, you’re insured under Italian social security legislation and won’t have any liability for social security contributions in your home country or country of domicile. Italy has reciprocal social security agreements with some 40 countries (including all EU countries, Canada and the US) whereby expatriates may remain under their home country’s social security scheme for a limited period. Agreements normally apply for a maximum of two years and may usually be extended for up to five years. For example, under an agreement between the US and Italy, an American employee of a US company who is transferred to Italy for up to five years can continue to pay US social security contributions. Similarly, EU nationals transferred to Italy by an employer in their home country can continue to pay social security abroad for one year, which can be extended for another year in unforeseen circumstances. This also applies to the self-employed. However, after working in Italy for two years, EU nationals must contribute to Italian social security.
If you or your spouse work in Italy but remain insured under the social security legislation of another EU country, you’re able to claim social security benefits from that country and your foreign contributions are taken into account when calculating your qualification for benefits. This is particularly important with regard to state pensions. Contact your country’s social security administration for information. In Britain information is provided in two booklets, Social Security For Migrant Workers and Your Social Security, Health Care And Pension Rights In The European Community (SA29), both of which are available from the Department of Social Security, Contributions Agency, Newcastle-upon-Tyne NE98 1YX, UK (0191-213 5000).
Benefits are detailed below. In many cases there are different regulations and payments for workers (operai), salaried staff (impiegati) and managers (dirigenti).
Sickness benefit (indennità di malattia) is payable for an illness or accident that results in an absence from work of at least seven days and is paid for a maximum of 180 days. The amount payable is calculated from your average daily earnings during the month preceding your illness and is equal to around 50 per cent of your earnings for the first 21 days and two-thirds of earnings for the remaining days. However, if you’re hospitalised and don’t have any dependants, the benefit is equal to 40 per cent of your average earnings. If you have an accident at work, you receive full pay during the recovery period; if an injury prevents you from working permanently, you receive an invalid pension. Sickness benefit is generally paid by the employer, who recovers the payment from the INPS, but in certain cases is paid directly by INPS. Sickness benefit doesn’t apply to the self-employed.
Italian maternity benefit (per maternità) is among the most generous in the world and is equal to 80 per cent of your salary, which is paid for a total of five months before and immediately following a birth. Mothers are also entitled to receive a reduced benefit of 30 per cent of their salary for six months (called congedo facoltativo) during the year following the birth. An application for maternity benefits must be made at your local INPS office; you require a medical certificate (certificato medico) confirming your pregnancy and a statement from your employer certifying that you’ve stopped work due to pregnancy. After the birth you must provide the INPS with a copy of the birth certificate (certificato di nascita) and a certificate of family status (certificato di stato di famiglia), available from the registry office (Ufficio Anagrafe) in your comune.
All workers and many other employees are covered against work-related illnesses (e.g. occupational diseases) and accidents. Disability benefits (indennità di inabilità)include salary for temporary disability and pensions for permanent disability. Temporary disability benefit is 60 per cent of your average daily wage during the two weeks preceding the accident or onset of illness. Permanent disability benefits vary according to the seriousness of the disability and may take the form of a lump sum payment (for minor disability) or an annuity (for major disability). Those who are totally disabled also qualify for a ‘constant attendance supplement’ of €369.40 per month. Disability benefits don’t apply to the self-employed. For details of permanent disability benefit, see State Pensions on page 279.
If you’re an employee and the only wage earner in your family, you can apply for family allowance (assegno familiare) if your salary falls below a certain level, which varies according to the number of people in the family. Levels change regularly and up-to-date figures can be found on the website of the Istituto Nazionale della Previdenza Sociale(: www.inps.it). Family allowance in 2002 was between €771 and €932 per month, depending on family size and circumstances. An application form is available from your employer or an INPS office and must be accompanied by a certificate of family status (certificato di stato di famiglia). The form is given to your employer who pays the allowance with your salary.
There are various kinds of unemployment benefit (indennità di disoccupazione), as detailed below.
- Ordinary Benefit – To qualify for ordinary benefit (indennità ordinaria), you must have worked for at least a year and contributed for at least the previous two years. Benefit is available for a maximum of 180 days (six months) and is paid from the eighth day after termination of work, provided that an application is made within the first seven days. However, applications can be made up to 90 days after ceasing work. Benefit is calculated at 30 per cent of your average earnings during the previous three months, but cannot exceed a certain maximum, which was €932.82 per month in 2002.
- Reduced Benefit – If you’ve worked for at least 78 days in the previous year (including public holidays) but less than a year in total, or have made two years’ voluntary contributions, you qualify for reduced benefit (indennità ridotta). Benefit is calculated at 30 per cent of your average net earnings during the previous three months, but the entire amount received, which is paid as a lump sum, cannot exceed €932.82.
- Special Allowance – A special allowance (trattamento speciale) is awarded to employees who have been made redundant in the agriculture and construction industries, and is currently a maximum of around €20 per day. Contributions paid in other EU member states are taken into account when making an application for benefit.
An application for unemployment benefit must be made at your local INPS office or the employment office (Ufficio di Collocamento) with your notice of dismissal and a certificate of family status (certificato di stato di famiglia – see Parental Leave on page 61). You’re issued with an unemployment registration card (attestato di iscrizione). If you’re unemployed in another EU country, you retain the right to your unemployment benefit (under certain conditions) for up to three months while looking for work in Italy. The country paying your employment benefit issues you with form E303, which you must take to an INPS office in Italy. If you return home before the end of the three months, you continue to receive your unemployment benefit in your home country. The self-employed and those who have never worked in Italy or resign from their job don’t qualify for unemployment benefit.
In addition to unemployment benefits, Italy has a state fund for employees in industry whose companies put them on temporary redundancy through no fault of their own (e.g. market crisis, natural disaster, etc.), called Cassa Integrazione Guadagni (CIG), which is designed to ‘integrate’ employees’ earnings until work is resumed. There are two types of CIG:
- Ordinary CIG comprises 80 per cent of your salary for hours not worked, e.g. if an employer agrees to provide five hours’ work in a 35-hour week, 80 per cent of the salary for the remaining 30 hours is remunerated. This cannot exceed a monthly maximum, which in 2002 was €776.12 per month, or €932.82 per month if monthly income exceeded €1,679.07.
- Extraordinary CIG, which is designed to cover special situations, e.g. when a production line is being reorganised or converted and work must temporarily cease, lasts for 36 months in cases of reorganisation or conversion and 12 months in cases of company crisis. Benefit is the same as for ordinary CIG above.
In both cases, if the market hasn’t changed, companies aren’t obliged to take back employees, so CIG often becomes the start of unemployment benefit.
This excerpt has been republished with permission from Survival Books. Some of the information may apply to EU citizens only. If you would like to get the inside track on moving to Italy, pick up your copy of this great book by clicking here.