The measures introduced by the Italian government to support families

December 30, 2020

To deal with the Covid-19 emergency, the Italian Government has introduced a series of measures to support Italian families, starting from the ‘Cure Italy Decree’; these measures were then subsequently strengthened and extended by the 'Relaunch Decree’ and the ‘August Decree’: measures to support working parents, measures to ensure the necessary levels of liquidity by guaranteeing income and the suspension of tax and social security contributions, indemnities and new schemes such as ‘Emergency Income’ for the families most in difficulty and significant allocations to extend social protection schemes. The Relaunch Decree also definitively cancelled the so-called 'safeguard clauses’, eliminating the increases in VAT and excise duties that had been planned from 2021, thereby benefiting the country's economy and families.

Please find below the main measures introduced to support families.

Support for working parents

Bonus for babysitting services: the Cure Italy Decree introduced a voucher to purchase babysitting services, for up to a maximum of € 600, to be used for services provided in 2020, starting from 5 March. The Relaunch Decree increased this voucher from € 600 to € 1,200 (as it can be used over 2 months), also making it available for enrolment in summer camps; this initiative was strengthened after the ‘Family policies fund’ was refinanced by € 150 million. For health sector employees, this bonus was increased from € 1,000 to € 2,000 (as it can be used over 2 months), with approximately € 680 million being set aside.
Parental leave: for parents who are private-sector employees, the Cure Italy Decree introduced the right to specific parental leave for children under the age of 12, granting an allowance equal to 50 per cent of their salary. Setting aside a total of € 660 million, the Relaunch Decree extended the duration of this leave from fifteen days to a total of thirty days, to be taken on a continuous basis or divided up, while the period to make use of this leave was also extended from 3 May until 31 July 2020.
Smart working: until the end of the COVID-19 emergency, parents employed in the private sector with at least one child under the age of 14 have the right to work from home, even without an individual agreement to do so, provided that there is no other parent in the household benefiting from income support schemes should their work have been suspended or terminated, and as long as the other parent is working. All public-sector employers can opt for smart working for all their employees until the end of the state of emergency and, in any case, up until 31 December 2020.
Support for schools: the August Decree set aside € 1 billion for the upcoming two-year period, in order to increase the resources available to the fund dedicated to school building requirements and adapting educational activities for the 2020-2021 academic year, in order to make them safe and to hire new teachers (these resources had already been strengthened by the Relaunch Decree).
The Cure Italy Decree set aside an extra € 85 million for the ‘Fund for digital innovation and teaching workshops’, dedicating resources to the purchase of digital platforms and tools for state schools (€ 10 million), to loaning personal digital devices to less well-off students (€ 70 million) and to staff training. A "Fund for the COVID-19 epidemiological emergency” has also been established, setting aside € 400 million in 2020 and € 600 million in 2021 for the implementation of measures to contain the epidemiological risk.

Social safeguards

Paid leave pursuant to Italian law no. 104 strengthened: The Cure Italy Decree provided for an additional twelve days of the paid leave granted by current legislation to assist disabled family members and covered by social security contributions (so-called "paid leave pursuant to Italian Law 104/92”). These additional twelve days of leave, available in March and April 2020, were added to the three days of monthly leave already provided for by law, for a total of eighteen days for the two months mentioned. For healthcare workers, this benefit was granted in line with the organisational needs of the national health service companies and organisations involved in the COVID-19 emergency and of the health sector. The Relaunch Decree confirmed the same measure for the months of May and June 2020, setting aside a total of € 800 million.
Increased funds for disability assistance and services: the Relaunch Decree set aside a total of € 150 million to strengthen assistance, services and independent living projects for people with very serious disabilities and people who are not self-sufficient, as well as to support their carers, following the Covid-19 epidemiological emergency.
Emergency Income for families with disabled members: the Relaunch Decree introduced this form of extraordinary support for families in difficulty due to the Covid-19 emergency, setting aside € 1 billion; the Emergency Income will be paid in two instalments, each with a value of between € 400 and € 800 (€ 840 for families with severely disabled members or members who are not self-sufficient).
Education for disabled students: the Relaunch Decree allocated € 331 million to the fund for the proper functioning of schools, ensuring that they can reopen safely and that the 2020/2021 academic year can go ahead appropriately, in line with the requirements of the epidemiological situation; this amount also includes resources dedicated to teaching disabled students and students with specific learning disorders and other special educational needs.

Tax subsidies

Suspended payments: through the Cure Italy Decree and the subsequent 'Liquidity Decree’, the Italian government suspended a wide range of withholding tax, taxes and contributions, deferring deadlines and suspending tax and contribution payments. The Relaunch Decree further extended the suspension of the payments due in March, April and May until September 2020, and introduced additional tax measures, aimed at supporting entrepreneurial activity on the one hand, and at reducing costs for protective equipment and for the sanitisation and adaptation of work environments and commercial premises on the other.
VAT and excise duty 'safeguard clauses’ abolished: the Relaunch Decree definitively abolished the so-called ‘safeguard clauses', starting from 1 January 2021, which would otherwise automatically increase VAT rates and excise duties on certain fuel products.
Seizures suspended on salaries and pensions: seizures on salaries, wages and pensions carried out by collection agents were suspended until 31 August 2020, with a measure introduced by the Relaunch Decree. Up until the same date, these sums are not subject to the availability restriction and the garnishee may make them available to the debtor who is subject to enforcement, even if the enforcement court has already ordered the relative allocation.
Holiday tax credit: the Relaunch Decree introduced a tax credit for families with an ISEE income of up to € 40,000, to pay for services offered by tourist accommodation companies. This tax credit, which can only be used once per family, amounted to € 500 for each family, € 300 for families made up of two people and € 150 for one-person households.
A 110% ‘ecobonus’ and ‘earthquake bonus’: the Relaunch Decree introduced a 110% tax deduction for costs incurred to improve energy performance and/or earthquake protection work, with the possibility of transferring the relative tax credit. This applies to expenses incurred from 1 July 2020 to 31 December 2021 for thermal insulation work and other measures to improve energy efficiency. Any work to reduce the earthquake risk is also included (‘earthquake bonus’) as is work to install photovoltaic systems and columns to charge electric vehicles.

Income protection

The ‘Gasparrini Fund’ for first-home mortgages: the Cure Italy Decree introduced a nine-month extension to the solidarity fund made available for the first-home mortgages of self-employed workers and freelancers who have suffered a decline in turnover of over 33 per cent compared with the last quarter of 2019, following the closure or restriction of their business as a result of measures being adopted for the coronavirus emergency.
Suspension of dismissal procedures: employers that have not fully benefited from the special Covid fund to supplement earnings, or from the social security contribution exemption, are precluded from starting individual dismissal procedures, and those initiated after 23 February 2020 will remain suspended, as stated by the Cure Italy Decree and subsequently confirmed and extended by the Relaunch Decree. Collective dismissal procedures shall nonetheless remain suspended. These suspensions do not apply in the event of dismissals caused by companies definitively ceasing to operate.
Exceptional fund to supplement earnings: The Cure Italy Decree extended the ‘Cassa integrazione in deroga’ (exceptional fund to supplement earnings) throughout Italy, for all employees, in all production sectors, setting aside a total of € 4 billion. For employers (including companies with fewer than five employees) that have had to suspend or reduce their activity due to the epidemiological emergency, it is possible to resort to the exceptional ‘Cassa Integrazione’ fund to supplement earnings, on the new grounds of "Covid-19", for a maximum duration of 9 weeks. This possibility has also been extended to companies that already benefit from the non-standard ‘Cassa Integrazione’. After the first 9-week extension granted by the Relaunch Decree, the August Decree then strengthened the schemes to supplement earnings as well as the ‘Solidarity Fund’ for an additional 18 weeks.
Changes to exceptional earnings supplement payments: to avoid delays in payment of the ‘Cassa integrazione in deroga’ (exceptional fund to supplement earnings), the Relaunch Decree also allowed companies with under five employees to apply directly to INPS (Italian National Institute of Social Security). Employers who opt to receive a direct payment from INPS must submit their application together with the key figures required for the relative calculation, paying an advance on the benefit to workers. INPS then authorises the applications and arranges the advance payment of the benefit within 15 days from receiving said applications. The size of the advance is calculated based on 40% of the authorised hours for the entire period. Once the employers send INPS the full set of their data, INPS pays the residual benefit amount or collects any excess advance payments from employers.
Extension of access to the standard allowance: the Cure Italy Decree introduced the possibility for employers to apply for the standard allowance stating "emergency COVID-19” as the reason, starting from 23 February 2020 and for a maximum duration of nine weeks (in any case by August 2020).
NASPI and DISCOLL: the August Decree extended standard unemployment benefits (NASPI) and unemployment benefits for Co.Co.Co. (freelance work contracts coordinated by an employer) (DISCOLL), that would otherwise have expired between 1 May 2020 and 30 June 2020, for an additional two months, provided that recipients have not also received the € 600 indemnity introduced by the Cure Italy Decree and the Relaunch Decree. The amount paid for each additional month is the same as the last month of the original benefit.
Indemnities: the Italian government's measures have introduced a number of indemnities, which cannot be combined with pensions or salaries. In particular:
- The August Decree introduced new allowances for specific categories of workers: an indemnity of € 1,000 has been introduced for seasonal workers in the tourism, spa and entertainment industries, who have been badly affected by the epidemiological emergency, and to other categories of workers, including members of the ‘entertainment workers' pension fund’ who meet certain requirements, seasonal employees other than those working in tourist and spa establishments, intermittent workers and door-to-door sales people. In addition, a € 600 indemnity is available for seafarers and seasonal sports workers. The indemnity for self-employed workers and professionals registered with compulsory private pension providers will automatically be paid also for the month of May 2020 and will be increased to € 1,000.
- The Cure Italy Decree also introduced an indemnity of € 600 for almost 5 million people: professionals not enrolled with official registers, people working under a “co.co.co.” agreement (freelance work contracts coordinated by an employer) with a separate national insurance and pension scheme, artisans, traders, farmers and sharecroppers, seasonal workers in tourism and spa establishments, workers in the entertainment industry and agricultural workers. The Relaunch Decree went on to state that the indemnity in place for March would also be paid out in April. Anyone who applied at a later date will also receive the indemnity: seasonal workers other than in the tourism sector, occasional workers and intermittent workers.
- € 1,000 for the month of May: the Relaunch Decree introduced this indemnity for freelancers with a VAT number, who are not retired and are not enrolled with other compulsory forms of social security; to receive this indemnity, the individuals in question must have recorded at least a 33% decrease in their income in March and April 2020 compared with the same period in 2019. This indemnity is also available for those with a “Co.Co.Co” (freelance work contract coordinated by an employer) whose work relationship ended when the decree came into force.
- Artisans, traders and owner-farmers: the Relaunch Decree stated that, as of May, these categories may be classed alongside partnerships or limited liability companies, falling within the scope of the activities of the Agenzia delle Entrate (Italian Revenue Agency), which provides non-refundable indemnities to businesses that have suffered a 33% drop in turnover. The indemnities are calculated based on the loss in turnover, with a minimum value of € 1,000.
- Professionals enrolled with official registers: these professionals will continue to be managed by their professional funds for the months of April and May.
‘Last-resort income fund’ for anyone excluded from the € 600 indemnity: the Cure Italy Decree established a ‘last-resort income fund’, aimed at guaranteeing income support for employees and self-employed workers who have had to cease, reduce or suspend their employment relationship or business as a result of the COVID-19 emergency. € 300 million has been allocated to this fund for 2020, dedicated to professionals enrolled with official registers and other professionals who are excluded from the € 600 indemnity, helping a total of 500,000 people.
‘Emergency Income’: the Relaunch Decree introduced this form of extraordinary support for families in difficulty due to the Covid-19 emergency; the ‘emergency income’ is paid in two instalments, each with a value of between € 400 and € 800 (€ 840 for families with severely disabled members or members who are not self-sufficient). The August Decree introduced an additional 'emergency income’ payment of € 400, subject to families submitting a new application by 15 October 2020. This support measure is destined for a million families; in order to qualify, families must be resident in Italy, their income in April must be lower than the amount of the benefit and they must have movable assets worth less than € 10,000 as at 2019 (this threshold may be raised up to a € 25,000 depending on the family unit) and an ISEE value of less than € 15,000. The ‘emergency income’ cannot be claimed together with other forms of government support made available following the Covid-19 emergency and is not paid out to those with a pension, to those with an employment contract with a gross salary above the benefit itself or to those who already receive Italy's ‘citizenship income’.
Domestic workers and carers: the Relaunch Decree introduced an indemnity of € 500 per month for April and May 2020 for domestic workers with one or more work contracts of over 10 hours a week, in place as at 23 February 2020. This law, for which just under € 500 million has been set aside, excludes domestic workers who live with their employer and those who receive emergency income or citizenship income.
Unconditional access to ‘Citizenship Income’: without prejudice to the ability to receive the economic benefits, in consideration of the containment measures implemented to tackle the spread of the virus, the Cure Italy Decree introduced a two-month suspension of the obligations involved with receiving ‘citizenship income’ and of the relative selection procedures, as well as extending the deadlines for applicants to be called to job centres to take part in guidance initiatives, all with the aim of ensuring that people only move around if absolutely necessary.
Wage subsidies to avoid redundancies: in accordance with the new European Temporary Framework, the Relaunch Decree introduced the possibility for local authorities to adopt aid measures to support the economy, contributing to companies’ and self-employed workers’ wage costs (including social security contributions) and avoiding lay-offs during the pandemic. This subsidy has a duration of 12 months, it is aimed at employees who would otherwise have lost their jobs and it must not exceed 80% of their gross monthly salary.
Bonuses for workers continuing to physically go to work: the Cure Italy Decree stated that workers with a gross annual income of up to € 40,000 who carried out their jobs at their workplace during the month of March (not via smart working) would receive a € 100 incentive (in proportion to the number of days worked). This bonus does not contribute to employees’ taxable income.
Support for healthcare workers: the Cure Italy Decree allocated an additional € 250 million in 2020 to pay for services linked to the working conditions of health professionals (national health service employees), who are directly involved in combating the epidemiological emergency caused by the spread of the COVID-19 virus. The Relaunch Decree set aside an additional € 190 million for incentives for doctors, nurses and all healthcare workers. In order to promptly respond to the demand for outpatient services, screening and hospitalisation that were not provided during the epidemiological emergency, and to reduce waiting lists, the August Decree set aside approximately € 500 million for the additional services of medical personnel.
Overtime for public security forces: the Cure Italy Decree set aside over € 100 million to pay for overtime and other expenses due to the police force, armed forces, penitentiary police, fire brigade, prefecture employees, civil administration of the interior and local police for the extra tasks they had to complete during the emergency, as well as for the sanitisation and extraordinary disinfection of their offices, work environments and vehicles, and to ensure that they had adequate personal protective equipment. The Relaunch Decree allocated more than € 167 million from the ‘Fund for national emergencies’ to the emergency management departments of the Ministry of the Interior, the armed forces, the police force and the fire brigade, in order to pay for overtime and public order allowances. The August Decree set aside an additional € 30 million.

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