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Minimum wage in Italy

Italy's Payroll

Social security in Italy

Other employee benefits in Italy

Compliant, seamless payroll and benefits in Italy and beyond

Payroll in Italy

Employees in Italy enjoy an organised pay structure, characterised by sector-specific wage agreements, and extensive benefits.

Rather than a national minimum wage, the national collective bargaining agreements determine the wages, which vary by industry. Taxes are progressive, and social security contributions cover pensions, healthcare, and other benefits, with both employees and employers contributing.

Understanding this essential information about Italy’s payroll system will help you ensure your employees are paid fairly, protecting your business from potential legal disputes.

Outsourcing payroll services in Italy

In the most recent Global Payroll Complexity Index or GCPI report, Italy was ranked fifth in terms of payroll complexity. This covers both setting up and effectively running payroll. One of the most impactful reasons for this is the sheer number of collective bargaining agreements employers have to take into consideration when paying their workers.

Because of this, outsourcing payroll has been a preferred solution to many companies, especially for businesses that are unfamiliar with Italy’s labor laws and regulations. Working with a reliable global payroll service provider, such as CXC, can take care of these complexities and help you avoid costly payroll mistakes. This way, you can save time and resources and focus on your core business. Going this route also ensures that employees are always paid on time, and that regulations are followed.

In this guide, we will explore everything you need to know around payroll in Italy, including the minimum wage, payroll cycle, working hours, remote work policy, and more.

Minimum wage in Italy

Since there is no mandatory national minimum wage in Italy, several factors determine the minimum pay an employee is entitled to receive. In practice, sector rules and contract type are the main drivers of minimum pay levels in Italy in 2026.

Italy’s minimum wage policy

Wages in Italy are primarily determined through sector-specific national collective bargaining agreements (CBAs/CCNL). These agreements are negotiated between unions and employer associations and set minimum pay scales, classifications, allowances, and progression rules across industries such as manufacturing, retail, services, and agriculture. Because minimum pay is defined by the applicable agreement, minimum wages can vary significantly by sector and job classification. This system helps align pay with industry conditions, but it also means Italy does not have a single uniform wage floor nationwide.

Average minimum wage” in Italy

Because minimum pay is negotiated by sector, any “average minimum wage” is only an approximation. In 2026, minimum pay levels set in many CBAs often translate to roughly €7 to €9 per hour (gross) for lower-grade roles, depending on the sector and job level. Region can also influence overall earnings through market practice and allowances, with wages often trending higher in Northern Italy than in the South. For low-skilled full-time roles, minimum monthly earnings commonly fall around €1,200 to €1,500 gross per month, depending on the applicable CBA, job grade, and working time. Net take-home pay will vary based on tax and social contributions.

Minimum pay for different types of workers in Italy

Apprentices and interns: Apprentices typically earn less than fully qualified employees because pay is tied to training status and progressive wage steps under the applicable CBA. Monthly pay can vary widely by sector and apprenticeship year, and is often lower than standard entry-level wages.

Part-time workers: Minimum pay is applied pro-rata. Part-time employees must receive at least the same hourly-equivalent CBA minimum as comparable full-time employees in the same sector and classification, adjusted for their reduced hours.

International students: There is no separate minimum wage for international students. They are entitled to at least the minimum pay set by the applicable CBA for the role and classification, with working time governed by the terms of their contract and any immigration-related limitations.

Italy's Payroll

Understanding how payroll works in Italy is crucial for businesses and employees alike. Italy’s payroll system is distinct due to various laws, mandatory contributions, and unique components like the 13th-month salary.

Payroll cycle in Italy

The standard payroll cycle in Italy is monthly, with salaries usually being paid on the 27th of each month.

Employers are required to provide detailed pay slips that break down earnings, taxes, and deductions. These pay slips are vital for workers to understand their total compensation, including any variable elements like overtime or bonuses.

In addition, Italian law requires that employees are paid regularly, and delayed payments can lead to penalties for employers. For workers on fixed-term contracts or those in temporary roles, payroll cycles may vary slightly, but the monthly schedule is generally the norm across sectors.

13th-month salary in Italy

One unique feature of Italian payroll is the mandatory 13 th -month salary, known as the “tredicesima”. This is an additional monthly salary paid to employees, typically in December, just before Christmas. The 13 th -month salary is a form of deferred compensation designed to help employees with the added expenses of the holiday season.

In some sectors, employees may also receive a 14 th -month salary, usually paid in June or July. This is more common in industries like manufacturing and banking, where collective bargaining agreements provide additional compensation structures. Both the 13 th – and 14 th -month salaries are prorated based on the time worked during the year for new hires.

Italy’s social security system offers a wide range of benefits to employees and self-employed individuals alike. Understanding the nuances of social security contributions in Italy is critical when hiring and engaging local talent compliantly.

Social security contributions in Italy

Social security contributions in Italy are mandatory for both employers and employees, with the majority of the funds allocated towards pensions, healthcare, unemployment benefits, and other welfare programs. Contributions are handled by the INPS or Istituto Nazionale della Previdenza Sociale, Italy’s national social security institution.

Employers’ social security contributions typically range from 29% to 32% of an employee’s gross salary, depending on the sector and the applicable collective bargaining agreements.
On the other hand, employees contribute around 9% to 10% of their gross salary towards social security. These contributions are deducted directly from their pay and managed by the employer.

Social security benefits in Italy

Both employee and employer contributions are used to fund a variety of benefits, including the following:

Health services and sickness compensation
Incapacity and disability benefits
Maternity, paternity, and parental leave pay
Occupational accidents and diseases benefits
Unemployment benefits
Old age and survivor’s pensions

To ensure transparency, all contributions and their exact amounts are listed on the monthly pay slips of employees.

Self-employed social security contributions in Italy

Self-employed individuals in Italy, including freelancers and independent contractors, are also required to make social security contributions. However, the structure for the self-employed differs slightly from that of traditional employees.

Those who are self-employed typically follow a separate social security regime, which takes into account that they are essentially paying for both the employee and employer contributions. The rate for the self-employed in Italy varies but is generally around 25% to 30% of gross income. This contribution is split between mandatory pension funds and healthcare.

There are several social security schemes available for distinct categories of self-employed individuals. For instance, those in specific professions, like lawyers or doctors, may pay into private pension schemes regulated by their professional bodies. Meanwhile, other freelancers pay directly to the INPS through a dedicated system for independent workers.

Pension schemes in Italy

Pensions in Italy are structured based on an individual’s contribution history. The pension system operates on a pay-as-you-go basis, meaning today’s workforce funds the pensions of current retirees.

To qualify for a pension in Italy, individuals generally need to have contributed to the social security system for at least 20 years. The retirement age in Italy is currently 67, although this can vary depending on ones’ employment history and any early retirement provisions. Pension amounts are calculated based on the total number of years of contributions and the average income during an individuals’ working life.

Italy also provides survivor pensions for spouses and children, as well as disability pensions for individuals unable to work due to health conditions. These pensions are funded by both employer and employee contributions, making Italy’s social security system one of the more comprehensive in Europe.

Special category pensions in Italy

There are special pensions available for workers in specific industries or with unique employment statuses. For example, individuals in the public sector, military, and law enforcement often have different pension schemes than those in the private sector.

Additionally, Italy provides early retirement options for workers in physically demanding jobs. Known as “lavori usuranti” or strenuous work, individuals who qualify for this category may retire earlier, often at 61 or 62, provided they have sufficient contribution years. This category includes professions like miners, construction workers, and nurses working in intensive care units.

Farmers and agricultural workers also have access to special pension schemes under INPS, where contribution rates are typically lower but are compensated by the state to ensure a fair pension upon retirement.

Other employee benefits in Italy

In addition to salaries and pensions, many employees in Italy enjoy a variety of additional benefits that improve their quality of life. These benefits, not mandated by law, can include health insurance, meal vouchers, company perks like cars or mobile phones, and flexible working conditions.

Employee health insurance in Italy

While Italy has a public healthcare system, many companies offer private health insurance as part of their employee benefits package.

Private health insurance in Italy typically supplements the public system by providing quicker access to specialists, better hospital accommodations, and coverage for medical expenses that the public system does not fully reimburse, such as dental care and certain prescriptions.

Private health insurance is not a mandatory employee benefit in Italy, but it is increasingly popular, especially among multinational companies and larger businesses. By offering private health insurance, employers can attract top talent, especially those who value quicker access to healthcare services.

Employee meal vouchers in Italy

Meal vouchers are a common and popular benefit in Italy, known as “buoni pasto..” These vouchers are provided by employers to subsidize meals for employees during working hours. Meal vouchers are often distributed in paper or electronic form and can be used at restaurants, cafes, and supermarkets. The value of each meal voucher typically ranges from 5 EUR to 10 EUR per day, depending on the company.

Meal vouchers are a non-mandatory employee benefit in Italy, but many companies offer them as a tax-efficient way to compensate employees. For employers, offering meal vouchers is beneficial because they are partially exempt from social security contributions and income taxes, up to a certain limit. For employees, meal vouchers provide a significant savings on daily food expenses.

Company car and mobile phone benefits in Italy

For higher-level employees or those whose job involves extensive travel, company cars are a common perk. Company cars are provided by employers for both professional and personal use. The exact terms depend on the company policy, but they usually include all costs related to the car, such as insurance, maintenance, and fuel.

The mobile phone benefit is also widely offered, particularly to employees who need to stay connected for work. Many companies provide smartphones along with data plans, covering both business and personal use. This is especially common in the tech, sales, and management sectors.

These benefits offer employees the convenience of staying connected and mobile without incurring personal costs, and they are tax-deductible for the employer, which makes them an attractive perk for both parties.

Flexible work benefits in Italy

In recent years, flexible work benefits have gained traction in Italy, especially after the pandemic reshaped the workplace. Flexible work arrangements include remote work, flexible hours, and part-time arrangements. Italian labor laws provide employees the right to request flexible working hours, particularly for those with caregiving responsibilities, such as parents with young children.

While not mandatory, offering flexible work benefits in Italy can enhance employee satisfaction, improve work-life balance, and increase productivity. Many companies now offer hybrid working models, where employees can split their time between the office and working from home. These arrangements are particularly common in sectors like technology, finance, and consulting.

Compliant, seamless payroll and benefits in Italy and beyond

Getting payroll and benefits right is not just a legal issue. Every country also has its own customs, norms, and expectations about employee compensation. And if your operations aren’t in line with your workers’ expectations, they may not stick around for long.

Thankfully, we know what we’re doing. When you work with CXC to engage workers in Italy, we’ll handle everything from tax withholding to employee bonuses on your behalf.

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