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Ordinary allowance or replacement allowance for dependent workers of companies registered with the solidarity funds
The solidarity funds, governed by Articles 26 et seq. of Italian Legislative Decree no. 148 of 14 September 2015, provide income support tools in the event of suspension or termination of the working activity of those employed by companies belonging to sectors that are not covered by legislation on wage subsidies.
The ordinary allowance is the primary benefit paid by the aforementioned funds and consists of a wage subsidy that is of equal or greater value than the wage compensation fund.
The ordinary allowance, previously regulated by Article 3, paragraph 31 of Law no. 92 of 28 June 2012, is now governed by Article 30, paragraph 1 of Italian Legislative Decree no. 148 of 14 September 2015, which at the same time provided for the repeal of the previous regulations.
The benefit is intended for dependent workers, excluding managers unless otherwise specified, of companies that usually have more than five dependent workers, during restructuring processes, crisis situations, major corporate reorganisation, or the reduction and transformation of activities or work, for the causes provided by the law on ordinary and extraordinary payroll integration and if also provided in conjunction with the appropriate support tools provided by current legislation.
From 24 September 2015, the ordinary allowance provides a temporary cover that differs according to the invoked reason. The following table summarises the maximum limits of the cover for each individual reason:
|MAXIMUM DURATION OF COVER OF THE INDIVIDUAL REASONS|
Reference to Italian Legislative Decree no. 148/2015
Transitional and non-attributable events
13 weeks up to a maximum of 52 in a two-year rolling period
Temporary situations in the mobile market
13 weeks up to a maximum of 52 in a two-year period
24 months in a five-year rolling period
12 months. A new Claim may be granted no earlier than two-thirds of the way through the period covered by the previous authorisation
24 months in a five-year rolling period
24 + 12 months in a five-year rolling period
The duration limits provided for by Article 30, paragraph 1 of Italian Legislative Decree no. 148/2015 must be understood as the limits within which the decree can establish the duration of the service provided by the individual funds. They may therefore last for different lengths of time, provided that they are not less than 13 weeks and not longer than the lengths laid down in Articles 12 and 22 of the same decree.
What am I entitled to?
The amount of the benefit is equal to at least 80% of the wages that are taxable for social security purposes and that would be due to the worker for the hours they did not work, in application of the limits of the Ordinary Wage Compensation Fund (CIGO). The decrees establishing the individual funds may provide for larger amounts.
The allowance is reduced in the event of a combination of income support tools, of equal amount, provided for by current legislation on the industry's wage compensation fund.
Therefore, for 2019, the maximum gross monthly benefit is €998,18 for salaries equal to or less than €2.159,48 and €1.199,72 euro for salaries greater than €2.159,48 (INPS Circular no.20 of 10 February 2020). The 5.84% reduction for apprentices is applicable for some funds, provided for by Article 26 of Law no. 41 of 28 February 1986. In this case the reduced amount remains available to the fund.
For the disbursement period of the allowance, the related contribution shall be paid to the pension scheme to which the policy holder is a beneficiary.
For the ordinary allowance, the following are due to the fund: an ordinary contribution that varies between 0.20% and 0.50% according to the fund (of which two thirds are borne by the employer and a third by the dependent workers), calculated on the payment that is taxable for social security purposes for all permanent dependent workers, excluding or including managers according to the fund. This is to guarantee the provision of adequate continuous resources and must also be verified on the basis of the budget estimates. Any changes to the measure are distributed between employer and employee according to the same distribution criteria; there is also an additional contribution of at least 1.5% to be borne by the employer, calculated according to the salaries that are taxable for social security purposes, and applied to the salaries lost by dependent workers who are receiving ordinary allowances.
Once the funding has been approved by the Fund's Management Committee, the INPS office issues the relevant payment authorisation that is required for the economic benefit to be paid to the workers concerned. The approval will then be communicated to the company and shall be made available within the bidirectionalbox.
For the wage subsidy fund, the wage subsidy benefits are authorised by INPS' territorial structures.
The benefit is authorised with an equalisation payment from the employer, starting from the month following the one in which the authorisation was granted. For the communication of data needed for the adjustment payment, the employer can make use of the UNIEMENS data flow, as illustrated in the INPS Circular no. 170 of 15 November 2018.
The direct payment of the benefit may be exclusively authorised in the case of the firm's serious and documented financial difficulties, proven by submitting the documentation referred to in annex 2, INPS Circular no. 197 of 02 December 2015, to the local INPS office in charge. .
The related contribution is calculated on the basis of the payment that is taxable for social security purposes and is used to acquire the right to a pension, including the early-retirement pension, as well as to determine its amount.
The calculation is carried out based on the current finance rate in the beneficiary worker's compulsory insurance scheme.
As far as is compatible, the legislation on ordinary income support applies to the ordinary allowance. The benefit may be paid to the beneficiary worker on the condition that they do not carry out any working activities for third-party subjects during the reduction or suspension period. The worker that carries out employed or self-employed work during the wage subsidy period does not have the right to the benefit for the days of work carried out.
For a more in-depth analysis of cases involving partial inability to combine pensions, please refer to INPS Circular no. 130 of 04 October 2010.
For self-employment, prior notification of the beginning of the self-employment must be given to the INPS office in charge.
Access to the ordinary and special benefits is subject to the completion of the legislative and contractual procedures for trade union discussion, provided for by collective bargaining, and may be subject to the conclusion of such procedures by means of a company agreement that identifies a number of tools for processes that change personnel working conditions or lead to a reduction in employment levels.
Wage subsidies must be granted for the time required for interrupted production to be resumed. The intervention is aimed as supporting both contingent, short-term corporate crises and long-term corporate crises linked to production downsizing.
Article 30, paragraph 1 of Italian Legislative Decree no. 148/2015 identifies the events that may justify the use of the ordinary allowance, with the reasons provided for by the legislation on ordinary and special wage subsidies.
The ordinary allowance may be claimed for:
- company situations caused by transitional events that cannot be attributed to the company or to dependent workers;
- temporary market situations;
- corporate reorganisation;
- business crises, except in the case of termination of productive activity of the holding or a branch thereof;
- solidarity contracts.
When can I claim?
In accordance with Article 30, paragraph 2 of Italian Legislative Decree no. 148/2015, the Claim must be submitted no earlier than 30 days prior to and no later than 15 days after the start of the suspension or reduction in working activity: in the first case the Claim must be submitted within 30 days, and in the second there will be a postponement of the benefit's start date and it may not take place for periods of earlier than one week prior to the date of submission (Monday of the preceding week).
How can I claim?
The employer must submit the eligibility claim for the ordinary benefit to the INPS online by using the dedicated service.
Subsequently, it will be examined by the Fund's Management Committee, which has the task of deciding on the granting of benefits, taking into account the chronological order in which claims are submitted and the fund's available resources (INPS Circular no. 122 of 17 June 2015 and INPS circular no. 201 of 16 December 2015).