In Italy, employers will be exempt from contributions for employees under 35

In Italy, private employers will be able not to pay pension contributions for employees under 35 years of age who are transferred from fixed-term contracts to permanent contracts. The maximum benefit will be 500 euros per month per employee.

The benefit provides for the employer's exemption from 100% of social security contributions for a period of up 24 months. At the same time, it does not apply to insurance premiums and payments to the National Institute for Insurance against Accidents at Work (INAIL).

The program can be used when transferring an employee to a permanent contract between 1 August and 31 December 2026. The initial fixed-term contract must have been concluded no later than 30 April 2026, and its total duration must not exceed 12 months. The transition to permanent employment must take place without a break between contracts.

At the time of the transfer, the employee must not yet have turned 35 years old. Furthermore, the employee must not have previously worked under a permanent employment contract throughout their entire work history.

The program applies to blue-collar workers, white-collar employees, and mid-level managers. The benefit cannot be obtained for domestic workers, participants in vocational training programs, and senior-level managers. It also does not apply to new hires — only to the conversion of existing fixed-term contracts into permanent ones.

The company must have no contribution debt, comply with occupational safety rules and the terms of national collective agreements. The employee transfer must also result in a net increase in the number of staff compared to the average figure over the previous 12 months.

Applications will be accepted by the National Institute of Social Security of Italy via the online benefit portal Portale delle Agevolazioni. For this purpose, employers will need to fill out a special form "Incentivi decreto Lavoro 2026 - Incentivo alla stabilizzazione". INPS has stated that the form and detailed instructions will be published separately. 

The benefit is not a payment to the employee: the funds will be received by the employer in the form of a reduction in mandatory contributions. The goal of the program is to encourage companies to transfer young workers to stable permanent contracts.

According to: the National Institute of Social Security of Italy