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Here comes the release of redundancies

1 July 2021
- Di
Tempo di lettura: 4 minuti

RELEASE OF REDUNDANCIES - During the pandemic crisis several manoeuvres were put in place to protect workers. Many have been successful, many others have been a real flop. It also applies to the block of redundancies, which is now at the end of the line. But could one speak before a real blockage? And is it right to speak now about the release of dismissals? Let’s analyze the question together.

Release the redundancies, what include

The Decreto Cura Italia has banned all individual dismissals and suspended collective dismissal procedures, since the beginning of the pandemic. It has come to the aid of companies and workers along with a number of other actions, including social shock absorbers. Since the beginning of the crisis, however, the ban on dismissals has been seen, revised and extended several times. In fact, it was initially scheduled for only 60 days, then expiring in April 2020, in fact it has continued throughout 2021. Given the ban on terminating the employment relationship, an ad hoc redundancy fund was devised specifically for the health emergency to which companies could resort and which imposed a mandatory ban on dismissal. In this way, an attempt has been made to avoid a chain of collective redundancies or redundancies for justified objective reasons.

Obviously, however, all redundancies due to non-economic reasons or to productive activity have been excluded from this category. For example:

  • Redundancies justified by the firm’s definitive cessation of activity;
  • Dismissals on the grounds that the firm has definitively ceased to operate as a result of the liquidation of the company without any continuation, even partial, of its activities, where, in the course of liquidation, the sale of a set of assets or assets which may constitute a transfer of an undertaking or a branch of it is not intended;
  • Collective agreement between companies, signed by the unions which are comparatively more representative at national level, to encourage the termination of the employment relationship (NASPI unemployment benefit is granted to those who adhere to the said agreement in the presence of the other conditions);
  • Dismissals intimated following the bankruptcy of the company, in the event that the provisional operation of the company is not planned or is ordered to cease.

In the rest of Europe?

In the rest of Europe, behaviour has tended to be different. In fact, there have been countries, such as Germany and the United Kingdom, where no blockage has been imposed, and others which, unlike Italy, have imposed a blockage, but for limited periods of time or under more stringent conditions, amounting to only a few cases. Italy was the only one of its kind.

From the first of July 2021 start the release of redundancies 

During the month of June, a period close to the deadline set in March, the government reached an agreement on the release of redundancies. I say reached an agreement because obviously every political force in the field was carrying out completely different ideas among them. The common intent, however, was found and will be valid from July 1, 2021.

The Decree of 30 June 2021, provides

  • extension of the block of redundancies and of the CIG Covid until 31 October only for the sectors most in crisis, namely the textile, footwear and fashion industries.
  • Extension of the Extraordinary Redundancy Fund (CIGS) for a maximum of 13 weeks for the 85 crisis tables currently open at the Ministry of Economic Development with related redundancy block;
  • 6 months of CIGS for companies in the aviation sector, with related layoffs freeze;
  • 13 further weeks of the IGC, until 31 December 2021, for all companies that no longer have instruments of wage integration.

Therefore, all non-textile, footwear and fashion sectors are exempted from the block, and those who until 31 October 2021 will make use of State aid in the Covid-19 field.

Was the ban and the release of the redundancies worth anything?

Now that we have seen the technical parts of the Decree Salva Italia and the Decree Lavoro, let’s see the results.

This last measure has created a wide-ranging debate in recent months which revolves around a simple question: is the ban on dismissal a fair measure for all workers and a useful way of genuinely supporting employment?

"The answer is found in the figures: in 2020, job losses decreased, but also, and to a greater extent, new recruitments decreased. In 2019 there were in fact 6.8 million new hires, while in 2020 only 4.7 million. This is because the total blocking of redundancies, in addition to preserving employees, also causes a tightening of the system and prevents workers from moving from sectors in crisis to other more dynamic.

According to Istat then, in 2020 the number of fixed-term workers decreased by 11% and that of self-employed workers by almost 4%. This meant that the highest price of the crisis was paid by young people and women who represent the majority of this country’s precarious workforce. In fact, the number of people employed between 15 and 24 years fell by 13%, those between 25 and 34 years by 5%, while the number of women employed decreased by 3%, compared to 1% of men."

That’s what Will_Ita picked up. The evidence shows that the blockade has particularly hampered young people, women, temporary workers, self-employed and seasonal workers. Only permanent workers, but also workers for a limited period of time

To learn more about unemployment and hiring, click here.

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