I-ii.2 Extraordinary benefits from the Wage Compensation Fund - CIG
3.2.2.I-ii.2 Extraordinary benefits from the Wage Compensation Fund - CIG (Interventi straordinari della Cassa Integrazione Guadagni - CIG)
3.2.2.1. Aim
The aim is not only to maintain income levels, but also to secure employment once productive activity in the restructured, reorganised or converted company has been resumed
3.2.2.2. Legal basis
A large number of legal provisions apply. Of the laws mentioned so far, the following deal with this matter: Law 1115/68; Law 464/72; Law 164/75; Law 215/78; Law 427/80; Law 155/81; Law 416/81; Law 68/82; Law 160/88, etc. Amendments were introduced by Law 223/91; Decree-Law 128 of 20.5.1993, converted into Law 236 of 19.7.1993; and Decree-Law 299/94, converted into Law 451/94.
3.2.2.3. Contents
Extraordinary wage compensation can be provided in the following cases:
1. restructuring, reorganisation of conversion of a company (Art. 1, par. 4, Decree-law 299/94, converted into Law 451/94);
2. crisis situation within a company (Art. 1, par. 5, Law 223/91);
3. company bankruptcy;
4. compulsory liquidation by administrative order;
5. in cases of special administration in which economic activity is terminated (Art. 3, par. 1, Law 223/91);
6. where a job-security contract exists (Art. 1 Decree-law 726 of 30.10.1984, converted into Law 863 of 19.12.1984; Art. 7 Decree-law 536 of 30.12.1987, converted into Law 48 of 29.2.1988; Art. 5 Decree-law 148 of 20.5.1993, converted into Law 236 of 19.7.1993).
The following are eligible for the extraordinary CIG:
- industrial firms (including construction and related firms) which in the six months prior to application employed on average more than 15 workers (including trainees);
- cooperatives and their members processing, transporting or marketing animal or plant products (Art. 3, Law 240 of 15.6.1984);
- companies in the trade sector employing more than 200 workers (Art. 12, par. 3, Law 223/91);
- craft firms with more than 15 employees shedding labour under the extraordinary wage compensation scheme under the terms of Art. 12, par. 1 of Law 223/91;
- leased canteen firms which suffer reduced output due to the economic crisis in the leasing firm;
- firms in the railway support sector.
Also entitled from 1.1.1994 are:
- lessor cleaning firms suffering from the economic crisis in the leasing firm, provided they are involved in the implementation of company crisis programmes or restructuring, reorganisation or conversion programmes by the leasing firm associated with entitlement to CIGS benefits (Art. 1, par. 7, Decree-law 299/94, converted into Law 451/94).
Also entitled until 31.12.1995 are:
- firms in the trade sector with more than 50 employees (Art. 7, par. 7, Decree-law 148/93, converted into Law 236/93);
- travel agents and travel companies with more than 50 employees (Art. 7, par. 7, Decree-law 148/93, converted into Law 236/93);
- security firms (Art. 7, par. 7, Decree-law 148/93, converted into Law 236/93);
- private radio and television companies and those linked to them in functional terms (Art. 7, par. 4, Decree-law 148/93, converted into Law 236/93).
Also entitled until 31.12.1994 are:
- transport and haulage firms with at least 50 employees (Art. 7, par. 7, Decree-law 148/93, converted into Law 236/93).
The benefits are available to the following groups of persons:
1. blue-collar workers, those of equal status and "intermediate-category" employees (intermedi);
3. managerial staff employed by the afore-mentioned companies.
Workers made redundant lose their entitlement to wage compensation if they refuse to attend a vocational training or retraining course, or engage in self-employment or dependent employment while drawing benefit from the wage compensation fund.
The extraordinary wage compensation amounts to 80% of the pay the worker would otherwise have earned during the hours lost, subject to a maximum monthly benefit of LIT 1,248,021 gross (for workers earning up to LIT 2,700,000 gross). For those employees earning more than the last-mentioned figure, the extraordinary wage compensation amounts to LIT 1,500,000.
3.2.2.4. Institutional support
Responsibility for administering the extraordinary contributions from the CIG lies with the INPS. Companies must submit their application for extraordinary wage compensation to the regional or provincial employment office responsible for their specific location. The application is to contain, in addition to the justification, the nature and duration of the lay-offs, the criteria for the selection of the employees to be laid off and the procedure for rotation between the employees laid off (Art. 1, § 7, Law 223/91).
Enterprises that consider that they will not be in a position subsequently to re-employ the redundant employees may proceed according to the regulations governing the shedding of surplus labour. The workers affected will be recorded in the "mobility lists" so as to facilitate their reintegration into the labour market.
3.2.2.5. Financial resources
The contributions are composed as follows:
1. a contribution of 0.9% of the earnings subject to contributions (Art. 9, Law 407/90), of which 0.6% is paid by the employer and 0.3% by the employee;
2. an additional contribution (Art. 8, Law 160/88) of 3% for firms with 15 to 50 employees and of 4.5% for firms employing more than 50 workers.
3.2.2.6. Duration
In the case of a crisis within the enterprise the measure is to last 12 months. This is extended to 24 months for firms undergoing restructuring, reorganisation or conversion (Art. 1, § 4, Decree 299/94, converted into Law 451/94).
Exemptions from the maximum duration of 12 months may be granted by the Ministry of Labour for particularly complex programmes, with regard to the technical characteristics of the manu-facturing processes within the company or to the employment effects of the restructuring or reorganisation measures, etc.
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