Individual Case (CAS) - Discussion: 2015, Publication: 104th ILC session (2015)

Employment Policy Convention, 1964 (No. 122) - Italy (Ratification: 1971)



The Government provided the following written information.

According to the latest National Institute of Statistics (ISTAT) data (June 2015), there was an increase in the employment rate between April and March 2015. In April, the numbers in employment increased by 0.7 per cent (159,000 more employees than the previous month), with the level of employment returning to the levels of 2012 and the employment rate rising to 56.1 per cent. The unemployment rate has fallen to 12.4 per cent. According to ISTAT, the rate of unemployed young people aged 15–24 who are actively seeking work has fallen to 40.9 per cent. The Organisation for Economic Co-operation and Development (OECD) has also provided estimates for employment in Italy, has welcomed the Jobs Act and expects a fall in unemployment in 2016.

Main labour market indicators, per gender, geographical area and age (2012–14)

 

		2012				2013				2014
		Employment rate	Unemployment rate	Activity rate		Employment rate	Unemployment rate	Activity rate		Employment rate	Unemployment rate	Activity rate
Gender	Male	53,4	9,8	59,2	51,9		11,5	58,6	51,7		11,9	58,7
	Female	35,0	11,8	39,7	34,5		13,1	39,7	34,6		13,8	40,1
Area	NW	48,7	8,0	52,9	48,3		8,9	53,0	48,2		9,3	53,1
	NE	50,7	6,6	54,3	49,6		7,7	53,7	49,7		7,7	53,9
	Central	46,6	9,4	51,4	45,9		10,7	51,4	46,4		11,4	52,3
	South	34,7	17,1	41,9	33,2		19,7	41,3	32,8		20,7	41,3
Age	15-24	18,5	35,3	28,6	16,3		40,0	27,1	15,6		42,7	27,1
	25-29	57,3	18,1	69,9	52,7		22,2	67,7	51,7		23,6	67,6
	15-29	32,3	25,4	43,3	29,1		29,8	41,5	28,3		31,6	41,5
	30-44	72,5	9,7	52,9	70,8		11,1	79,6	70,2		11,7	79,5
	45-54	72,0	6,7	77,1	70,9		8,0	77,0	70,3		8,4	76,7
	55 and above	17,3	4,9	18,2	18,2		5,3	19,2	19,5		5,0	20,5
	15-64	56,6	10,8	63,5	55,5		12,3	63,4	55,7		12,9	63,9
Total		43,9	10,7	49,1	42,9		12,1	48,8	42,8		12,7	49,1
Source: ISTAT, RCFL media annuale.

 

Unemployment rate per geographical area and age (2012 and 2014)

 

	2012					2014
	15-24	25-29	15-29	15 and above		15-26	25-31	15-31	15 and above
Piemonte	32,1	12,6	20,9	9,2	42,2		19,8	29,3	11,3
Valle d’Aosta	25,6	6,0	14,2	7,1	34,9		14,4	22,7	8,9
Lombardia	26,5	10,9	17,2	7,4	31,2		12,8	20,3	8,2
Liguria	30,2	13,5	20,7	8,1	45,0		24,8	32,9	10,8
Total North West	28,4	11,5	18,5	8,0	35,5		15,7	23,8	9,3
Trentino alto Adige	15,1	7,3	11,1	5,1	18,4		8,9	13,4	5,7
Veneto	23,3	8,8	15,0	6,4	27,6		10,9	18,0	7,5
Friuli Venezia Giulia	29,7	11,1	18,1	6,7	27,1		19,2	22,4	8,0
Emilia Romagna	26,7	11,2	17,5	7,0	34,9		15,7	23,7	8,3
Total North East	24,0	9,8	15,8	6,6	29,0		13,2	19,9	7,7
Tuscany	29,4	13,1	19,9	7,8	35,7		18,8	25,9	10,1
Umbria	34,6	15,9	23,8	9,5	42,5		21,6	30,0	11,3
Marche	28,6	16,5	21,4	9,1	36,4		15,0	23,4	10,1
Lazio	40,0	20,9	28,4	10,6	49,0		25,4	34,2	12,5
Total Central	34,7	17,6	24,5	9,4	42,4		21,8	29,9	11,4
Abruzzo	34,0	17,7	24,9	10,8	47,4		22,0	31,6	12,6
Molise	41,5	27,8	33,5	12,0	49,3		35,3	40,9	15,2
Campania	48,4	33,1	40,3	19,2	56,0		38,2	46,4	21,7
Puglia	41,6	25,3	32,6	15,7	58,1		34,1	44,9	21,5
Basilicata	49,9	27,4	36,9	14,5	46,6		31,3	37,5	14,7
Calabria	53,9	30,9	40,8	19,4	59,7		45,8	51,9	23,4
Sicily	51,2	33,3	41,7	18,4	57,0		42,5	49,2	22,2
Sardinia	47,5	28,0	36,5	15,4	50,0		39,8	44,3	18,6
Total South and islands	47,1	29,5	37,5	17,1	55,9		37,8	45,9	20,7
Total Italy	35,3	18,1	25,4	10,7	42,7		23,6	31,6	12,7
Source: ISTAT, RCFL media annuale.

 

In recent years, Italy has adopted important labour market reforms (the so-called Fornero Reform in 2012, the Youth Plan Reform in 2013 and the Jobs Act in 2014). All of these reforms are aimed at reducing the high unemployment rate and, in particular, the youth unemployment rate, through a structural revision of public employment services and a simplification of the types of labour contracts. The Fornero Reform (Act No. 92/2012) established several protection measures for the working conditions of women and young workers and relaunched apprenticeships and vocational training. The Youth Plan (Decree No. 34/2013, converted into Act No. 99/2013) is a follow-up to an earlier reform, in accordance with the Europe 2020 Strategy. It introduced measures aimed at reducing the mismatch between labour demand and supply and at tackling youth unemployment through the implementation of the European Youth Guarantee Programme and economic incentives for employers who hire workers. Act No. 147/2013 also established the Fund for Active Policies to enhance the employability and reintegration of workers into the labour market. The latest measure has been the Jobs Act Reform (Acts Nos 78/2014 and 183/2014) which, through subsequent legislation, will include: the reform of the public employment service system and the establishment of a National Employment Agency; the revision of the system of social shock absorbers and provisions on the dismissal of workers; the simplification of types of contracts (see below, the reform of the apprenticeship contract); and the creation of opportunities to improve the balance between life and work, particularly for women. Two of these reforms have been implemented through the recent Legislative Decrees Nos 22/2015 and 23/2015, and the others will be adopted shortly, in accordance with the legislative schedule. Emphasis should be placed on the “replacement contract” (section 17 of Legislative Decree No. 22/2015), which allows unemployed persons, after a “profiling” procedure in the public employment services, to receive a bonus related to their specific conditions of employability, by signing a replacement contract with private or public employment services. Under this agreement, the unemployed receive stronger and more intensive services to enhance their labour market integration. The contract is financed by the Fund for Active Labour Policies, in accordance with section 17 of Legislative Decree No. 22/2015. With regard to the establishment of a National Employment Agency, the aim of the reform is to improve coordination of labour market services throughout the national territory, implement active labour market policies (ALMPs) and create a stronger network of all bodies with competence in the labour market field. Act No. 183/2014 provides for the involvement of the social partners in defining the broad policies of the Agency. Italy has also adopted several measures (Act No. 92/2012, section 4(11)) to enhance the employability of women through the introduction of incentives to hire unemployed women (particularly the long-term unemployed or women living in areas with a high unemployment rate). Recently, a ministerial decree adopted in December 2014 identified a list of economic sectors and professions for 2015, based on ISTAT data, in which there is a high rate of employment disparities between men and women (over 25 per cent), with a view to the provision of incentives (in the private sector), in accordance with Act No. 92/2012. The main employment disparities are in industry (particularly construction, mining, waste management, energy and manufacturing), services (transport and warehousing, IT), as well as in the following occupations: the army, artisanal work, farming, the technical professions, engineers and entrepreneurs. The Stability Act of 2015 (Act No. 190/2014) also established a so-called “baby bonus” (€80 a month) for families on low incomes for each baby under 3 years of age. Finally, with a view to addressing regional disparities, a more rational use is being made of structural funds (the Action and Cohesion Plan).

With regard to youth employment, Legislative Decree No. 104/2013 introduces new instruments to strengthen career guidance in secondary schools and a pilot programme (through apprenticeship contracts) for students in the last two years of secondary school. The Youth Guarantee Programme was launched last year (1 May 2014) and, at the moment (4 June 2015), young people who join the Youth Guarantee Programme are 604,854, with a funding of €1.5 billion. The gender composition of the registered people is: 51 per cent male and 49 per cent female. Some 8 per cent of those registered are in the 15–18 age group, 53 per cent are in the 19–24 age group and 39 per cent are over 25. Among these registered young people, 329,656 have subscribed to the “service pact” and have been profiled (168,009 males and 161,647 females). This Programme has represented, for us, a new way to coordinate and manage the labour market services, to create a competitive–cooperative system between private and public employment services, taking into account the structural reforms we are dealing with in these fields, with the delegation law No. 183/2014 (Jobs Act). The Ministry of Labour and Social Policy has developed several measures and approaches to address youth unemployment, together with the regions. A website has been established for the Youth Guarantee Programme (www.garanziagiovani.it). A “profiling methodology” has been developed for young people to place them in a specific cluster and to direct them to specific and tailored measures (such as vocational training, traineeship, apprenticeship, civil service, self-employment or job incentives for employers). The regional activation plans contain specific programming of financial resources and active strategies for young people, including ongoing and future measures financed by the European Social Fund or from national/regional resources. Another important tool to enhance youth employment is the European Employment Services (EURES) Network, designed to facilitate the free movement of workers within the European Economic Area. Partners in the network include public employment services, trade unions and employers’ organizations. The main objectives of EURES are to inform, guide and provide advice to potentially mobile workers on job opportunities, as well as living and working conditions in the European Economic Area, and to assist employers wishing to recruit workers from other countries. In the context of the Employment and Social Innovation (EaSI) Programme, reference should be made to the “Your first EURES job” project, which supports work experience abroad for young people aged 18–35 (including apprenticeships, traineeships and job interviews). In line with the EU 2020 Strategy, the “Welfare to work” action system was implemented in 2012–14, including ALMP plans for the employment of young people, workers aged over 50, women and the unemployed, which are managed by the regions and provinces.

With reference to education and training policies, it should be noted that the general outline of the National System for the Certification of Skills was established by Legislative Decree No. 13/2013. As a precondition for access to the European Social Fund for the period 2014–20, and in compliance with the country-specific recommendation of 8 July 2014 (point 6), Italy has undertaken to continue the implementation of the National Directory, with the aim of developing a single reference for the recognition and standardization at the national level of regional qualifications. This commitment led to the adoption of an Agreement in the State–Regions Conference in January 2015, envisaging a system of operational references for the certification of regional vocational qualifications, by issuing the National Reference Framework of regional qualifications and establishing minimum standards for the validation and certification of skills. This agreement has been reflected in an Inter-Ministerial Decree issued by the Ministries of Labour and of Education. The cornerstone of the system is the establishment of the National Framework of Regional Qualifications, which serves to organize, aggregate and accord nationwide recognition to over 2,600 regional vocational qualifications. This system is based on the expansion of statistical classifications (economic activity and job classifications) involving a mapping of the labour market and of occupations. The descriptive approach adopted by the system will allow progressive extensions (vocational training, the education system, university degrees, vocational qualifications and apprenticeship profiles), as well as dynamic updates. The Directory is also a valuable tool for employment information systems, as it will lead to a more targeted and timely matching of labour market services. It also helps in the development of individualized active policy measures and the strengthening of lifelong training and geographical and sectoral mobility. The extensive use of statistical classifications provides a basis for enhancing the full and systematic interoperability of all of these measures with the employment information systems of other Member States of the European Union, OECD countries and the EURES network. Moreover, within the Youth Guarantee Programme, an inter-institutional working group has been established within the Ministry of Labour on the validation and certification of skills acquired in non-formal contexts, such as national civic service. With a view to increasing youth employment, through the Jobs Act Reform, the Government also intends to focus on measures related to work-based learning, particularly through apprenticeship contracts. More generally, the aim is to foster the use of such contracts by redefining: training provided both within and outside enterprises; training content and employers’ obligations; and the general criteria of apprenticeship in technical and vocational schools, with particular reference to the number of hours of schooling during apprenticeship. A specific legislative decree will be adopted to rationalize employment incentives, including apprenticeship. A reform was also introduced in 2013 in the field of adult education to reorganize adult education centres, which are now part of the Italian education system and can issue certificates and qualifications (Regulation No. 263/2012). In the field of education and vocational training, national standards have been defined for 22 qualifications (three years) and 21 diplomas (four years), described in terms of competences, in line with the provisions of the European Qualifications Framework. In recent years, the emphasis has been on improving tertiary education and higher technical education and training with a view to creating training supply that is more closely matched to the changing requirements of the labour market.

With regard to cooperatives, the Ministry of Economic Development in 2014 adopted several measures to promote employment through cooperatives. In particular, the Ministerial Decree of 4 December 2014 established a new incentive/fund to promote the creation and development of small and medium-sized cooperatives. The fund can be used to finance cooperatives established by workers from companies in crisis, cooperatives to manage companies confiscated from organized criminal organizations or the renovation of cooperatives in southern Italy

 

No. of cooperatives

Category	No. of cooperatives
Other types of cooperatives	8 960
Cooperative credit banks	394
Agricultural consortia	57
Cooperative consortia\federations	304
Credit unions and cooperative insurances	478
Fishing cooperatives	1 326
Agricultural and breeding production cooperatives	5 568
Consumers’ cooperatives	1 381
Retailers’ cooperatives	156
Farmers’ cooperatives	3 875
Worker–producer cooperatives	51 108
Transportation cooperatives	2 155
Housing cooperatives	10 585
Social cooperatives	21 650
Mutual aid societies	222
No category	1 539
Total amount	109 758
With "prevalent mutuality"	101 739
No "prevalent mutuality"	5 313
Last update: 26 May 2015

 

Région		Cooperative by region
Abruzzo		2 195
Basilicata		1 775
Calabria		3 849
Campania		11 612
Emilia Romagna		8 877
Friuli-Venezia Giulia		1 145
Lazio		16 226
Liguria		2 049
Lombardia		13 370
Marche		2 784
Molise		628
Piemonte	4 810
Puglia		9 138
Sardinia		4 119
Sicily		14 504
Tuscany		2 227
Trentino-Alto Adige		1 984
Umbria		1 225
Valle d’Aosta		299
Veneto		4 942
Total		109 758

 

The total amount of cooperatives has been significantly increasing for the past 15 years. In 2013, for instance, Italy had 106,970 cooperatives. Also the cooperatives with a positive impact on employment increased (worker–producer cooperatives, farmers’ cooperatives, transportation cooperatives, fishing cooperatives, 70 per cent of social cooperatives) 45 per cent in 2008, more than 65 per cent in 2015.

In addition, before the Committee, a Government representative referred to the written information and added that over the last five years Italy had faced a severe economic crisis, which had led to an increase in the unemployment rate up to 12.7 per cent in 2014. Young workers were the most affected by the crisis: in 2014 the unemployment rate of workers aged between 15 and 24 years was 42.7 per cent and the number of young people who were neither employed nor in education or training was 22.1 per cent. The Government further referred to the Fornero labour market reform which included the reform of the employment protection legislation, with the aim of reducing the segmentation in the labour market; the reform of the unemployment benefit system, whose coverage and coherence had been increased; the introduction of instruments for easing the transition between school and work; incentives for the employment of older workers and of women in areas with a high female unemployment rate or in sectors characterized by high gender gaps. Furthermore, the Fornero reform introduced a permanent system of monitoring, with the participation of the social partners and of all the institutions involved both in the implementation of the reform or in the collection and treatment of statistical data. The youth employment strategy provided for a package of interventions aimed at fostering the employment of young people, including an employment incentive, financial support for work experiences and incentives for self-employment and entrepreneurship; the youth guarantee programme represented a very important challenge and an opportunity to test a new approach to the provision of public employment services and active labour market policies, through the creation of a competitive and cooperative system between public employment services and private agencies, the development of a national “profiling methodology” in order to provide young people with more focused and tailored paths of placement, the introduction of standard costs at the national level and the results-oriented payment for labour market operators. The 2014 Jobs Act was the most ambitious of the three reforms giving the Government the power to reform many aspects of the labour market legislation, including the establishment of a national employment agency. In this respect, subsequent Acts had already been approved or would be adopted in the following weeks. A three-year contribution relief was established by Law No. 190 of 2014 for new open ended contracts, aimed at encouraging an employment intensive economic recovery with more stable jobs. Statistical data showed some improvement of the main employment indicators following the implementation of these reforms. The number of employed people increased by 0.7 per cent in April compared to March 2015. The employment rate reached 56.1 per cent while the unemployment rate fell to 12.4 per cent. During the first three months of 2015, the number of new employment contracts increased by 3.8 percentage points: the number of new open-ended contracts increased by 24.6 per cent with respect to the same period in 2014. With respect to youth employment, the latest figures showed an increase of 5.7 per cent in the number of employed people aged between 15 and 24 by March 2015. Their unemployment rate was currently 40.9 per cent, which was 2.4 percentage points lower than in April 2014. Concerning education and training policies, the Government representative indicated that, according to the National System of Certification of Skills, a national directory of qualifications was being implemented and that the Jobs Act reform focused on work-based learning, particularly through the reform of the apprenticeship contract. With regard to the data related to cooperatives, there had been an improvement in the number of cooperatives over the last 15 years, including cooperatives which had a positive impact on employment. Finally, the Government representative noted the importance given to the issue of monitoring, which would also be applied to the reform of active labour market policies. Great attention would be paid to the monitoring system and to the capacity of the public administration to learn from experience, through the continuous adjustment of measures and services.

The Employer members observed that the Committee of Experts had formulated since 1990, 16 observations on the implementation of the Convention. This was the first time that the Committee was able to discuss the case on the grounds of significant progress shown by the Government. Quoting Article 1 of the Convention, which required each member State to declare and pursue an active policy designed to promote full, productive and freely chosen employment, they recalled that the main problems regarding the Italian employment situation were related to regional and gender disparities, excessively high youth unemployment, as well as the high level of undeclared employment. These problems were rooted in structural causes and persisted irrespective of the prevailing economic situation, which was also reflected by the Committee of Expert’s comments over the past 25 years. The profound economic crisis of 2008, which had affected all European countries, posed particularly tough challenges to the Italian economy and the employment situation. Although the labour market institutions were not the cause of the crisis, their shortcomings and inefficiencies, including excessive bureaucracy, contributed to the aggravation of the crisis and hence hampered both employment generation and economic recovery. In addition, the inefficient labour court system, where legal disputes were decided only after several years, discouraged employers to offer open-ended contracts to workers. The same deficiencies were observed in public employment services which therefore were not able to fulfil their role in active labour market policy. Likewise, the vocational education and guidance system was not able to fully integrate young people in the labour market. In order to tackle these problems, the Government had undertaken comprehensive structural reforms of the institutions which were relevant to the employment and labour market, in order to make them more efficient and conducive to employment creation. The 2012 Forneo labour market reform, the 2013 Youth Plan and the 2014 Jobs Act followed exactly the comprehensive approach required. The 2014 Jobs Act, in particular, made the labour market regulations more employment-friendly, which led to the creation of a new form of open-ended employment contracts with better protection rights. This measure was accompanied by a reform of the work-based vocational education and apprenticeship system, which was crucial for increasing youth employment. The public employment system had also been reformed and measures aiming to reconcile work and family life had been introduced to promote the integration of women in the labour market. The Employer members stressed that structural reforms always needed time until positive effects became visible. Already, the first positive effects had been noted, such as the significant increase of employment, including youth employment. Also, the employment of women was growing faster than the employment of men. Most importantly, the number of open-ended employment contracts had increased significantly since the adoption of the Jobs Act. Turning to the provision of Article 3 of the Convention which provided for consultations on employment policies with the representatives of the persons affected by the measures and in particular representatives of employers and workers, they observed that the Government had been discussing the measures proposed with the social partners for a number of years. However, at a moment when the employment situation deteriorated severely, the Government had rightly assumed its responsibility and had proposed a draft legislation which was in line with the recommendations of the European Council within the framework of the European Semester. The social partners were consulted during the deliberations in Parliament and gave their views on the reform package which was subsequently adopted by Parliament. The implementation measures of the reform were under preparation and subject to broad consultations with the social partners. In this regard, the Employer members hoped that the opponents of the modernization of the labour market would give up their negative attitude and that both social partners would participate in a proactive manner in the consultations. In conclusion, the Employer members praised the Government’s comprehensive structural reforms, since they contributed to the goals of the Convention and reflected the spirit of the 2008 Oslo Declaration which called for decent work and job creation to be fostered through an enabling environment for enterprises and appropriate strategies to enhance competitiveness and sustainable development. The employment gaps regarding regions, gender and youth could require a long time to be resolved. However, they reiterated that the comprehensive approach was showing its first positive effects and the Government should hence continue on this path of reforms.

The Worker members recalled the objective of full, productive and freely chosen employment, based on consultations with social partners and the importance of other key documents on which consensus had been reached, such as: the Decent Work Agenda; the 2008 Declaration on Social Justice for a Fair Globalization; the Tripartite Consultation (International Labour Standards) Convention, 1976 (No. 144); the 2009 Global Jobs Pact; the 2010 ILC Resolution concerning the recurrent discussion on employment; and the 2008 Oslo Declaration. Beyond the existence of a framework, the Employment Policy Convention, 1964 (No. 122), required initiatives on the part of the Government. The Committee of Experts was empowered to assess whether the measures taken would affect employment in a way that was compatible with the objectives of the Convention. Recalling the conclusions adopted in 2013 during the previous examination of this case, as well as the ensuing comments by the Committee of Experts, the Worker members considered that the problem of the present case lay elsewhere, as most of the data had changed since the Italian Government had passed a series of new laws and decree laws in order to reduce unemployment. The Jobs Act, which had been adopted in 2014, without proper consultation of the social partners, in order to increase the employment rate, was the third reform of the labour market in three years, even though the impact of the previous reforms had not necessarily been evaluated. The provision of information was not the equivalent, however, of holding consultations within the meaning of the Convention, which required timely consultations, thus allowing for exchanges to take place, compromises to be reached and amendments to be discussed. Labour law was not there to serve the market, as underlined by the Declaration of Philadelphia. Yet, the latest reform had provided for complete liberalization regarding fixed-term contracts, as they could be extended to 36 months; had introduced the concept of downgrading, which allowed for workers to be assigned tasks at a lower grade than the one at which they had been hired; and had authorized the use of contracts for part-time employment with greater flexibility regarding working hours and casual work for all task types. In the case of apprenticeships, the reform had ended payment for training hours. Finally, it introduced “contracts with increasing protection”, which was a source of concern for the trade unions. In the absence of consultations, which would have clarified any doubts and would have allowed for adjustments to be made, the workers were faced with a fait accompli whereby labour law had been undermined. The Government was considering work, wages and social protection in the broad sense, as nothing more than another factor in its budgetary orthodoxy, thereby going against the Declaration of Philadelphia on which the Convention was based. The latest data submitted were not surprising, as many jobs in the country were seasonal, which was reflected in the extensive use of fixed-term contracts. A correlation should be made between this data and the fact that enterprises received subsidies for three years. Questions should be raised regarding the sustainability of that temporary assistance with regard to employment. There was a high risk of damaging the cohesion of a country that was already experiencing economic and social imbalances among its different regions and a high unemployment rate for women. Although the Government had high hopes for the Youth Guarantee of the European Commission, the scheme had limited resources and would not be enough to resolve the problem faced by all young people, who also needed to be guaranteed a quality transition between school and work. In conclusion, the Worker members said that they shared the concerns of Italian workers, who feared a resurgence in precarious employment and growing poverty even within the world of work. The way out of the crisis lay in the creation of more quality jobs and in greater efforts to train workers.

The Employer member of Italy indicated that the environment was different from that of 1964 when the Convention had been adopted. Globalized economies, technological and demographic change and different ways of production as well as new requirements for workers and enterprises had transformed the labour market. However, the objectives of the Convention remained valid and needed to be pursued, as active labour market policies to promote growth, employment, social development and cohesion were more necessary than ever. Governments and social partners had to be committed to adopt reforms to adapt the labour market to the situation. In this regard, it was encouraging to examine countries that were now positively addressing the challenge, in particular Italy, where structural reforms of the labour market had lagged behind for years. The alarming figures concerning employment, in particular women and youth employment, could be explained by the delay in addressing the structural weaknesses of the economy and of the labour market which had been exacerbated by the crisis. Now some improvement in latest figures must be highlighted, particularly with regard to the creation of permanent employment. In any case, it had to be recalled that Italy remained behind other EU countries in the use of fixed-term contracts, and was the country where temporary agency work benefited from full equal treatment in comparison with permanent employment. The Jobs Act implemented by the Government contained a package of reforms that simplified and modernized the employment relationship and reinforced active labour market policies, overcoming rigidities that discouraged job creation. A regulatory framework that fostered employment together with policies that encouraged investment could contribute to recovery. Social partners had an active role to play in this strategy and they had the opportunity to channel their views through the existing institutions, including the Parliament. They could also contribute to the modernization of the labour market through collective bargaining which, even during the crisis, had contributed to finding balanced solutions to protect employment and support competitiveness. The results already achieved should encourage the Government to adopt further reforms within the framework of the Convention.

The Worker member of Italy said that the Jobs Act, which was designed to help increase the rate of employment, was the third labour market reform in as many years whose impact had not been assessed and whose global vision was inadequate. The increase in precarious work stemmed from the 2003 labour market reform, and from the process, which since 1993 had been proclaimed as “the modernization of the labour market”, and job creation. Yet the Jobs Act was geared more towards job flexibility than job security; it looked upon open-ended contracts as providing “increasing protection”, but in practice it replaced the current system under which workers were protected against illegal dismissal. In future, even in the case of unjustified dismissal, workers would only be entitled to financial compensation, but not to reinstatement. The amount of compensation for dismissal increased only with the number of years of service. As a result, the balanced system of professional relations that had existed before was being replaced by the monetization of labour and of its value, in breach of Article 24 of the European Social Charter and of the Termination of Employment Convention, 1982 (No. 158), which stated that all terminations must be justified. In the past, reinstatement in a job following an illegal dismissal was a policy choice that protected workers’ dignity and enabled them to lay claim to other fundamental rights. The concern was that the new measures might put undue pressure on workers and lead to employment blackmail. Recruitment that took place in 2015 would exempt employers from social security contributions for up to 36 months, after which the maximum would be €8,060 a year, regardless of whether the enterprise had invested in training, innovation or research. The reform had been designed to benefit enterprises. The long-term sustainability of that kind of recruitment was doubtful, because it did not result from structural change, and there was therefore a risk that precarious work would become institutionalized. According to the OECD, Italy’s 49 per cent youth unemployment rate was the highest in Europe after that of Greece, and there was still a long way to go before Italy might find a sustainable answer to the crisis. The increased productivity that the reform aimed to achieve was largely dependent on employers being able to dismiss workers more easily. That was all to the employers’ advantage, because they could then hire new workers more cheaply and benefit from tax and social security concessions. Meanwhile, nothing was being done to retrain workers by means of sustainable measures for improving their employability. None of the teaching and training measures that should have been introduced since 2013 had been implemented, and the permanent territorial centres in provincial adult education institutions had never been set up. The system was under-financed and the Government had done little to implement the measures. A job without rights was no job at all. Yet that was exactly what was happening; inevitably, then, the world of work would go into economic and social decline. In southern Italy some 800,000 jobs had been lost between 2004 and 2014 and more and more workers (700,000 between 2011 and 2013) were migrating to northern Italy. Surely Italy needed, instead, an ambitious public and private investment programme that might give the country a real chance of economic growth based on quality jobs. The very first words of the country’s Constitution stated that Italy was a democratic republic founded on work, which was the foundation of life and the principle means of social inclusion – a concept that must be translated into respect for the dignity of all.

The Government member of France, also speaking on behalf of the Government members of Croatia, Cyprus, Germany, Greece, Luxembourg, Portugal, Romania, Slovenia and Spain, said that, like Italy, the Governments of all the aforementioned countries had embarked on a coordinated approach at EU level designed to combat unemployment in a difficult context for public finances, with a view to reducing an unprecedented unemployment rate, ensure strong and lasting growth and strengthen social cohesion. The Europe 2020 strategy for smart, sustainable and inclusive growth, which defined the macroeconomic direction of the EU, was based on the same objectives and aimed for a 75 per cent employment rate for the 20–64 age group and the possibility for every person to seize opportunities, develop skills in order to be able to find a job, be educated and trained, and enjoy social protection corresponding to the various risks encountered throughout life. Poverty at work remained an issue to be faced by the member States, and developing access to employment remained a significant challenge, particularly for women and vulnerable groups. The search for the right balance between macroeconomic objectives, on the one hand, and those of inclusive growth, on the other, and also the creation of an environment conducive to the development of investment merited closer attention, as recommended by the European Commission’s recent investment programme. Better use of human capital through more inclusive labour markets should contribute to growth and social progress. In view of their representativeness within social Europe, trade union and occupational organizations at the European level had a particular role to play, especially in the social and employment spheres. Italy was pursuing active policies to achieve full, productive and freely chosen employment and the Government should be trusted to continue its efforts in that direction, in accordance with the values and principles of the ILO. Furthermore, without social dialogue there could be no lasting solution to the problems of the labour market in Europe. The ILO had to play its full part in integrating the social dimensions of international labour standards in the multilateral system through increased collaboration with other international bodies, particularly those in the economic and financial spheres.

The Worker member of Canada indicated that in the framework of the proposed trade agreement between Canada and the EU, under the guise of promoting full employment, both countries were promoting a labour market flexibility agenda characterized by deregulation or reregulation to lower or keep wages low, stimulating private investment and promoting export demand. Even if it was sometimes said that approaches like the Jobs Act had resulted in reducing unemployment, a closer look at the statistics revealed a picture that was characterized by more short-term work, precarious work, more inequality, less social stability, higher job insecurity and lower social protection – a scenario that went contrary to the principles of the ILO Decent Work Agenda. In both countries, there was no consultation or meaningful involvement of the social partners with regard to key employment plans. While Italy was breaking with a long tradition of consulting social partners about employment, Canada had now launched frontal attacks to freedom of association and collective bargaining. It appeared that the purpose of the Convention had been sidelined without regard for a meaningful employment policy and without dialogue with the social partners.

The Employer member of Spain stated that, like his country, Italy had suffered the economic repercussions of the 2008 crisis, resulting in a slowdown in economic growth and the loss of employment, along with an increase in structural inequalities that had existed before the crisis. Within the framework of the Stability and Growth Pact, the Italian Government had taken significant steps to overcome those difficulties. Although labour reform alone could not solve employment problems, together with other reforms it represented a key piece in building a vigorous recovery in the job market during the next ascending economic cycle. The Spanish employers supported the reform and advocated the adoption of additional measures to remove the unnecessary rigidity from the job market and create a favourable environment for enterprises to create high-quality jobs. The Jobs Act, among other measures taken by the Government, reflected its firm commitment to reactivating employment creation.

The Worker member of France recalled the particularly worrying rate of 42 per cent youth unemployment in Italy, the particularly dramatic employment situation in the south of the country, the fact that most young people were liable to end up in precarious jobs in new forms of semi-contractual employment, and the lack of career prospects even for those with qualifications; and that was despite the measures taken by the Government with respect to apprenticeships, which the social partners and the Government saw as the best way of getting workers back into the labour market. However, the new labour market reform, which had introduced “assisted” contracts that offered enterprises tax concessions for three years, meant that employers no longer hired workers on apprenticeship contracts and thereby denied young people access to training programmes. Moreover, the number of young people benefiting from such contracts was already declining, and nobody knew what would happen after the three-year exemption period. Only 20 per cent of jobseekers had found their way back into the world of work. The youth unemployment problem was not just a question of resources, since the EU had given Italy substantial financial assistance; it was more a matter of priorities in the distribution of available resources. The Workers were therefore calling for a genuinely active job-creation policy which favoured enterprises that invested in training, and which strengthened employment services. It was also necessary to familiarize young people with the world of work and enterprises through the promotion of civilian service and training.

The Employer member of France indicated that, owing to the severe economic recession, Italy had had to introduce major labour market reforms, such as the Jobs Act, in order to address the high rate of unemployment. In particular, the country had adopted the Fornero Reform establishing a range of measures to protect the working conditions for women and young people, boosted apprenticeships and vocational training and implemented the youth plan, which had been converted into a law in accordance with the 2020 Strategy, and measures to address the mismatch between labour supply and demand which aimed, for example, to improve the employability of older unemployed persons and their reintegration into the labour market – with specific measures for women. In 2014, the employment services had been reformed and the National Employment Agency had been established. Emphasis had also been placed on training with the reorganization of adult training centres, which were now part of the national education system, and on improving the quality of higher and technical education so as to adapt it to the changing labour market. Also in 2014 the Ministry of Economic Development had adopted measures to promote employment through cooperatives and the development of small and medium-sized cooperatives. In conclusion, she said that Italy should be encouraged to continue the efforts it had already undertaken, in accordance with the Convention, to reduce unemployment with a view to full employment.

The Worker member of Brazil recalled the importance of the Convention, the main objective of which was to give expression to the principles set forth in the Declaration of Philadelphia relating to full employment and social justice. The Convention promoted the creation of employment through the adoption of growth and economic development policies and obliged States to implement policies that tackled the problem of unemployment and underemployment. The application of the Convention in Italy had been hampered by the restrictive economic and social policies promoted by the European Commission. In that context, the Jobs Act had been adopted at the end of 2014 creating new forms of employment contracts and making it easier to dismiss workers. The measures recommended by the European Commission, known as specific recommendations for each country, showed that the ills of low productivity and competitiveness of Italian enterprises were regarded as stemming from excessive social protection of the employment relationship. However, reality showed that enterprises were not hiring more workers just because it was easier to dismiss them but also because there was an economic policy geared to economic growth and with it the expansion of business. Even though initial data showed a slight reduction in unemployment, it was important to be aware of the effects that flexibility policies had had in Latin America where they had been extensively applied. In the long term, making dismissals more flexible, creating incentives for part-time contracts and making use of outsourcing resulted in the creation of precarious jobs or underemployment, in complete contradiction with the Convention. It was certain that workers’ lives could not be improved in the long term if no macroeconomic policies were adopted aimed at economic growth based on investment technological innovation wage increase or state investment.

The Employer member of Turkey indicated that the comments of the Committee of Experts gave a misleading picture of the situation in Italy and that the evaluation of the situation should not be based solely on quantitative analysis. The profound economic crisis had greatly damaged the Italian economy and labour market, and the response of Italy had been bold and responsive. The structural reforms in areas such as vocational training, apprenticeship, public employment services, employment contracts and flexibility had been undertaken in a consistent way. These measures showed a clear commitment to overcome the crisis through policies for employment creation. Positive effects could already partially be seen, but more time was needed to achieve success. The Turkish employers welcomed the progress made by the Italian Government and its commitment to comply with the Convention.

The Worker member of Belgium referred to the impact of the crisis and the austerity measures on women’s jobs and lives in Italy. Young women, even those who were highly qualified, were limited to precarious and unstable work and women over 40 years had difficulty situating themselves satisfactorily on the labour market. According to the 2014 European Commission annual report on equal opportunities, if Italy did not radically change its employment policy, it would only achieve its objective of a female employment rate of 75 per cent in 30 years’ time, equality of treatment between men and women would only become a reality in 70 years’ time, and parity representation in national Parliament would not be possible before 20 years. The rate of male employment was 22 per cent higher than the employment rate for women, while the average for this gap in the EU was 12 per cent. Women left the employment market because certain types of contracts did not offer them adequate maternity protection. In addition, the practice of “white resignations” was common, under the terms of which, at the time of her recruitment, the woman worker signed a resignation letter which the employer would use if the worker was pregnant or on maternity leave.

The Employer member of Belgium highlighted that, in the financial and economic crisis that had swept Europe since 2008, there was one common objective: restoring economic growth so as to create sustainable employment; and that necessarily entailed the structural reform of the labour market. The reforms, which had sometimes been trying, were at last beginning to bear fruit. Governments had tackled the countries’ structural shortcomings with determination and had regularly, if not constantly, consulted the social partners before adopting and implementing new measures. There were of course differences of opinion among the social partners on the proper steps to take, especially when they were unpopular; and in the absence of consensus the Government was obliged to take the final decision. The requirement in Article 3 of the Convention that the Government consult the social partners on its employment policies was not intended to undermine the sovereignty of States, and governments had to pursue whatever structural reforms were necessary to protect the competitiveness of enterprises and to sustain employment and, therefore, the social security system. He concluded by asserting that government practice in Italy was in keeping with the Convention.

The Worker member of Poland, observing that the Italian labour law reform had resulted in a reduction of workers’ rights, focused on the situation of the most disadvantaged children. Child labour could become a reality within the EU as a result of the austerity measures which had a great impact on vulnerable groups through the reduction of family incomes and cuts in state expenditures dedicated to health care, education and social services. Italy had one of the highest rates of school drop-outs in Europe. A 2013 survey from Save the Children pointed out that, at least one out of 20 children was exploited. In October 2011, the UN Committee on the Rights of the Child urged Italy to develop effective mechanisms capable of ensuring children’s education, health and social assistance, and called for a comprehensive analysis on resource allocation for this purpose. In this context, the Government should have considered the implementation of free universal education as a priority for the creation of new quality jobs and public investments for development and growth of the country. Those considerations should be central in the international community and EU policy debate in order to finally break the chain of decent work deficits, poverty and inequality.

The Worker member of Germany observed with concern that the recent labour market reforms of the Government were socially imbalanced, and that they had fatal consequences for the economy and society. While the Government faced challenges to overcome the economic crisis that had resulted in the loss of thousands of jobs, there was real doubt as to whether the Jobs Act would achieve economic growth and development, increase living standards and reduce the unemployment rate. The Jobs Act had introduced a new contract with additional safeguards replacing the previous open-ended standard employment contracts. Consequently, judicial procedures against employment termination for economic reasons would now become more difficult. Where employment contracts had recently been concluded or where enterprises employed more than 15 employees, there was no right of reinstatement, except where the courts considered the dismissal to be discriminatory. Furthermore, the amount of compensation for unfair dismissal had been significantly reduced, including in the event of collective dismissals. Section 18 of the Italian workers’ statute which previously provided for the protection of workers organized in trade unions against unfair dismissal had been undermined, which was tantamount to interference in freedom of association. The introduction of the new contract with additional safeguards meant that enterprises could simply realize unfair or collective dismissals by paying a meagre compensation. There were concerns that other regulations under the Jobs Act would provide for further precarization and the widening of the gulf between different categories of workers. While it had appeared from some of the statements made during the discussions that the regulations on the protection against dismissal were the main cause for the labour market crisis in Italy, there was very little evidence to support this belief. In fact, countries with the highest protection against unfair dismissal were more economically successful and had higher employment rates than others. He concluded by stating that the Government should have consulted workers in the early stages of the reform process, and that it should also take into account social objectives in its efforts to promote employment.

The Worker member of Japan, referring to the Director-General’s Report to the Conference, indicated that work should contribute to overcoming social problems through connecting people and making a link between workplaces and society. However, such linkage was becoming weaker and weaker because of the increase in precarious work and the deterioration of the quality of employment. Although the crisis represented a chance to recognize the importance of stronger coherence between growth strategies and employment policies, few lessons had been learnt from it as the policies being implemented all over the world had demonstrated, including in Italy. The Jobs Act instilled more flexibility in the labour market, removing constraints faced by employers in hiring and firing workers through a redefinition of company sizes, the establishment of new rules on fixed-term contracts and a revision of section 18 of the Italian workers’ statute that prevented companies from downsizing during a crisis. Such measures would be surely creating more jobs but most of them would be precarious leading to a vicious cycle of, among others, insecure and lower waged jobs; decrease of savings; even lower consumption; no investment and stagnant growth. In order to stop such a deflation spiral, investments should be made to create decent jobs and employment policies should aim at the strengthening of workers’ protection and the raising of wages. Finally, despite the provision in Article 3 of the Convention, in many countries, consultation with enterprises was often given priority over that with trade unions. Without proper consultation of workers’ representatives, measures would not be effective or beneficial to those at whom they were targeted

The Worker member of Argentina stated that Italy’s labour reform had ushered in a process that had been described as a “labour counter-reform” because of its regressive nature in terms of protection for a considerable number of the rights and guarantees that Italian workers had acquired during the 1950s. The “counter-reform” was the fruit of the employers’ and Government’s mistaken belief that restricting rights and increasing the power of employers would raise employment levels. However, reality showed a different picture: unemployment in Italy had reached extremely high levels, especially in the south of the country, and affected women most acutely and young people to an alarming degree. In addition to seriously affecting the stability of labour relations by abolishing reinstatement following “unlawful economic dismissal”, the reform had undermined the worker protection system through the revision of section 2103 of the Civil Code, which made it impossible for an employer to assign a worker to lower-level functions than that at which the worker had originally joined the enterprise. Since the reform, the opportunities for potential abuse by employers had increased dramatically, as not only could they now assign workers to inferior duties, but there were also restrictions on the judicial power to redress the balance in cases where it was alleged that the assignment of hierarchically inferior tasks was excessive in view of the enterprise’s actual economic position. Moreover, all reference to the employer’s duty to assign equivalent functions to subordinates had been removed, with the result that determining which services a worker performed was now left to the completely arbitrary choice of the employer, regardless of the worker’s particular skills and abilities. The consequences of this for the dignity of workers were incompatible with the Convention and the 1944 Declaration of Philadelphia.

An observer representing Public Services International (PSI) stated that the reform of the public employment system via the establishment of the National Employment Agency had resulted in the abolishment of more than 550 centres for employment. This had led to employment uncertainty for more than 8,000 workers and to a vacuum in employment services. A flood of cuts in public spending was hitting public services severely. She recalled that spending cuts involved the abolition of the State Forestry Corps, whose function would be assigned to other police corps, which were already dramatically understaffed and underfunded. The health sector represented 14 per cent of total public spending; in 2015, 2,069 hospitals and 8,718 first-aid services were closed along with several centres for emergency services. Such spending cuts would lead to fewer jobs, more overtime and less safety for patients. Furthermore, 3 million public service workers had had their last wage increase in 2008. Since then, wages had been frozen, collective bargaining suspended until 2018 and no mechanism to compensate the increase in the cost of living had been foreseen. The Constitutional Court was expected to decide whether the practice of freezing wages during a time frame of ten years was compatible with the Constitution and a verdict of incompatibility would lead to a payment to all public employees of €35 billion, corresponding to the past seven years. Finally, recalling that employers were on the one hand supporting flexibility and flexicurity and, on the other, questioning the role of the Committee of Experts and ignoring trade union arguments, she warned that workers were tired of being exploited and that, in a world embroiled in social and political conflicts, such a discontent could lead to very dangerous consequences.

The Government representative addressed some of the questions raised during the discussions. In relation to social dialogue, he reiterated that the social partners had been permanently involved: they had been heard by Parliament in relation to the various aspects of the Jobs Act; they had been involved in the relevant contractual arrangements which had been left to collective bargaining; they had been consulted in relation to labour market policies through their involvement in the governance of institutions, including the new national agency for active labour market policies and the Italian National Security Institute. Moreover, the social partners had been involved in the management of labour market policies, through the management of the newly introduced solidarity funds in the event of the reduction or suspension of labour activity. Finally, the social partners had also been in charge of international bilateral funds for the training of employees. However, it was the Government that had to bear the responsibility for the functioning of the labour market and the economic recovery, and therefore had to adopt the reforms that it deemed necessary. He then addressed the issues concerning the Youth Guarantee. This strategic plan was not an extraordinary programme that had been intended for just a couple of years, but was indeed intended as a pilot project to introduce a new approach for public employment policies and active labour market policies. This programme had been co-financed by the European Social Fund, and it was expected that a more permanent and stable source of financing would be provided by the EU. Referring to the need for community service in order to maintain the competencies of workers that was raised during the discussion, he indicated that traineeships, training and employment were part of the strategic plans relating to the Youth Guarantee. He emphasized that the public employment services had not been abolished, even though in view of the administrative reform, employment services were no longer represented at the provincial level. In fact, the support of the regions was crucial to address youth unemployment, in the framework of the Youth Guarantee programme. In relation to the issue of fixed versus open-ended contracts, he indicated that the success of the Government strategy lay in the numbers. There had been an increase of about 24 per cent in the number of new open-ended contracts in the first three months of 2015 in relation to previous years. It was better to provide for economic incentives than for strict legislation that was difficult to implement. The Government was committed to fostering open-ended contracts with a long-term perspective. In relation to the protection of workers, he recalled some of the numbers from the OECD employment protection legislation indicators. A calculation in relation to employment protection legislation had been made after the adoption of the Fornero policy reform. In 2013, Italy had an index of 2.79 for the protection of permanent workers against collective dismissal, which was higher than the OECD average index, which was 2.29. Concerning the regulation on temporary employment, Italy had an index of 2.71, whereas the OECD provided for an average index of 2.08. Concerning female employment, while there had been a decrease in the total employment during the crisis, when breaking down this number, it had become clear that the female employment rate had risen.

The Employer members indicated that it was important to recall that employment could not be created by Decree, but that it depended on economic conditions. Therefore, the Government was to be commended on addressing the regulatory barriers for entry into employment, where these barriers had been found to be excessive or to have long-lasting negative effects on employment. They were surprised to hear the criticism concerning the new employment contract introduced under the Jobs Act that removed the possibility for reinstatement in case of dismissal, but enhanced compensation rights. In fact, most EU Member States provided for similar regulatory frameworks, and it could not be seriously claimed that workers in all these countries were exploited and pushed into precariousness and badly paid jobs. The Government had demonstrated significant progress in complying with the objectives of the Convention by adopting and currently progressively implementing a comprehensive package of measures addressing structural weaknesses concerning employment. The Government should continue its comprehensive approach to structural reform in order to improve the employment situation and foster job-rich inclusive growth. Given that the Jobs Act, which was the key component of the reform package had only recently been adopted and considering that structural reforms always took time to reveal their results in terms of the employment situation, they considered that the Committee should continue to evaluate the implementation of that Act based on updated labour market data. Therefore, the Government should provide a detailed report to the Committee of Experts on the application of the Convention in 2015.

The Worker members expressed their satisfaction that the Employer members had emphasized the relevance of the Convention in the current crisis, the importance of the Committee examining its implementation and the need to assess employment policies from the qualitative as well as the quantitative standpoint. As to the soundness and necessity of the structural reforms, obliging the workers to make all the efforts and sacrifices amounted to making them carry the cost of a crisis for which they were not to blame. It was also surprising that some speakers were all for leaving the problem to the State and abdicating their own role as social partners in the context of social dialogue. Given the risk of a return to precarious employment and increasing poverty, the best solution to the crisis was to create more quality jobs and improve the level of training. However, since the measures taken thus far by the Government were likely to offer only short-term solutions, it was essential that, for the Committee of Experts’ next session, the Government continued to provide relevant data on: the outcome of the reforms undertaken to combat high unemployment, long-term unemployment and youth unemployment, especially through the creation of sustainable quality jobs; the simplification of types of contract and the number of permanent contracts benefiting from public funding; the development in women’s employment and the fight against the disparities in employment from one region to another; the review of policies and measures to attain the objectives of full, productive and freely chosen employment; the promotion of productive employment through cooperatives. The Government should also make every effort to revive and strengthen social dialogue.

Conclusions

The Committee took note of the detailed written and oral information provided by the Government representative and the discussion that followed in relation to the issues raised by the Committee of Experts related to employment policy measures to alleviate the impact of the crisis adopted in 2012–13 and which included: the monitoring of the measures implemented with the participation of the social partners; the high unemployment rate which reached 12.6 per cent in May 2014 and affected young people by a greater proportion; the continued differences in employment rates between northern and southern regions of the country, as well as the measures taken to promote productive employment through cooperatives.

The Committee noted the information provided by the Government representative indicating that the unemployment rate had been reduced to 12.4 per cent in April 2015 and the rate of unemployed young people aged 15–24 who were actively seeking employment had fallen to 40.9 per cent. The Committee also noted the information provided on the 2015 Jobs Act which included the establishment of a National Employment Agency, the revision of unemployment benefits as well as new provisions on the dismissal and reinstatement of workers, leading to an increase in the number of new open-ended contracts by 24.6 per cent with respect to the same period in 2014. More than 600,000 young people had joined the Youth Guarantee Programme launched in May 2014. The Government representative also reported on an Agreement reached between regions in January 2015 envisaging a National Framework of Regional Qualification to coordinate nationwide recognition to over 2,600 regional vocational qualifications.

Taking into account the discussion, the Committee requested that the Government:

■  ensure, in consultation with the social partners, a comprehensive approach to employment policies in order to improve the employment situation and foster job-rich inclusive growth, in line with the Convention;

■  ensure tripartite consultation on the development and implementation of employment policies, based on regularly updated labour market data, including on the number, kind, duration of employment, and youth and gender issues and regional disparities;

■  examine the measures to promote productive and sustainable employment through cooperatives; and

■  provide a detailed report to the Committee of Experts in 2015 on the issues raised in these conclusions.