Italian Labour Law - Non Competition Remuneration is a Part of a Salary

The Court of Milan, Labour Section, in a recent judgement, not published as yet, confirmed the direction of INPS (the Italian Social Security Office) in its decision in favour of considering the payments of moneys provided for by a non-competition agreement between employer and employee, in accordance with article 2125 of the Civil Code, as part of the salary and not as payment in compensation.

Therefore, according to the doctrine established in the above mentioned decision, which extends to such payments the principle of full inclusivity of remuneration A in whatever form and on whatever terms it is granted during the period in which the employment is in force A should be considered part of the amount on which social security contributions are to be calculated, and on which employee's income tax is to be paid directly by the employer.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.