(Reuters) – Italy’s right-wing government was set to unveil measures to boost jobs and workers’ pay on Monday, amid hostile reactions from unions and opposition parties over parallel welfare cuts and looser rules on short-term job contracts.
The package will make it easier for firms to offer job contracts lasting between 12 and 24 months and will scale back a “citizen wage” poverty relief scheme introduced in 2019 by the end of the year, according to some drafts seen by Reuters.
Rome has also earmarked around 3 billion euros ($3.30 billion) for a temporary reduction in the so-called tax wedge, the difference between what an employer pays and what a worker takes home, but only for employees with an annual income of no more than 35,000 euros.
Amid government pledges to address a national birth crisis, the decree waives taxes on fringe benefits for employees with children, up to a maximum of 3,000 euros per worker.
Maurizio Landini, head of the main Italian union CGIL, said on Sunday that approving the measures on May 1, International Workers’ Day, was an “act of arrogance”. Prime Minister Giorgia Meloni replied that “there are many people working on May Day”.
While the government backs greater labour market flexibility, Elly Schlein, leader of the opposition Democratic Party, told La Stampa newspaper on Monday that the proposed measures would “condemn” workers to job insecurity.
Meloni, due to chair a cabinet meeting on the labour package later on Monday, has also made it a priority to slim down “citizen wage” payments, with the stated goal of encouraging able-bodied people to look for work.
With the reform, subsidies for poor people in the 18-59 age group will be cut to 350 euros a month, from a current average of around 550 euros per family, limited to a maximum duration of 12 months and subject to participation in job training schemes.
Poor households with minors, pensioners or disabled people will be eligible for slightly more generous payments of more than 500 euros a month, for a maximum of 30 months.
A further tax break, valid until December, is designed to encourage entrepreneurs to hire young people who are neither working nor studying.
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