Contributions
The periods are covered by notional contributions and count towards your pension.
CAF services · Income support
Cassa integrazione (furlough scheme)
Your employment does not end: it stays in place, with your work suspended or reduced and an income top-up paid for by INPS (the Italian social security institute). The practical problem is not your entitlement, it is the tax adjustment the following year.
01 · The tools
The forms of wage support
Under the common name of cassa integrazione sit several different tools, which differ by reason, length and the sector they apply to.
- The suspension can be total or on reduced hours.
- The employment continues: there is no dismissal and length of service keeps building up.
- The application is made by the employer, not the worker.
- Each tool has maximum durations and overall limits over a rolling five-year period.
- The employer pays an additional contribution that increases with use.
| Tool | When it is used |
|---|---|
| CIGO (ordinary) | Temporary events not attributable to the business: lack of orders, weather events, breakdowns |
| CIGS (extraordinary) | Reorganisation, company crisis, solidarity agreement |
| Solidarity funds | Sectors not covered by the ordinary scheme, under the rules of the relevant fund |
| FIS | The wage support fund, for employers who do not fall under the other tools |
| CISOA | The specific scheme for farm workers |
The application is up to the employer: the worker cannot trigger it or choose it. What the worker can and should do is check that the top-up is actually granted and paid, and that the periods appear correctly in their own INPS contribution statement.
02 · The amount
How much you receive
The top-up is a percentage of the pay you would have received for the hours not worked, within a ceiling that is revised every year.
- It is calculated on the hours not worked, not on your whole pay.
- It equals a percentage of the total pay you would have received.
- A monthly ceiling applies, revised every year, which reduces the amount for higher earners.
- A contribution deduction borne by the worker is applied to the amount.
- Public holidays and some other items are treated in their own way.
- Company-level agreements may provide for top-ups paid by the employer, which are added on.
Why you get less than you expect
There are three reductions that add up.
- The percentage, which is lower than 100% of your pay
- The ceiling, which cuts off the excess for middle and higher incomes
- The contribution deduction borne by the worker
- On top of which comes the tax effect the following year
03 · Payment
Who pays and when
There are two methods, and for the worker the difference lies mainly in the timing.
Payment by the employer
This is the ordinary method: the employer advances the top-up in your payslip and recovers it by offsetting it against contributions. The timing is the same as your normal payslip.
Direct payment by INPS
Authorised when the employer has documented financial difficulties. INPS pays directly into the worker's account, and it takes longer.
The SR41 form
With direct payment, the employer has to send INPS the data it needs: without it, the payment does not go out.
The advance
In some cases an advance of part of the amount is available, to shorten the wait.
With direct payment, delays almost always come from the employer failing to send the data, or sending it late, not from INPS. It is the first thing to check when the money does not arrive: the worker can see the status of the claim in their own social security file.
04 · What changes
The effects on your employment
Cassa integrazione affects a number of entitlements, and not always in the way you might expect.
TFR
It keeps building up on the hours not worked that are covered by the top-up. See the TFR (the Italian severance pay).
Holidays and leave
Accrual may be reduced in proportion to the hours not worked, depending on the applicable collective agreement.
Thirteenth-month pay
The share relating to periods of total suspension follows its own rules.
Other work
Doing other work during the suspension has to be reported: it can mean losing the top-up for those days.
Dismissal
While some of these tools are in use, there are limits on dismissal for economic reasons.
05 · The adjustment
Cassa integrazione in your tax return
This is the point that causes the most surprises, and it mainly affects people who received direct payment from INPS.
- The top-up is taxable income, treated like employment income.
- If you received direct payment, INPS sends you a Certificazione Unica (the annual income statement), separate from your employer's.
- Two sostituti d'imposta (withholding agents) that cannot see each other each apply the tax allowances as if they were the only one.
- The result is almost always an amount owed at the adjustment in the tax return.
- If you received the top-up in your payslip from your employer, you have a single CU and do not have this problem.
- Cassa integrazione also counts for the ISEE (the Italian indicator of household financial situation) and for income-linked benefits.
Owing money at the adjustment is neither a mistake nor a penalty: it is the mathematical effect of two withholding agents that taxed you separately. If you know in advance, you can set money aside; if you find out in June, you face a payment you had not planned for.
06 · The checks
What the worker should check
The employer handles the claim, but some checks fall to the worker alone, and nobody else will do them for you.
- That the hours shown in your payslip as covered match the hours you actually did not work.
- That the periods appear in your social security file and in your INPS contribution statement.
- That direct payment has been activated and the employer has sent the data.
- That the Certificazione Unica from INPS arrives and matches what you received.
- That any contractual top-ups provided for in the company agreement have been paid.
- That your ISEE is updated, because the drop in income may open up entitlement to benefits: see current ISEE.
The ISEE corrente (current ISEE) is the most useful and least used tool in this situation: it lets you use your present income instead of the income from two years earlier, opening access to benefits that the ordinary ISEE would keep out of reach.
Frequently asked
The questions that keep coming up
Can I work while I am on cassa integrazione?
You have to tell INPS. Doing other paid work during periods of suspension generally means losing the top-up for the days worked.
The rules vary depending on whether the work is employed or self-employed, and on how long it lasts. What you cannot do is fail to report it: data matching brings the omission to light and creates an overpayment to be repaid.
INPS is not paying me. Who should I contact?
The first check is the status of the claim in your social security file. With direct payment, the delay almost always comes from the employer not sending the data.
If the data shows as sent and the payment does not arrive, you can chase it through a CAF (authorised tax assistance centre) or a patronato (welfare advice office). If it does not show as sent, you have to chase the employer, who is the only one able to send it.
Why does my 730 show an amount owed?
Because you had two sostituti d'imposta in the same year (your employer and INPS), and each applied the tax allowances as if it were the only payer.
In the 730 (the Italian tax return for employees and pensioners) the two incomes are added together on a single scale of tax rates and the allowances are recalculated just once: hence the amount owed. It is normal and affects everyone who received direct payment.
Does cassa integrazione cost me pension contributions?
No. Periods of wage support are covered by notional contributions and count both towards qualifying for a pension and towards its amount.
It is still worth checking that they have actually been credited in your INPS contribution statement: omissions do happen, and finding them straight away is much easier than reconstructing them years later.
Let's talk
Anyone who has been on cassa integrazione almost always ends up owing tax at the year-end adjustment
It is not a mistake: it is how the calculation works. Better to know before June.