Let's start with workers' participation in company life. "A step forward, not a revolution"

MILAN – The law on workers’ participation in companies , definitively approved by Parliament in mid-May and then published in the Official Journal, comes into force on June 10. The text was launched by the Cisl, without finding a common front with Cgil and Uil, and it defines workers’ participation in the life of companies in four forms: Management; Economic/Financial; Organizational; Consultative.

With the help of Livio Bossotto, partner at A&O Shearman , we see what this means in concrete terms.

What are the four forms of participation?

Management participation involves the direct presence of workers' representatives in corporate bodies (supervisory board or board of directors depending on the corporate structure) - explains Bossotto - The economic/financial one concerns the possibility of profit distribution and widespread shareholding. Organizational participation is achieved through the establishment of joint commissions to promote innovation in the production and organizational fields. Consultative participation allows workers to express opinions on company decisions through formal consultations. All of the above can still be implemented on a voluntary basis : there is no obligation for companies to implement forms of participation.

The law implements Article 46 of the Constitution. Why did it come after 80 years?

The implementation of art. 46 of the Constitution, which recognizes the right of workers to participate in the enterprise as a characterizing element of the economic and social model, took almost 80 years due to deep cultural and historical resistance . The Italian model of industrial relations has traditionally been conflictual, more oriented towards opposition than collaboration. Only now, with a push from below and a favorable European context, has an organic law been reached, albeit very soft, on the subject. The delay certainly weighs: participation in Italy arrives when elsewhere it is already history .

On the point of management participation, the obligation to introduce it for public companies and the tax relief for companies that provided for it has been dropped (compared to the popular initiative law). How "incomplete" is the provision, without these obligations/incentives?

The absence of significant obligations and incentives makes the rule less effective : management participation remains an option, not an enforceable right. Without obligations or incentives, it risks remaining on paper. Public companies, which could have led the way, have been exempted.

How do you think private companies will react?

They will probably remain to watch what the largest industrial players do to evaluate the costs and benefits of participatory models, without taking risks.

As for participations, there is talk of a “weakening” in progress with a mere increase in the taxed limit favorably (from 3 to 5 thousand euros, for 2025 only) with a reduced rate from 10 to 5% for three years. What is the actual scope?

More than a revolution, the economic participation provided for by the law is based on a fragile temporary balance: the ceiling goes up, the rate goes down, but only for one year. And only if at least 10% of the profits go to workers, a threshold that is far from a given. It should be added that these forms of profit sharing must be regulated within company collective agreements, subject to the play of the parties in union negotiations. Without important structural incentives, even the opportunity (albeit limited) of the preferential tax regime for the distribution of profits risks remaining a dead letter.

Even in other places there is talk of simple references to the civil code...

Article 6 merely reports the instruments for worker participation in the company's capital already contemplated in the Civil Code and adds that shares can also be assigned in place of performance bonuses. For shares assigned in place of performance bonuses only, the law introduces a 50% tax exemption on dividends up to 1,500 euros per year . This is a positive measure but limited in scope, both in terms of the amount and the annual duration. Even in this case, in light of the modest tax benefit introduced, there is no great change compared to the previous regulatory framework.

The law relies heavily on the "voluntariness" of initiatives. Is collective bargaining the place to include these provisions?

Collective bargaining undoubtedly plays an important role, but for the effective implementation of management participatory measures, company statutes are even more crucial . In fact, the law establishes that management participation can be provided for by the statutes, provided that it is regulated by collective agreements . This is a double step that does not go unnoticed : subordinating management participation to voluntary inclusion in company statutes, rather than making it mandatory if provided for by collective bargaining, risks further weakening the possibilities for a real implementation of these tools. On the contrary, collective bargaining remains central to other forms of participation, such as economic and organizational participation, the details of which must be defined at company level.

What role will these tools have in defining relationships in companies?

I expect that many companies will wait until they see concrete benefits or are subject to strong union pressure or indications that may also come from trade associations. In companies characterized by a positive dialogue with unions, the law can strengthen collaboration and lead to the creation of forms of participation. Elsewhere, it risks being ignored. Without obligations and with time-limited incentives, participation risks remaining an opportunity for a few pioneers.

What is the overall assessment?

A step forward, but small and uncertain. The law breaks a taboo, but it does so with kid gloves: no obligations, few incentives, everything entrusted to the good will of businesses . It is certainly a cultural signal (in line with what has been happening for years in other European countries and even more so in the American and Anglo-Saxon reality), but not a concrete and feasible revolution . If the social parties do not jointly commit to experimenting with new models of collaboration, it will remain a missed opportunity that leaves open the possibility of improvements and extensions in the future.