Notice and Redundancy Pay in Australia vs TFR and Collective Dismissal in Italy

In Australia, the cost of ending a role depends on two NES tables: notice and redundancy pay, with redundancy pay waived for small businesses and for anyone with less than a year’s service. In Italy, notice comes from the CCNL, and the main end-of-employment payment, TFR, is owed on every exit, whatever the reason and length of service. Full comparison on Italy vs Australia .

Australia: NES notice  

Under the NES (Fair Work Ombudsman), minimum notice depends on continuous service:

• 1 year or less: 1 week
• more than 1 year up to 3 years: 2 weeks
• more than 3 years up to 5 years: 3 weeks
• more than 5 years: 4 weeks

Employees over 45 with at least two years’ service get an extra week. Notice can be worked or paid in lieu. An award, agreement or contract can give more but not less.

Australia: NES redundancy pay  

Employers with 15 or more employees must pay redundancy pay to employees with at least one year of continuous service when the job is no longer required:

It is paid at the base rate for ordinary hours, without bonuses, loadings or overtime. The drop at 10 years reflects the interaction with long service leave. Unused annual leave and long service leave are paid out as well.

Italy: notice by CCNL  

Art. 2118 of the civil code requires notice for dismissal and resignation, but the length comes from the CCNL, based on the employee’s level and seniority. For white-collar staff, periods of one to four months are common; executives often have longer. The employee also gives notice when resigning. Pay in lieu (indennità sostitutiva) is allowed. There is no age-based extra week; seniority is built into the CCNL table.

Italy: TFR on every exit  

TFR (trattamento di fine rapporto, art. 2120 civil code) accrues from day one: annual pay ÷ 13.5, minus a 0.5% contribution, about 6.91% of pay a year. The fund is revalued each year at 1.5% plus 75% of ISTAT inflation. It is paid when employment ends for any reason: resignation, dismissal, end of fixed term or retirement. There is no qualifying period and no small business exemption.

The closest Australian comparison is a mix of redundancy pay and long service leave, but TFR is closer to deferred salary. It is not compensation for losing the job.

Italy: redundancy is a dismissal for an objective reason  

An individual redundancy in Italy is a dismissal for giustificato motivo oggettivo. The employer must prove the role was genuinely eliminated and that the employee could not be redeployed (the repêchage obligation). There is no statutory redundancy pay table: the employee receives notice, TFR, accrued leave and the 13th/14th month pro rata. If the reason does not hold, Jobs Act compensation applies (see unfair dismissal vs Italian dismissal rules ).

The employer also pays the NASpI dismissal “ticket” to INPS: about €649.73 per year of service in 2026, up to about €1,949 (Law 92/2012, art. 2 c.31).

Collective dismissal  

Employers with more than 15 employees that dismiss at least 5 within 120 days in the same province must follow the collective procedure of Law 223/1991: written notice to the unions and authorities, a union consultation phase, then selection by statutory or agreed criteria. In collective dismissals without union agreement the NASpI ticket is tripled. Australia’s equivalent obligations, mainly consultation terms in awards and agreements, are lighter.

Side by side  

Example  

A software engineer on €55,000 RAL leaves after 3 years.

• Resignation: TFR of about €3,800 a year plus revaluation, roughly €11,500, plus accrued leave. No redundancy pay in either country.
• Redundancy: the same TFR, plus CCNL notice (say two months, about €8,500 if paid in lieu), plus the NASpI ticket of about €1,950. A comparable Australian employer with 15+ staff would pay 3 weeks’ notice and 7 weeks’ redundancy pay.

Common questions from Australian companies  

Can we pay TFR monthly with salary? No. It is deferred pay by law, paid at the end of employment or to a pension fund chosen by the employee.

Is there a minimum headcount exemption? No for TFR; the 15-employee line matters for Jobs Act compensation and collective dismissal.

Do we owe a severance package? Not by statute beyond TFR and notice, but negotiated exits usually include an incentive.

What this means if you hire through an EOR  

The EOR accrues TFR in every monthly invoice, so there is no unfunded liability on exit. It calculates notice from the CCNL, pays the NASpI ticket and handles any union procedure. See the Italian employment contract , other countries , the cost calculator or contact us .

Related guides for Australian companies  

• Superannuation and PAYG vs INPS, IRPEF and TFR
• Unfair dismissal in Australia vs dismissal rules in Italy
• Annual, personal and long service leave vs Italian leave

General information, not legal advice.