UAE Fixed-Term Contracts vs the Italian Employment Contract and CCNL

A UAE founder hiring in Italy usually starts with the contract template they know: a fixed-term contract registered with MoHRE, a probation period of up to six months, and a job title and basic salary that drive most other entitlements. Italy works almost the other way round. The default is an open-ended contract, fixed-term contracts are the exception, and the national collective agreement for the sector (CCNL) sets pay scales, job levels and many rules the contract cannot go below. Full comparison on Italy vs the UAE .

The UAE: fixed-term contracts under Decree-Law 33 of 2021  

On the mainland, employment is governed by Federal Decree-Law No. 33 of 2021 on the Regulation of Labour Relations and its Executive Regulations. The government portal summarises the key contract rules:

• Fixed-term only. Contracts are concluded for a definite period and can be extended or renewed for a similar or shorter period. If the term ends and both sides keep performing, the contract is treated as renewed on the same terms.
• Conversion. Older unlimited contracts had to be converted to fixed-term contracts within one year of the law taking effect.
• Work patterns. Full-time, part-time, temporary and flexible work, plus remote work and job sharing, are recognised models.
• Probation. Up to six months and not extendable. The employer can end employment during probation with 14 days’ written notice.

Pay is usually split into basic salary plus allowances (housing, transport and others), and the basic salary matters because overtime and gratuity are calculated on it.

A note on DIFC and ADGM  

The two financial free zones have their own employment laws. In Dubai, the DIFC Employment Law (DIFC Law No. 2 of 2019, as amended) applies, with its own probation, notice and end-of-service savings rules (DEWS). In Abu Dhabi, the ADGM Employment Regulations apply. If your UAE company sits in DIFC or ADGM, your HR team may be used to a more common-law style contract, but the Italian side below is the same.

Italy: open-ended by default, CCNL on top  

An Italian employment relationship rests on three layers:

1. Statute: the civil code, the Workers’ Statute (Law 300/1970), Legislative Decree 81/2015 on contract types, working-time rules and the Transparency Decree (Legislative Decree 104/2022).
2. The CCNL: the national collective agreement for the sector (commerce, metalworking, IT services, and so on). It fixes minimum pay by level, the 13th and often 14th month, notice periods, probation length, sick-pay top-ups and much more. In practice every employer applies one.
3. The individual contract: it can improve on the CCNL but cannot go below it.

The open-ended contract (contratto a tempo indeterminato) is the standard form. A fixed-term contract (contratto a tempo determinato) can be used freely for up to 12 months; beyond that, and up to 24 months in total, it needs one of the reasons set out in law or in the CCNL (art. 19 Legislative Decree 81/2015, as amended in 2025). Exceeding the limits converts the contract into an open-ended one.

Probation (patto di prova, art. 2096 civil code) must be agreed in writing before the start. Its maximum length is set by the CCNL according to job level, and cannot exceed six months. During probation either party can end the contract without notice or reason, unless the CCNL provides otherwise.

Written terms. The Transparency Decree requires the employer to give the employee written information on the main terms (place of work, job level under the CCNL, pay, hours, leave, notice, training and more) at the start of employment. The hire is notified online to the authorities (UniLav) by the day before work begins.

Side by side  

Why “fixed-term” means something different  

In the UAE, a fixed-term contract is not a sign of a temporary job; it is the normal legal form, and both parties expect renewals. In Italy, a fixed-term contract signals a temporary need. Rolling an employee from one fixed-term contract to the next quickly hits the 24-month ceiling and invites a claim that the job is really permanent. If the role is permanent, Italian practice is to hire on an open-ended contract and use probation as the trial period.

This matters for planning. A UAE company may think that a fixed-term contract will let it end employment simply by not renewing. In Italy, that works only within the limits above. After that, ending employment means a dismissal, which needs a reason (see termination and notice in the UAE vs dismissal rules in Italy ).

Basic salary vs total pay  

UAE packages are often built as a low basic salary with large allowances, partly because gratuity is calculated on basic pay. Italy does not reward that structure. Social contributions, TFR and the 13th month are calculated on almost all regular pay, and the CCNL sets the minimum for the basic element. Italian offers are expressed as RAL (retribuzione annua lorda), the gross annual salary including the 13th (and 14th) month. Compare like with like in the cost calculator .

What this means if you hire through an EOR  

With an Employer of Record, the Italian contract is issued by the EOR under the CCNL that fits the role, with the correct level, probation and notice. You agree the role, the gross salary and the start date; the EOR handles the Transparency Decree information, UniLav notification and INPS registration. You do not need an Italian company or a UAE-style work permit process for Italian or EU nationals. Read the overview of the Italian employment contract , compare countries on Italy vs your country , or contact us for a quote.

Related guides for UAE companies  

• End-of-service gratuity vs Italian TFR
• Tax-free salary vs IRPEF and INPS: the net-pay shock
• Annual, sick and maternity leave and working hours
• WPS and work permits vs Italian payroll and INPS

General information, not legal advice.