Employing in Italy vs the UAE

The legal differences a UAE company runs into when it hires its first person in Italy. On the UAE mainland, Federal Decree-Law No. 33 of 2021 and its Executive Regulations set a compact statutory floor: fixed-term contracts, notice of 30 to 90 days, an end-of-service gratuity and no income tax on salaries. In Italy, statute and the national collective agreement for the sector (CCNL) set binding minimums, dismissal needs a proven reason, and tax and social security take a large share of every payslip. DIFC and ADGM have their own employment laws, noted where relevant.

Topic	UAE (mainland)	Italy
Legal framework	Federal Decree-Law No. 33 of 2021 and its Executive Regulations for mainland employers registered with MoHRE. DIFC (Employment Law, DIFC Law No. 2 of 2019) and ADGM (Employment Regulations) apply their own rules. Source	Civil code, statutes and the applicable CCNL apply to every employee, from junior staff to executives (dirigenti). There is no salary threshold for protection. Source
Contract type	Fixed-term only: contracts are for a definite period and can be renewed or extended; unlimited contracts had to be converted. Probation up to 6 months, not extendable. Source	Open-ended contract is the norm. Fixed-term is free for 12 months and limited to 24 months with a statutory reason. Probation length set by the CCNL. Source
Ending employment	Either party may end the contract with written notice for a legitimate reason; dismissal without notice for listed misconduct (Art. 44) after a written investigation. Arbitrary dismissal compensation is capped at 3 months' wage. Source	After probation, dismissal needs just cause or a justified subjective or objective reason, stated in writing. Unjustified dismissal costs 6 to 36 months' pay (3 to 18 in small firms) and, in some cases, reinstatement. Source
Notice	30 to 90 days, agreed in the contract and equal for both sides; 14 days for employer termination during probation. Source	Set by the CCNL by job level and seniority, typically weeks to several months. Source
End-of-service pay	Gratuity for expatriates after 1 year: 21 days' basic wage per year for the first 5 years, 30 days per year after, capped at 2 years' wage. Optional MoHRE savings scheme (5.83% / 8.33% of basic) can replace it. Source	TFR: annual pay ÷ 13.5 (about 6.91% net of the 0.5% contribution), accrued from day one on total pay and paid on any exit, including resignation. Source
Income tax	No income tax on individuals; salary is outside corporate tax. Source	IRPEF withheld monthly: 23% to €28,000, 33% to €50,000, 43% above, plus regional and municipal surcharges. Source
Social security	GPSSA pension contributions for UAE (and GCC) nationals only; none for expatriates. Source	INPS on the whole salary for every employee, whatever the nationality: about 30% employer and 9.19% employee (plus 1% above €56,224 in 2026), plus INAIL. Source
Payroll	Wages paid through the Wage Protection System (WPS); due on the first day of each month, with escalating sanctions for late payment. Source	Monthly payroll with tax and INPS withholding, payslip (LUL), F24 payments by the 16th and annual reporting; 13th month (and 14th in some CCNLs). Source
Annual leave	30 days a year after 1 year of service; 2 days a month between 6 and 12 months. Source	At least 4 weeks a year from day one, plus 12 national public holidays from 2026 (4 October restored by Law 151/2025) and CCNL leave hours (ROL). Source
Sick leave	After probation, up to 90 days a year: 15 days full pay, 30 days half pay, then unpaid. Paid by the employer. Source	Paid from day one with an online medical certificate; INPS and employer share the cost; job protected for a period set by the CCNL. Source
Maternity and paternity	60 days maternity leave (45 full pay, 15 half pay), paid by the employer; 5 working days parental leave for either parent. Source	5 months compulsory maternity leave at 80% paid by INPS (often topped up by the CCNL), 10 working days paternity leave at 100%, plus up to 9 months' parental leave. Source
Non-compete	Permitted under Article 10 to protect legitimate business interests, for up to 2 years after the contract ends. No payment required by law. Source	Art. 2125 Civil Code: in writing, limited in object, time (5 years for executives, 3 for others) and place, and paid for. Without payment it is void. Source
Social security agreement	No bilateral social security agreement between Italy and the UAE: the UAE is not on INPS's list of non-EU countries with an agreement. Source	Anyone working in Italy for an Italian payroll pays INPS; staff sent from the UAE cannot keep home cover under a certificate of coverage. Source

General comparison for orientation, not legal advice. UAE figures are for the mainland, from u.ae, MoHRE guidance and INPS, sources read on 10 November 2026. Italian figures depend on the CCNL for the role.

What it means for your budget

In the UAE, an expatriate's gross salary is close to net pay, and the main extra employer cost is the end-of-service gratuity. In Italy, INPS applies from the first euro for every employee, IRPEF is withheld from the payslip, and the 13th month and TFR come on top. An Italian hire on €60,000 gross costs the employer about €82,000 to €84,000 and takes home well under two-thirds of gross. Agree salaries in gross terms and explain net pay early. Run the numbers in the cost calculator.

What it means for your plans

UAE managers are used to fixed-term contracts that simply end, and to notice-based termination with limited compensation. In Italy the default is an open-ended contract, fixed-term contracts are tightly limited, and after probation every dismissal needs a reason that can be proved. Use probation deliberately and plan headcount with that in mind. If you have no Italian company, an Employer of Record holds the contract, runs payroll and handles INPS for you.

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