We are once again addressing the “new” framework governing fair pay, which is set to have a significant impact on employment law and industrial relations following Law Decree No. 62 of 30 April 2026, known as the “1 May Decree”, converted into Law No. 112 of 25 June 2026.

The legislature has intervened directly on the implementation of Article 36 of the Italian Constitution, identifying Total Economic Compensation (TEC) as the benchmark for determining the mandatory minimum level of pay.

At the heart of the new framework are National Collective Bargaining Agreements (CCNLs) entered into by trade unions and employers’ organizations that are comparatively more representative at national level, with the aim of providing greater certainty in a context characterized by an increasing plurality of collective agreements.

The role of the courts nevertheless remains an open issue, particularly with regard to their ability to independently determine whether pay is proportionate and sufficient, in light of the new criteria established by the legislature.

The new framework also broadens the concept of relevant pay, including, depending on the provisions of the applicable CCNL, various economic components falling within the TEC, such as fixed and recurring elements, additional monthly payments and certain allowances. Questions nevertheless remain as to whether items such as contractual welfare benefits, meal vouchers and specific allowances should be included.

Particular attention should also be paid to individual additional pay (superminimi) which, although they do not appear to fall within the abstract definition of TEC, may nevertheless be relevant when assessing the worker’s overall pay package.

The scope of the legislation is general, making the identification of the correct CCNL a key issue. This assessment must be based on the activity carried out, the relevant sector, the applicable business category and the specific characteristics of the company.

In this context, the representativeness of the organizations entering into the collective agreements remains one of the most sensitive issues.

The new framework may also have significant implications for the contracting and outsourcing sector, where labor costs and compliance with minimum economic treatment directly affect competition between companies.

At the same time, the new rules on pay transparency and information requirements make it increasingly important for companies to be able to analyze and explain the rationale underlying their pay policies, including where pay differentials do not raise any issues of illegality.

The 1 May Decree therefore brings the debate on trade union representation, representativeness and collective bargaining back to the forefront.

The challenge in the coming months will be to translate these new principles into clear and workable criteria, particularly in cases where several CCNLs may potentially apply or where the pay structure contains particularly complex elements.

Companies should therefore consider it essential to proactively review the collective agreements they apply, the composition of the TEC and their internal pay policies.

Ultimately, “fair pay” represents not merely a new threshold of economic protection for employees, but potentially a turning point in the relationship between legislation, collective bargaining and case law, with implications for personnel management and industrial relations.

The law Firm remains available to provide any further clarification or assistance.