New Legal Ruling Brings Relief to Temporary Workers
In a landmark decision, Italy’s highest court has ruled that employees on successive fixed-term contracts—later recognised as having been in continuous employment—do not have to repay their unemployment benefits (NASPI). This comes as a much-needed victory for thousands of workers who feared clawback of financial support during periods of contractual uncertainty.
What Is NASPI and Why Repayment Was a Concern
NASPI (Nuova Assicurazione Sociale per l’Impiego) is Italy’s social insurance for the unemployed, providing a monthly stipend while beneficiaries seek new work. Traditionally, if a judge later revoked a dismissal or retroactively converted fixed-term contracts into a permanent contract, the National Social Security Institute (INPS) could demand repayment of NASPI payments. Likewise, benefits could be reclaimed if a beneficiary began a new job exceeding income thresholds.
The Cassazione’s Game-Changing Sentenza No. 23876
On 26 August 2025, Italy’s Cassazione (Supreme Court) issued Sentenza No. 23876, establishing a crucial exception for precarious workers. The ruling states that if a court finds a series of fixed-term contracts illegitimate and converts them retroactively into a single open-ended contract, the unemployment benefit received in the interim remains valid and cannot be reclaimed.
- Retroactive conversion: The court’s decision applies only to contracts transformed by judicial order into a permanent position.
- Genuine unemployment period: The key factor is the actual gap between the end of the last fixed-term contract and the formal re-employment date.
- No pay or contributions: During this interval, the worker truly lost salary and social contributions, justifying entitlement to NASPI.
Real-Life Impact: Who Benefits Most?
This ruling directly benefits temporary workers who challenge short-term hires in court:
- Seasonal employees in retail, hospitality, or agriculture facing multiple contracts.
- Project-based professionals reliant on sequential fixed-term agreements with the same employer.
- New mothers or caregivers whose contracts ended due to family needs and later sought judicial reinstatement.
By removing the legal uncertainty around benefit repayment, the court encourages more workers to defend their rights without fear of financial penalty.
Why the Court Reconsidered the ‘Overpayment’ Rule
Previously, INPS interpreted any retroactive contract validation as erasing the unemployment period, thus deeming NASPI “unduly perceived.” However, judges recognised that legal fiction cannot undo lived reality. If a worker had no income and no social protection during a genuine gap—despite a later ruling that a permanent contract existed—the support granted by NASPI was both legitimate and necessary.
Practical Steps for Affected Workers
If you’ve held fixed-term contracts and received NASPI, here’s how to proceed:
- Keep all contract documents and judicial orders proving retroactive CDI conversion.
- Submit your NASPI application promptly after contract termination—do not delay.
- If INPS issues a repayment notice, provide Sentenza No. 23876 as legal justification.
- Consult a labour law specialist to ensure your benefit claim aligns with the new ruling.
Wider Implications for Italy’s Workforce
This decision marks a significant shift in protecting temporary workers against undue penalties. Labour unions and employment lawyers expect an upswing in cases challenging precarious hiring practices. Employers will also need to reassess hiring strategies, ensuring contract legitimacy to avoid costly litigation and social security disputes.
Looking Ahead: Towards Greater Job Security
By aligning legal principles with the real-world conditions of precarious employment, Italy’s Cassazione has taken a step towards a fairer labour market. Temporary workers can now contest abusive contract cycles without risking repayment of essential benefits. As legislative and administrative bodies update their guidelines, the stability of NASPI support will provide a firmer safety net for all who face periods of unemployment.
