Across Europe, Italian authorities have shifted decisively from a permissive administrative regime to an enforcement regime that treats unauthorized secondments and undeclared foreign labor as a criminal exposure event — not a paperwork defect.

Multinational employers often assume that when a non-EU employee is sent to Italy “temporarily,” or kept on foreign payroll, or handled through a vendor pending permit issuance, the assignment is internally lawful and externally invisible. Italian law takes the opposite view: physical work performed on Italian territory without an approved legal basis triggers the same liability profile as illegal employment, regardless of payroll location or corporate intent.

This compliance reality changed materially in 2024, when Italy re-criminalized unlawful staff supply, contracting, and secondment — reinstating arrest-level penalties in addition to proportionate fines.

The relevant amendment was enacted through Law No. 56/2024 (implementing Decree-Law 19/2024), which modified Article 18 of Legislative Decree 276/2003. In a public interpretive note (INL Note No. 1091/2024), the Italian National Labour Inspectorate confirmed that violations are now punishable by arrest or a daily fine per worker per day of unlawful work, with mandatory aggravations when the worker is foreign. (Reference: HR Capital analysis of Law 56/2024 and INL operational guidelines.)

This matters because the most common corporate fact pattern — MBA-track staff, restructuring personnel, PE portfolio operators and finance executives dispatched abroad mid-transaction — is exactly the pattern that, when unfiled, falls into the “unlawful secondment” bucket.

Italy does not ask whether internal stakeholders saw the transfer as “temporary,” “internal,” “in transition,” or “awaiting processing.” The enforcement test reduces to two questions only:

1. Was the foreign national physically present in Italy and performing work?

2. Was the legally required authorization filed before that work began?

If (1)=yes and (2)=no — legally the status becomes undeclared employment of a foreign worker, with criminal and financial consequences attached automatically. Intent, vendor involvement, payroll origin, and “we planned to regularize” do not negate the violation.

Italy’s posture is by design. The Italian legislature explicitly stated that the purpose of the 2024 changes is to ensure “legal and orderly entry” and to counter “illegal recruitment and employment of foreign manpower” — language identical to the conduct that describes undeclared inbound secondments by non-EU employers. That legislative framing means a multinational cannot realistically argue that failure to formalize is a technical delay; the law codifies it as the very harm the statute was enacted to deter.

The proportional fines make that clear. Italian enforcement now applies a per-day, per-worker multiplier, increased when the worker is foreign and further increased in recidivism scenarios. Criminal arrest remains an alternative sanction, not a theoretical backstop. The Inspectorate also clarified that even when calculated exposure would fall below €5,000, the floor is statutorily raised to €5,000 minimum and only later subject to limited reduction under specific provisions — meaning there is no zero-consequence path once a violation exists.

From a compliance-risk perspective, that is the trap: By the time the employer discovers the issue, the violation has already matured and the statutory fine floor has already attached. Italy does not recognize a “cure period” that retroactively legalizes a foreign worker’s past presence.