Fine of one thousand to five thousand euros to the owner who renovates his house with an illegal contractor

A crackdown on undeclared work in building renovation is on the way. In private contracts, before payment of the final balance, the threshold for the total amount - from EUR 500,000 to EUR 70,000 - for the congruity check will be lowered, in the absence of which a fine of between EUR 1,000 and EUR 5,000 will be imposed on the client, i.e. on the homeowner who has turned to the construction company.

As a result of the novelty contained in the Cohesion Decree Law approved by the government last 30 April, in order not to incur an administrative penalty the client before the end of the work must obtain from the construction company the certificate referring to the congruity of the cost of labour also for building works of 70 thousand euro, a lower threshold that ends up involving many home renovations. The consequence of all this is that since the entry into force of the Cohesion Decree-Law, the client must check that the company is regular or has regularised any undeclared positions before paying the final balance of the work, under penalty of a fine.

It is necessary, however, to take a step back and recall that a decree of the Ministry of Labour, No. 143 of 2021, had established the obligation of fairness checks for construction works in the private sector starting from 70,000 euro, then in the conversion into law of the Pnrr decree (Law No. 56 of 2024) an administrative sanction from 1,000 to 5,000 euro was introduced at the expense of the client, if the payment of the final balance takes place in the absence of a positive outcome of the verification or prior regularisation of the position by the contractor. Therefore, Article 28 of the Cohesion Decree aligns the threshold for the declaration of congruity verification with the threshold triggering the fine to 70,000 euro.

Moreover, the same decree in fact provides for a double clampdown on irregular labour in construction. The client in private works, as well as the single project manager (Rup) in public contracts, are obliged to check the appropriateness of the incidence of labour on the overall work. The sanctions extend to small construction sites also in public contracts. The absence of the 'congruity' certificate in public procurement contracts has so far, as a result of the Pnrr Decree, only triggered the sanction for amounts of 150,000 euro and above, but with the Cohesion Decree this threshold is abolished. The consequence of all this is that in public contracts, without prejudice to the profiles of administrative-accounting liability, the payment of the final balance by the project manager in the absence of a positive outcome of the verification or prior regularisation of the position by the contractor, is considered by the contracting station for the purposes of assessing the performance of the same. The finding of the breach is communicated to Anac, the national anti-corruption authority, with consequences for the qualification of the contracting stations..

The Pnrr decree, converted into Law 56 of 2024, revised the penalties and returned criminal offences. The decree increases by 10 per cent (to 30 per cent) the amount of the fine provided for in the case of the actual employment of employees without prior notification of the establishment of the employment relationship by the private employer. It rises from Euro 1,950 to Euro 11,700 for each irregular worker, in the case of employment of the worker for up to 30 days of actual work; from Euro 3,900 to Euro 23,400 for periods of between 31 days and up to 60 days; and it rises from Euro 7,800 to Euro 46,800 when the number of days of actual work exceeds 60 days. Not only that. For the unauthorised exercise of the activity of labour administration, the penalty is imprisonment of up to one month (previously not provided for) or a fine of 60 euro for each worker employed and for each day of work (previously 50 euro). For the unauthorised exercise of the activity of personnel brokering, recruitment and selection, the penalty is imprisonment of up to three months or a fine of EUR 900 to EUR 4,500.