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In employment relationships, the worker operates under the employer’s organizational and managerial authority, which includes the power to temporarily change the place where the work is performed. This adjustment, when not definitive, is regulated through the legal concept of business travel.
It is important to clarify that the decision to assign an employee to business travel is unilateral—it is part of the employer’s directive powers and does not require the employee’s consent. This principle has been repeatedly affirmed in case law, including in ruling no. 20833 of October 15, 2015, where the Italian Supreme Court confirmed the legitimacy of this directive power, provided it respects the law and the constitutional principles of human dignity and health (Art. 41 of the Italian Constitution).
What Is Business Travel and When Does It Apply?
Business travel refers to the temporary relocation of an employee to a workplace different from their regular location, for operational or organizational needs. It does not imply a change in the contractual workplace and, although performed elsewhere, the work remains under the oversight of the original company structure.
While there is no statutory definition of business travel, both case law and national collective bargaining agreements have defined its distinguishing elements, differentiating it from permanent transfers and “traveling work” arrangements.
Two Core Elements of Business Travel: Temporariness and Functional Connection
Temporariness
The first essential characteristic of business travel is its temporary nature. The employee is required to perform their duties elsewhere only for a limited time, with a guaranteed return to their regular workplace. The specific date of return need not be known in advance, but the return itself must be planned.
Italian case law has consistently emphasized that business travel remains temporary even when it extends over a longer period—so long as it is not intended to become permanent. The Supreme Court, in ruling no. 14380/2020, confirmed that business travel can remain temporary even with extended duration, as long as the employer’s intent is not to establish a new permanent workplace. This was echoed in ruling no. 6240/2006, which held that the overlap between a temporary assignment and a future transfer does not automatically alter the legal nature of the travel.
Functional Connection to the Original Workplace
The second key element is the ongoing functional relationship with the original workplace. Despite the change in location, the employee continues to operate under the same company’s organizational structure and remains subject to its directives and oversight.
This concept was underscored by the Milan Labour Court in a 2016 ruling, which highlighted that business travel presumes the employee remains functionally tied to the originating business unit. Similarly, Supreme Court ruling no. 8135/2008 clarified that working from a different location does not sever the legal connection to the original employer’s organizational context.
Distinction Between Business Travel, Transfers, and Traveling Work
A transfer implies a permanent and definitive change in the place of work, with corresponding contractual adjustments. Business travel, by contrast, is temporary and does not change the employee’s permanent work location.
Traveling workers (or “trasfertisti” in Italian legal terms) differ entirely. These employees do not have a fixed work location in their contract and are continuously required to work in various locations, often due to the nature of their job. According to Decree-Law 193/2016 and INPS Circular No. 158/2019, three conditions must exist simultaneously to classify an employee as a traveling worker: the absence of a designated workplace in the contract, a job requiring constant mobility, and a fixed allowance regardless of whether travel actually occurs.
Business Travel Allowances: Legal Nature and Social Contributions
Business travel usually entails additional costs for the employee. To compensate, companies may provide a travel allowance, either set by collective bargaining agreements or through internal policies. The Italian Supreme Court (ruling no. 14047/2020) has confirmed that this allowance has a dual nature: partly compensatory, reimbursing expenses, and partly wage-related, acknowledging the inconvenience of being away from one’s usual workplace.
Tax Treatment of Travel Allowances: TUIR Guidelines
The Italian Tax Code (TUIR, Art. 51, para. 5) provides preferential tax treatment for travel allowances and reimbursements only for travel outside the municipality where the employee’s regular workplace is located.
Under the TUIR, there are three distinct reimbursement models:
- Flat-rate allowance: A fixed daily amount exempt from tax up to €46.48 for travel within Italy and €77.47 for travel abroad, excluding documented transport expenses.
- Itemized reimbursement: Covers documented expenses for meals, accommodation, and transport. These do not count as income, and additional undocumented costs are tax-exempt up to €15.49 (Italy) or €25.82 (abroad).
- Mixed model: Combines itemized reimbursements for certain expenses with a reduced flat-rate allowance. The tax-exempt thresholds are reduced proportionally based on the items reimbursed.
For intra-municipal travel, no tax exemption is available, except for documented transport expenses (e.g., metro, taxi, car sharing).
2025 Updates: Mandatory Traceable Payments
With the 2025 Budget Law (Law 207/2024), tax exemption for travel-related reimbursements is now conditional upon the use of traceable payment methods. Eligible payments include bank transfers, credit or debit cards, prepaid cards, or checks. This applies to all reimbursable expenses such as meals, accommodation, and transport services (including taxis and rental with driver).
Kilometric Reimbursement for Personal Vehicle Use
Employees using their own (or otherwise available) vehicles for business travel are entitled to kilometric reimbursement, calculated using ACI (Italian Automobile Club) tables. These consider the vehicle type, fuel consumption, depreciation, insurance, and a standardized annual mileage of 15,000 km.
To qualify for tax exemption, the reimbursement must remain within ACI limits and be supported by a detailed travel report that includes date, route, distance, and vehicle used.
INAIL Coverage and Reporting Obligations
According to INAIL Circular No. 4465/2008, employers must notify the institute of a business trip only if the employee is exposed to new or different risks compared to those covered under their current insurance policy. The communication must occur within 30 days of the change.
Furthermore, INAIL Circular No. 52/2013 clarifies that any injuries occurring during business travel are considered work-related. Coverage includes incidents during travel between home and the temporary workplace, between accommodation and work site, and within the lodging itself. However, injuries stemming from personal, irrational, or voluntary actions unrelated to the job (so-called “elective risks”) are excluded from compensation.
Conclusion
Business travel plays a crucial role in the operational flexibility of subordinate employment. When managed correctly, it allows companies to meet short-term organizational needs without altering the underlying employment contract. For the travel to be legitimate, it must meet two key conditions: the temporariness of the relocation and the continuation of a functional relationship with the original workplace. The Italian legal framework, enriched by solid jurisprudence and detailed tax regulations (TUIR), ensures a fair balance between employer needs and employee protections.
