Italian Prime Minister Matteo Renzi won a confidence vote in parliament Wednesday, giving him the go-ahead to press on with a shake-up of the country's labour market.
The Italian Senate gave its backing to Renzi's so-called Jobs Act with 166 votes in favour, 112 against and one abstention.
Unions have already been heavily critical of the draft legislation, which will make it easier to hire and fire workers.
The government says change in this area is vital to allow companies to grow and create jobs.
The country's biggest labour union, the CGIL, has vowed to hold a general strike and stage nationwide demonstrations against the plans.
"The Jobs Act will become law. Italy is really changing," Renzi wrote on Twitter.
The job market is a particularly sore topic in the eurozone's third largest economy, which is struggling to stave off its third recession in six years.
Youth unemployment stands at a record 44.2 percent and those who do manage to find work are often hired on temporary contracts which offer little in the way of security or benefits.
Much of the debate over the reform plans, including initially within Renzi's own centre-left Democratic Party, has centred on proposed changes to a law known as Article 18 -- which protects those who are unfairly dismissed.
Hundreds of thousands took to the streets of Rome in October in protest at the Jobs Act, calling on Renzi to do more to protect the rights of new entries to the job market.
The labour market proposals also involve reducing short-term contracts and increasing some out-of-work benefits.