When is dismissing an employee on sick leave lawful?

In its judgment No. 27656 of 30 October 2018, the Court of Cassation has again addressed the matter of employees who do other work whilst on sick leave.

The Facts

An employee who was involved in an accident in the workplace and was prescribed a rest period of 15 days using medical supports and ice packs, worked for the family business whilst on sick leave, as documented by an inspection conducted on request of the employer. The company therefore commenced a disciplinary procedure, which resulted in the dismissal of the employee for cause.

The employee resorted to the Court for the dismissal to be declared unlawful. The court dismissed the application. The employee filed an appeal and the trial court ruling was overturned.

In the case in issue, the local court had held that the conduct of the worker constituted a breach of an employee’s duty of care, which should have induced the employee to observe the prescribed period of rest following the accident at work.

On the other hand, the Court of Appeal took the view that the conditions for dismissal for cause were lacking, having the medical-legal expert’s report excluded that the work carried out in the days following the accident, albeit against the doctor’s orders, would have exacerbated the patient’s condition. The Court of Appeal thus concluded that the protection set out in paragraph 5 of art. 18 of the Workers’ Statute was applicable to the case examined (termination of the employment contract as of the date of dismissal and ordering the employer to pay an indemnity equivalent to 12 to 24 months of the last total salary, taking into account the length of service, the number of people employed, the size of the company’s economic activity and the conduct and the situation of the parties).

The employer appealed to the Court of Cassation to have the Court of Appeal ruling overturned.

The ruling of the Court of Cassation

The Court of Cassation highlighted that, in Italian legal system, there is no absolute prohibition against an employee doing other work whilst on sick leave, but clarified that such type of conduct might constitute a justified objective reason for dismissal if associated with a breach of the general duties of fairness and good faith and the specific contractual obligations of diligence and loyalty. This would be the case where:

–       the work carried out elsewhere by the employee provides, on its own, sufficient grounds to assume that the medical condition underlying the sick leave is inexistent, thus denoting fraudulence or simulation on part of the employee, or

–       the work activity itself – assessed in relation to the nature and the characteristics of the employee’s medical condition and taking into account the tasks performed – is such as to compromise or delay, even potentially, the worker’s recovery and return to work, thus constituting a breach of an obligation which legal doctrine places in the category of preparatory and instrumental duties in the proper performance of a contract (see the Court of Cassation rulings No. 14046 of 1 July 2005, No. 21253 of 29 November 2012 and No. 10416 of 27 April 2017).

The Court of Cassation also established that the trial court’s assessment of the impacts of work on the employee’s recovery should focus on how the employee behaves when carrying out an activity that might delay his/her recovery and thus compromise his/her ability to carry out future work activities in a timely manner.

Therefore, according to the Court of Cassation, the trial court had rightly found that:

–       in the daily activities carried out by the employee, as documented by the inspection conducted on request of the employer, the employee had used medical supports but had not observed the prescriptions of the medical practitioner;

–       such behaviour had made the outcome of the period of convalescence uncertain, thus breaching the preparatory and instrumental duties linked to the proper performance of the contract, as well as the specific contractual obligation of diligence.

The Court of Cassation also held that the application of the indemnification protection set out in paragraph 5 of art. 18 of the Workers’ Statute was correct in the case examined in light the existence of the fact, albeit supported by a psychological element that was not suggestive of a frequency such as to constitute just cause.