The Court of Cassation, with its ruling no. 16253 of 29 July 2020, expressed its opinion on the applicability of the “mitigated” reinstatement protection (with employment re-establishment and compensation up to a maximum of 12 months’ salary) in cases with no underlying cause for dismissal for objective justified reasons.
The case in question originates from a judicial appeal by an employee against dismissal based on justified objective grounds after the contract under which they were employed was terminated.
The Court of Appeal of Rome, hearing the employer’s complaint, upheld the worker’s request and confirmed the first instance decision declaring the dismissal illegitimate on the assumption that the defendant company had not demonstrated a relationship between the loss of the contract and the loss of the redundant worker’s usefulness.
The Board of Appeal ruled that the contract termination did not constitute an objective justified reason for dismissal in the absence of proof of the necessary causal link between the organisational and production reason underlying the employment termination, given that the employee was not exclusively or predominantly involved in that contract.
The losing company appealed to the Court of Cassation against the decision on the merits, complaining about the incorrect application of paragraphs 4 and 7 of article 18 of Italian Law 300/1970.
The Court of Cassation, in rejecting the appeal filed by the company, focused on analysing the discrimination between the application of the indemnity protection under art. 18, paragraph 5 (all-inclusive indemnity between a minimum of 12 and a maximum of 24 months’ salary) and the “mitigated” reinstatement protection provided for in art. 18, paragraph 4 in cases of dismissal for objective reasons, under Article 18, paragraph 7 of Italian Law 300/1970.
This last provision grants the judge the power to apply the “mitigated” reinstatement protection rules in cases where they find “a lack of an underlying cause for dismissal for objective justified reasons.”
According to the Supreme Court, the legislator’s intentions should be interpreted in the sense of attributing a residual nature to reinstatement protection which functions as an exception to the indemnity protection rule in cases of dismissal for objective justified reasons.
The Supreme Court recalled a recent ruling (Cassation decision no. 29101 of 11 November 2019), on individual dismissal for justified objective reason, “the lack of a causal link between the employer’s termination and the underlying reason can be classified within the evidence required to supplement the manifest lack of a cause that justifies the mitigated reinstatement protection under article 18, paragraph 7, Italian Law 300/1970 as amended by Law 92/2012.”
The Court of Cassation observed that “the absolute lack of connection between the contract termination and the work carried out by the worker, led the Court to exclude the existence of a causal link and the fact constituting a justified objective reason for dismissal.” The Court continued: this “ictu oculi” absence, would result in the “manifest lack of fact as it appears to be so evident to have correctly induced the second instance judge to opt for a mitigated reinstatement protection referred to in paragraph 4 of article 18 in its combined effect with the seventh paragraph.”
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The judgement raises many doubts about the long-standing uncertainty regarding the application of reinstatement protection in cases of dismissal for justified objective reasons deemed unlawful. The Court’s conclusion appears controversial in a certain sense, as it supports the residual nature of reinstatement protection opposed to indemnification. However, it links the concept of manifest absence of the cause underlying the dismissal (which allows the judge to apply mitigated reinstatement protection) to cases in which the judge considers there is a lack of a causal link.
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