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Application of the obligation to reinstate where justified objective reason for dismissal did not exist (Camera di Commercio di Spagna in Italia – Enrico De Luca, Luca Cairoli)

Categories: DLP Insights, Publications, News, Publications | Tag: Dismissal, Court of Cassation

08 Feb 2024

By order no. 87 of 3 January 2024, the Italian Court of Cassation ruled on the applicability of reinstatement where the fact underlying the dismissal ordered for justified objective reasons did not exist.

At the end of the three instances of proceedings, the Italian Court of Cassation upheld the appeal brought by the dismissed employee, quashing the judgment of the Court of Appeal which had only granted the employee compensation amounting to 20 months’ salary.

The facts of the case

The case originates from a worker’s dismissal by a cooperative company for a justified objective reason, based on the need for a company reorganisation and the consequent outsourcing of accounting activities (the department to which the worker was assigned).

The first instance Court had upheld the worker’s appeal, declaring the dismissal unlawful.

The Court of Appeal of Catanzaro, in agreement with the first instance Court, rejected the appeal lodged by the employer cooperative, on the ground that the latter had not proved the existence: (i) of the causal link between the reorganisation and the abolition of the job; (ii) the elimination of the department to which the worker had previously been assigned; (iii) the impossibility of the worker’s relocation.

On the basis of these assumptions, the Court of Appeal judges had ordered the employer to pay the worker compensation equal to 20 months’ salary.

The worker then appealed to the Italian Court of Cassation asking for reinstatement under Article 18, paragraph 7, Italian Law no. 300/1970 (so-called Workers’ Charter).

The Italian Court of Cassation’s judgment

The Court of Cassation, in accepting the appeal filed by the worker, reiterated that the burden of proof regarding the existence of the conditions for dismissal for justified objective reasons is placed on the employer who can also resort to presumptions, with the exception that the burden is on the worker to prove the assignable posts (Italian Court of Cassation 20 October 2017, no. 24882).

With the ruling in question, the Court also addressed the issue of the “manifest” non-existence of the fact justifying, under Article 18, paragraph 7 of the Workers’ Charter, as amended by Italian Law no. 92/2012, the application of the mitigated obligation of reinstatement.

According to the Court, the assessment as to whether the fact is manifestly non-existent must be independent from the character of immediate evidence, “due to the fact that Article 18, paragraph 7, second sentence of Italian Law no. 300/1970, as amended by Article 1, paragraph 42, letter b) of Italian Law no. 92/2012, was declared constitutionally unlawful, for breach of Article 3 of the [Italian] Constitution, limited to the word ‘manifest’”.

The Italian Court of Cassation agreed with the ruling of the Court of Appeal of Catanzaro on the non-existence of the “organisational reorganisation used as the basis of the dismissal” as well as on the absence of proof of the impossibility of fulfilling the repêchage obligation (obligation to relocate). However, the Italian Court of Cassation concluded that, in the present case, the justified objective reason cited at the basis of the dismissal did not exist. The Court of Cassation criticised the compensation order stating that the  Court of Appeal had disregarded over-riding legal principles in the light of the latest rulings on the requirement of “manifest” non-existence.

In summary, according to the Italian Court of Cassation, if there is no causal link between the employer’s dismissal and the justified objective reason adduced as its basis, there is a manifest non-existence of the fact that, as such, justifies ordering the employer to reinstate the employee.

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