Covid-19 emergency, dismissals for justified objective reason and extension renewals of fixed-term contracts (Guida al Lavoro de Il Sole 24 Ore, 19 June 2020 – Vittorio De Luca, Antonella Iacobellis)

On 3 June 2020 the National Labour Inspectorate (“INL”) issued note no. 160, providing explanations related to the amendments and additions made to Italian Decree Law no. 18 of 17 March 2020 (“Save Italy Decree”) converted in Italian Law no. 27 of 24 April 2020, by Italian Law Decree no. 34 of 20 May 2020 (“Relaunch Decree”).

In this discussion we will focus on the indications provided by INL concerning collective and individual dismissals for justified objective reason and extension or renewal of fixed-term contracts.

1.         Collective and individual dismissals for justified objective reason

INL explained that, when the Save Italy Decree was converted into law, a new exclusion was introduced to the ban on dismissals for cases where “the personnel involved in the termination, already employed in the contract, is rehired after take over by a new contractor by law, the national collective employment contract or clause of the tender contract”.

Therefore, termination by the previous employer is considered lawful only if the new contractor hires the employee. Vice versa it is not possible to dismiss a worker who is not rehired by the new contractor.

In terms of the extension on the ban, it was restated that it is not possible to start collective dismissal procedures from 17 March 2020 until 17 August 2020, while pending ones, started after 23 February, are suspended for the same period.

Likewise, the ban on dismissal for justified objective reason as per art. 7 of Italian Law no. 604/1966 is extended for the same period and suspension is envisaged for the relative procedures in progress, i.e. those not yet defined on the date the Relaunch Decree became effective.

The note then reiterates the contents of paragraph 1 bis according to which, if the employer exercised termination in the period between 23 February and 17 March, the same may revoke it as long as “the employer requests the exceptional redundancy fund, as per article 22, from the date when the dismissal became effective” and “in that case, the employment is considered restored without interruption and without charges or penalties for the employer”.

However, INL did not explain how to manage:

• those dismissals implemented on 17 and 18 May 2020 based on the delay in issuing the Relaunch Decree, despite the fact that it does not seem possible to deviate from the non-retroactive principle of the legislation;
• dismissals of managers, formally excluded from the ban on dismissals, since the legislation expressly refers to the employment contained in art. 7 of Italian Law no. 604/2020.

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