An employer may terminate the union agreement on performance bonus

The Court of Naples, with judgement no. 342 filed on 7 February 2017, ruled that an employer may terminate the company collective agreement concerning the performance bonus provided that such option is included in the original agreement and implemented within the terms agreed between the parties. This is because when a contractual relationship between two parties is established, “it involves the onset of a bond that cannot be broken by unilateral initiative, unless specific contractual expectations are established to provide the parties the power to unilaterally terminate the relationship“. And in the case in question, the agreement, in addition to establishing an initial duration of the bonus, stated that (i) it had to be tacitly renewed from year to year, and (ii) such renewal could be avoided if one of the parties had expressly withdrawn at least four months before the due date with a notice by registered letter with notification of receipt. Thus, the conduct of the employer which, at the expiry date of the agreement does not wish to renew it and gives notice of termination, can only be considered lawful.