Dismissal of managers: the employers can supplement the grounds in the course of proceedings

With judgment no. 3147 of 1 February 2019, the Court of Cassation remarked that the employers can supplement the grounds for dismissal in the course of proceedings if these are insufficient or generic.

The facts

The Court of Appeal having jurisdiction, upholding the judgment of the Court of first instance, had declared that the dismissal of a manager, namely “Plant Manager“, was legitimate.

More specifically, the Court of Appeal had ruled that:

• the letter of termination of employment contained a brief although sufficient explanation, namely, the elimination of the position in consequence of the reorganization of the company and unavailability of other positions;
• the pre-trial assessments revealed that in fact the reorganization of the company had resulted in a different organization of the plant’s management activities.

The manager filed an opposition before to the Court of Cassation against the decision of the Court of Appeal.

The decision of the Court of Cassation

According to the Court of Cassation, the lower-degree courts have correctly interpreted Article 22, National Collective Labour Agreement for Industrial Managers of 1985, evaluating the content of its contractual clause and the relevance attributed by the parties to the lack or incompleteness of the grounds of dismissal, a relevance that can be appreciated by reading the entire provision.

More specifically, Article 22 sets out that “in the event of termination of permanent employment, the terminating party must serve a written notice thereof to the other party. In the event of termination on the part of the employer, this is obligated to specify at that time the reason thereof. If the manager believes that the reason given by the company is insufficient, or if this information is not provided at the time of the notice of dismissal, the manager can apply to the Arbitration Court referred to in Article 19 (…).”

According to the Court of Cassation, the judges of the lower courts have rightly explained that:

• even though it was concise, the reason was clear, therefore, specific, and put the manager in the position to clearly understand the reason for dismissal and
• the company – in its defence brief – had clarified the characteristics of the reorganization and
• the pre-trial assessments had confirmed that the company had been reorganized.

In detail, the Court of Cassation, confirming its previous approach, remarked that a manager’s dismissal should be considered illegitimate – and consequently the employer obligated to pay the supplementary allowance provided under the Collective Labour Agreement – if this is not based on any reasons or is based on flimsy excuses and therefore untruthful reasons.

In the case at hand, instead, the dismissal had occurred due to the elimination of the position of Plant Manager, in consequence of the reorganization of the company. Moreover, the above dismissal was unavoidable given that, as specified in the notice of dismissal, at the time of the facts at hand there were no vacant positions available for the manager.

The Court of Cassation also confirmed that, in the pre-trial phase, it had been proven that following dismissal no other director had been hired in his stead and that plant management had been taken over by the two figures hierarchically above the dismissed manager.

In consideration of all of the above, the Court of Cassation confirmed the following principle of the law “If the ground of dismissal of a manager has not been given (or it is insufficient or generic) the employer may – in observance of the principle of cross-examination pursuant to Article 19 (3) of the aforementioned National Collective Labour Agreement for Industrial Managers – make it explicit (or supplement it) within the context of arbitration proceedings; in addition, where the manager elects – in observance with the principle of alternation of available guarantees in labour disputes – to directly apply to an ordinary court of law – the same rights should be recognized to the employer in the course of the legal proceedings.” Otherwise, according to the Court of Cassation, the position of the employer would be compromised as an effect of an autonomous and unquestionable determination of the counterparty.