Legitimate dismissal even with a minimum reduction in revenue (Il Quotidiano del Lavoro de Il Sole 24 Ore, 1 August 2019 – Enrico De Luca, Antonella Iacobellis)

The Court of Cassation reiterated that the judge’s review cannot also concern the merits of the employer’s management choices, and a minimum reduction in revenue, if objectively linked to the expulsion measure, can be considered suitable to justify dismissal. The background that the Court of Justice, with its judgement of 18 July 2019, No 19302, examined was, very briefly, the following. A worker applied to the Court of First Instance for a declaration that the dismissal ordered to him was unlawful on the grounds that he was opposed to the employer’s decision to convert his employment relationship from full-time to part-time. The Court of Appeal, in confirming the first instance decision that had accepted the worker’s application, pointed out that it was obvious that the company’s balance sheet for the year prior to the dismissal had recorded a profit for the year and a reduction in liabilities. In addition, according to the District Court, the accounting entries and the depositions of the witnesses showed a slight decrease in profit from 2008 to 2010, although the operating results remained positive. And in order to face the described and slight negative drop in the profit margin, the employer decided to transform the employment relationship of some employees, including the complainant, from full time to part time. Therefore, the economic situation described above could not be considered as justifying the redundancy in question. The employer appealed against the decision on the substance of the case in Cassation on two grounds, the first of which relating to the incorrect assessment of the non-recurrence of the justified objective ground. In the first grounds for appeal, in other words, the conflict was declared between what was stated in the judgement under appeal and what was stated several times by the Court of Cassation, “according to which even reasons aimed at improving management efficiency or increasing the profitability of the business, which lead to a real change in the organisational structure through the abolition of a job, may justify individual dismissal on objective grounds”. In addition, the employer pointed out: – in a small company such as yours, not even the slightest but constant reduction in revenue from 2008 to 2010 can be underestimated;                                   – that it was only because of the worker’s failure to agree to move to a part-time scheme that he was dismissed for justified objective reasons. On this point, the courts of law have specified that the judicial review of the lawfulness of dismissal must be substantiated by verification: (i) the existence of the objective reason that the employer has declared to be the basis of the same; (ii) the existence of the causal link between the reason ascertained and the suppression of the employment position.