The Court of Cassation, with judgement No. 3186 of 4 February 2019, stated that dismissal based on a future corporate transfer (through merger) with consequent unification of departments, cannot be considered lawful, with the employee involved subject to the protections established by Article 18, paragraph 4, of the Law No. 300/1970 (the so-called attenuated reinstatement). This is because the case in question must be regarded as the equivalent of “clear non-existence” of the fact on which the dismissal was based.


The facts

A female employee, with an appeal filed under No. Law 92/2012, brought her case to court against her employer in order to obtain a ruling voiding, stating as ineffective or declaring as unlawful her dismissal. Specifically, she argued of having received respectively: (i) on 16 October 2014, a merely informative notification concerning the termination of her employment following the transfer of her tasks to the registered office of another company as a consequence of the merger by incorporation between the latter and her employer company; (ii) on 6 November, the letter of dismissal due to removal of her job position. Nevertheless, the employee pointed out that the merger by incorporation took place only on 24 November 2014, thus after her dismissal.


The employee also invoked the application of Article 2112, paragraph 4, of the Italian Civil Code, according to which a corporate transfer (equal to a merger) could not in itself constitute grounds for dismissal.


The Court ruled the dismissal void, ordering the reinstatement of the employee and the payment to her of the damage indemnity. In the Court’s opinion, in fact, dismissal was in conflict with Article 2112, paragraph 4, of the Italian Civil Code, since it had to be exclusively due to a corporate merger and in any case ordered in violation of the procedure set out in Law No. 223/1991.


At time of claim, the Court sided with the company, considering as proven the corporate crisis that had led to the removal of the job position in question, regardless of the merger and, therefore, excluding a violation of Article 2112 of the Italian Civil Code and the applicability of Law No. 223/1911.


The employee appealed against the first instance judgement. The local Court of Appeal in charge, overturning the judgment, declared the dismissal unlawful, thus issuing an order for reinstatement and an order for the company to pay a compensation equal to 12 months’ salary calculated on the basis of the total de facto remuneration pursuant to Article 18(1) of Law No. 300/1970, in addition to ancillary charges.


The company appealed to the Court of Cassation against the second instance judgement.


The ruling of the Court

The Court of Cassation confirmed the dismissal was unlawful since it did not appear that a loss of job position took place at the time of its notification, but at most a forthcoming transfer of tasks to another company.

In support of its opinion, the Court of Cassation made reference to a previous judgement according to which ”in the event of a corporate transfer, the transferor retains the power of withdrawal granted by the general regulations so that the transfer, although it may not be the only reason of justification, cannot prevent dismissal on justified objective grounds provided that can be identified in the corporate structure assessed independently and not in connection with the transfer or in the purpose of facilitating it”. (Court of Cassation, Civil Division No. 11410/18 and Court of Cassation, Civil Division No. 15495/18).

The Court of Cassation, however, upheld the company’s objection that the dismissal caused by the corporate transfer does not in itself void the dismissal with the consequent inapplicability of the protections provided for in Art. 18 of Law No. 300/1970.

According to the Court of Cassation, in fact, “Article 2112 of the Italian Civil Code only establishes that a corporate transfer does not in itself represent grounds for dismissal, and does not generally prohibit it, much less under penalty of voidance”. Therefore, in its opinion, the dismissal cannot be protected by the regime referred to in paragraph 1 of Article 18 of the Workers’ Statute. A paragraph that calls for reinstatement in the event of discriminatory dismissal or dismissal for unlawful reasons or “in the other cases of voidance provided for by law”. This is specifically because Art. 2112 of the Italian Civil Code de quo calls for its voiding the effects for lack of a justified reason.

Consequently, in its opinion, the case under review must be considered under the scenario of “clear absence of the fact” on which the dismissal for justified objective reasons was based, as per the second sentence of Article 18, paragraph 7 of the Law No. 300/1970. This was because it was proven that, at the time of dismissal, the reasons for it did not exist, since they were simply linked to a future grouping of tasks which would, moreover, achieved through a future corporate merger. A merger that in turn did not constitute in itself justified grounds for dismissal pursuant to and by effect of Article 2112, paragraph 4, of the Italian Civil Code.

According to the Court of Cassation, the judgment under appeal should have fallen under the protection provided for in paragraph 4 of Article 18 of Law No. 300/1970 with voiding of the dismissal and order to reinstate the employee and to pay full remuneration calculated effective from the date of dismissal until the date of reinstatement, deducting any aliunde perceptum o percipiendum, in any case not exceeding 12 months’ salary of the actual remuneration, in addition to the payment of social security contributions as established by the aforementioned Article 4.



The judgment in question shows that the transferor company may dismiss an employee on justified objective grounds only if the corporate transfer takes place at a time prior to that of the dismissal itself. Lacking that, the risk is to incur the consequences referred to in Article 18, paragraph 4, of the Workers’ Statute (the so-called attenuated reinstatement).


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