With ruling no. 2629 of 10 November 2021, the Court of Milan considers that the dismissal prohibition introduced by the emergency legislation applies to executives.
Facts of the case
With an appeal under art. 414 of the Italian Code of Civil Procedure, an executive requested the Court of Milan to ascertain and declare the nullity of his dismissal for breach of the emergency regulations. Furthermore, he asked for reinstatement and compensation for damages equal to an indemnity proportional to the last total salary from the dismissal date to the reinstatement date and no less than five months’ salary, plus interest and revaluation from the date of settlement accrual and payment of social security contributions.
The executive’s former employer, which appeared before the Court, requested the rejection of the claims submitted by the manager.
The Court’s decision
In upholding the executive’s appeal, the Court pointed out that the dismissal letter showed that the executive had been dismissed for cost containment to manage the company more profitably, which was linked to the COVID-19 health emergency. The dismissal letter stated that “within twelve months, (…) he would have reached the age of 67, the age set by law for obtaining the pension, receiving the relevant emoluments and the indemnity instead of notice.”
According to the Court, it is clear from the letter of dismissal that this was not an ad nutum dismissal but an ineffective dismissal for financial reasons.
As far as we are concerned, the Court observed that the dismissal prohibition during the emergency period applies to executives. The interpretation according to which this prohibition would not apply to them cannot be reasonably confirmed by a constitutionally oriented understanding of Art. 14 of Decree Law no. 104/2021.
The reference to art. 3 of Law 604/1966 to identify the type of dismissal covered by the prohibition, namely dismissal for objective reasons, “is intended solely to identify the type of dismissal covered by the prohibition, namely dismissal for objective reasons, based on the reasons given in the termination notice.” The fact that the rules on dismissals apply only to managers, clerks and workers is irrelevant since the legislature intended to prohibit all “financial-based” dismissals. The reference made by art. 4 of Law 104/2020 is only to art. 3 and not to the entire Law 604/1966.
In addition, it is common ground that executives are subject to the rules governing collective redundancies. According to the Court, it was illogical to exclude executives from the dismissal prohibition scope, which includes their collective dismissal.
That conclusion appears to be supported by applying the protection’s sanctioning system for executives’ null and void dismissal because it was made in breach of a prohibition laid down by a mandatory rule.
According to the Court, the justified reason supporting an executive’s dismissal cannot be disregarded under Art. 5 of Law 604/1966. “The contractual justified reasons legitimising executive dismissals are contained in the less extensive objective justified reason for dismissal.”
Excluding executives from dismissal prohibition was inconsistent with a constitutionally-oriented interpretation of the rules concerning the principle of equality and reasonableness. The Court referred to the Court of Cassation, which stated different rules could be applied to executives “provided that they are situations capable of justifying an exceptional regime regarding other appreciable interests and the limits of reasonableness are not exceeded.”
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This ruling is part of the case law debate in which the Court of Rome, by order of 26 February 2021, firstly declared illegitimate the individual dismissal for financial reasons of an executive during the period when the dismissal prohibition was in force and then, by decision of 19 April, legitimised that type of dismissal.
Altri insight correlati:
In its ruling no. 376 of last 23 November, The Court of Florence declared the unilateral terminations made by a digital platform of home food deliveries (the “Company“) from the relationships in place with individual workers (“riders“) ineffective, following a failure to adhere to the National Collective Labour Agreement (the “NCLA“) signed by Assodelivery, the trade association representing the Italian food delivery industry to which the Company belongs, and UGL rider – the trade union.
The matter arose in October 2020 after the stipulation of the NCLA with UGL through Assodelivery, the Company sent a communication to (about 8,000) riders asking them to sign a new work contract as an essential condition for continuing the relationship.
With an appeal filed on 25 February 2021, the trade unions FILCAM CGIL FIRENZE, NIDIL CGILFIRENZE and FILT CGIL Firenze brought an action against the Company opposing the decree under art. 28 of the Workers’ Statute issued on the previous 9 February by which the appeal brought by the same parties for the alleged anti-union conduct of the Company was rejected, which was based on:
The Court of Florence clarified that riders must be considered employees, and the management of the relationship with them must be subject to the relevant rules, including those on termination.
As for the notice sent by the Company, the Court found (i) there was no consultation with the trade unions that the Tertiary Distribution and Services would have been required by the Collective Labour Agreement applied to its employees and (ii) it was intended to simultaneously terminate the relationship with more than 8,000 riders, constituting a “significant change in the company organisation.”
According to the Court, since it was undisputed (because it was uncontested) that some riders equal to or greater than five had prematurely terminated their employment following the Company unilateral change, the procedures provided for by Law 223/1991 should have been used, including “prior written notice (in the absence of rsa or rsu – union representatives) to the trade associations belonging to the most representative confederations at a national level.”
According to the Court, the plaintiff associations fall within the scope of the recipients of the above communication as they are trade associations. Furthermore, each of them has multiple-factor organised and quasi self-employed workers who are members of a confederation such as CGIL, which is representative at a national level.
The Court of First Instance observed that elements such as how the agreement was signed, the lack of discussion between the union and riders, absence of disputes brought by UGL, contract content that excluded UGL from the European Economic and Social Committee and the failure to continue negotiations with other trade unions to stipulate further and different contracts, were “unequivocal and concordant elements in favour of the union’s (UGL rider) unrepresentative nature and the discriminatory nature of the privileges granted to it which were unjustified by the union’s bargaining strength.”
On these grounds, the Court, accepting the union representatives’ appeal, ordered the Company to immediately cease the anti-union conduct, condemning it to initiate the consultation and discussion procedures provided for by the Tertiary Distribution and Services Collective Labour Agreement and the information and consultation procedures under Law 223/1991. In addition, the Company was ordered to publish the full decree text at its own expense and once in some specific local newspapers and pay the costs of the proceedings (including the summary stage) to the plaintiff union.
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The order to immediately cease applying the Ugl rider NCLA remains, to date, limited to the local jurisdiction of the Court of Florence, which has ruled on the matter.
Other related insights:
With its order no. 30478 of 28 October 2021, the Court of Cassation ruled that the employer is not obliged to warn the employee who cannot work about the imminent achievement of the maximum relationship protected period, nor to suggest alternative means to the absence due to illness (holidays, leave of absence).
The case originates from an appeal against an employee’s dismissal for exceeding his protected period, which was based on the concept that the employer should have informed him of the imminent expiry of his protected period.
The Court hearing the case, declared the dismissal unlawful, while the Court of Appeal overturned the decision of the first instance. The unsuccessful employee appealed to the Court of Cassation.
The Court of Cassation confirmed the dismissal’s legitimacy, and noted that in the absence of any obligation under the collective bargaining agreement, the Company did not have to warn the employee of the imminent expiry of the protected period for illness to allow the employee to exercise the right to request a leave of absence.
According to the Court of Cassation, the dismissal in question is justified by the prolonged objective absence due to illness, exceeding the maximum duration set out in the sector NCLA and, therefore, the impossibility to work. Such dismissal was not disciplinary and prior notification of absence is not required. The employer did not have to provide the employee with a list of absences at the time of dismissal but only if requested after the dismissal.
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With its order no. 28606/2021, the Court of Cassation returned to the issue of leave under Law no. 104/1992, stating that the requesting employee must guarantee continuous and global assistance to the disabled family member, although they may devote a limited time to their personal needs during the leave. If the causal link between the absence from work and the assistance to the disabled person is entirely lacking, this constitutes improper use of the leave (or abuse of right) or a serious breach of the duties of fairness and good faith towards the employer and the insurance company, resulting in the employee’s liability.
An employee was dismissed for just cause because, on the day of leave granted to assist his severely disabled mother, he was found working in his wife’s shop. To prove that he was assisting his mother, the employee stated that he had stayed at her home for about 50 minutes to prepare a meal for her. The Court of Appeal, reforming the decision of the Court of First Instance, declared the dismissal to be lawful, considering that it had been proved that the employee had carried out activities unrelated to the necessary family assistance on the day of leave. According to the Court, this behaviour had irreparably damaged the bond of trust. The worker appealed to the Court of Cassation.
The Court of Cassation, in considering the dismissal lawful, noted that under Law no. 104/1992, leave must always have a causal link between absence from work and assistance to the disabled person. According to the Court, the worker must guarantee continuous and global assistance to the disabled family member, however, during leave, can devote a limited time to his personal needs. The absence of a causal link leads to the conclusion that the leave is improper and the employee’s breach of his duty of fairness and good faith is serious, giving rise to his liability.
Leave under Law no. 104/1992 must be used following its function and in the presence of a causal link with the assistance activity for which it was granted. This leave cannot be used for different needs (whatever they may be) than those related to the function for which it is intended. This is because the benefit entails an organisational sacrifice for the employer that can only be justified in the presence of needs recognised by the worker and social conscience as deserving of protection.
Other related insights:
With its ruling no. 33809 of 12 November 2021, the Court of Cassation stated that an employee who deletes or transfers company data outside is engaging in disciplinary conduct and a civil and criminal offence. The employer may legitimately acquire and produce the private correspondence found after the Company’s personal computer is returned and present this evidence in Court to prove the employee’s unlawful conduct. The right to defence in Court prevails over the inviolability of correspondence.
In this case, a manager, after resigning, returned to the company the personal computer assigned, completely formatted and without any document, data or company information. The employer then turned to a computer expert to recover the data and information deleted by the former employee.
After retrieving the password to access the Skype platform, the expert found some conversations had by the former employee with parties outside the company organisation (including competing companies), revealing the perpetration of a series of disloyal and illegal conducts. The Company filed a claim for compensation for the damages allegedly suffered because of the manager’s conduct.
The Court of Appeal of Turin, overturning the first instance court’s decision, held that the Company’s claim was unfounded, ruling out the existence of any evidence of the employee’s allegedly unlawful conduct and consequently the right to compensation for the damages claimed. The Court of Appeal considered the conversations acquired by the Company on the manager’s Skype account unusable in Court, as they were obtained in violation of the secrecy of correspondence and without his consent.
In overturning the Court of Appeal’s decision, the Court of Cassation found that the employee conduct damaged the Company’s assets. This was relevant not only in civil law terms, with the consequent right of the employer to compensate for the damage suffered, but in criminal law, as it constituted an offence provided for in Article 635 bis of the Italian Criminal Code (i.e. damaging information, data and computer programs). According to the Court of Cassation, the employee conduct is relevant from a disciplinary point of view as it was contrary to the obligations of loyalty and diligence.
As for the legitimacy of documents containing personal data produced in legal proceedings, the Supreme Court, referring to previous decisions, affirmed that this “is allowed when necessary to exercise one’s own right of defence, even in the absence of the owner’s consent and any method used to acquire their knowledge. However, defending oneself in legal proceedings, using the others’ personal data, must be exercised regarding the duties of correctness, pertinence and non-excessiveness (…). Document production legitimacy must be based on the balance between the content of the data used, to which the degree of confidentiality must be applied, and the defence needs.”
As for the personal data processing, the Court stated that “the right to defence in Court prevails over the right to inviolability of correspondence, allowing art. 24, letter f) Law 196/2003 to disregard the data subject consent for personal data processing, when it is necessary to protect a right in Court.” The Court continued, “This is conditional on data being processed exclusively for that purpose and the period strictly necessary for its pursuit.“
According to the Supreme Court, the right of defence would not be limited to the legal proceedings stage, as it could be extended to evidence gathering in the procedure, even before a dispute has been formally established.
Finally, the Court of Cassation, in explaining its decision, confirmed the legitimacy of the checks carried out by the employer under the rules contained in art. 4, Law no. 300/1970 (applicable ratione temporis), finding the checks “defensive” in nature. According to the Court, the checks took place after the employment termination and after the commission of the harmful act which consisted of deleting company data by the manager.
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