In its recent order No. 19023 of 5 July 2023, the Italian Court of Cassation has ruled on geographical jurisdiction under Article 413 of the Italian Code of Civil Procedure. The Court ruled that the worker’s home, from which he performed his work through remote working, could not be classified as a company dependence in the absence of any objective or subjective connection of the place of performance of the service with the company.
The facts of the case
The case originates from a payment order issued by the Court of Rome in favour of a temporary worker. The employer had been ordered to pay the worker compensation arising from the nullity of the temporary employment contract and for the continuation of the activity beyond the expiry of the time-limit, with the consequent transformation of the temporary employment contract into a permanent employment contract.
The company challenged the payment order, asking for a preliminary determination that the Court of Rome did not have geographical jurisdiction over the matter and that, in the alternative, jurisdiction rested with the Court of Genoa, as the worker’s location of operational and effective activity, or the Court of Udine, as the place where the company had its registered office.
In this application the Court of Rome declared its lack of geographical jurisdiction, holding that jurisdiction rested, alternatively, with the Court of Genoa or Udine, as well as the Court of Civitavecchia, as the worker was resident in Civitavecchia and performed his work through remote working from his home.
The appeal to the Italian Court of Cassation and the decision taken by the Court
The company appealed against that judgment by way of a single legal ground, in which it objected to the erroneous interpretation of the law and of the established case-law regarding the determination by the Court of Rome of the jurisdiction of the Court of Civitavecchia.
The company pointed out, in fact, that there was no basis for establishing jurisdiction in the Court of Civitavecchia, since there was no nucleus of assets organised for the exercise of the business at the employee’s home, thus excluding jurisdiction at the place where remote working was carried out.
The order issued by the Italian Court of Cassation starts from an analysis of Article 413 of the Italian Code of Civil Procedure, which states that the employment judge has geographical jurisdiction alternatively in the place where the relationship was established in the place where the company is located, or, finally, in the place where the company dependence to which the employee is attached is located.
According to the ruling of the Italian Court of Cassation under comment, with specific reference to ‘company dependence’, reference must be made to the place where the employer has located a nucleus, albeit modest, of assets organised for the exercise of the business (Italian Court of Cassation No. 14449/2019; Italian Court of Cassation No. 4767/2017).
Where, on the other hand, as in the case in question, the remote working takes the form, according to the employee, solely of the place where the service is carried out, without any other related aspect that in any way characterises the home as a company dependence, then this criterion cannot be taken into consideration for the purposes of identifying geographical jurisdiction. Consequently, the only criteria which remain applicable are represented by the place where the contract was concluded or the place where the employee was employed.
As a result, the Italian Court of Cassation upheld the Company’s application on the question of jurisdiction, declaring the alternative geographical jurisdiction to be exclusively the courts of Udine and Genoa but not the court of Civitavecchia.
Other related insights:
The ‘Employment Decree’ (Italian Decree Law No. 48/2023) was converted into Italian Law No. 85 of 3 July 2023, which introduced important innovations for employers.
Below is an analysis of the main changes introduced in the field of: (i) forward contracts; (ii) staff-leasing contracts; (iii) the right to ‘remote’ working.
As regards fixed-term contracts, the converting law confirms the new grounds that employers shall be required to use in the event that the duration of a fixed-term contract exceeds 12 months (also as a result of extensions or renewals). The new grounds concern:
The converting law also provides for more flexibility regarding renewals. In particular, without prejudice to the maximum time limit for fixed-term contracts (i.e., 24 months), a fixed-term contract can be renewed ‘freely’ within the first 12 months of the relationship’s duration (thus, de facto equating the rules on renewals with those on extensions).
Lastly, it is clarified that only contracts entered into after 5 May 2023 are to be taken into account for the purpose of calculating the twelve months.
Other new features concern the regulation of open-ended staff leasing, for which the converting law of the ‘Employment Decree’ provides for workers hired by the staff-leasing agency with apprenticeship contracts and ‘disadvantaged’ jobs to be excluded from the 20% quantitative limit.
Finally, on the subject of ‘remote working’, the converting law further extends the right to ‘remote working’ for certain categories of workers and, in particular:
Other related insights:
DID YOU KNOW THAT… On 5 May 2023 the so-called ‘Employment Decree’ came into force?
By Law converting, with amendments, Decree-Law no. 48/2023 – (the ‘Employment Decree’ (‘Decreto Lavoro’)) containing ‘Urgent measures for social inclusion and access to the workplace’ – which has been approved by the Italian parliament and is currently scheduled to be published in the Italian Official Gazette (“Conversion Law“) – the right to remote working will be extended:
It should be noted that the above-mentioned Decree of the Minister of Health, February 4th, 2022 – converted, with amendments, by Law no. 11 of February 18th, 2022 – identifies the conditions of the subject and the chronic pathologies with low clinical compensation and with a particular connotation of seriousness under which the employee’s primary care physician certifies the situation of vulnerability for the purposes of the application of certain transitional rules of favor (Please refer to Article 28-bis of the Conversion Law).
(Please refer to Article 42, 3-ter, of the Conversion Law).
Altri insights correlati:
Contribution and tax relief introduced by the budget law and extension of remote working for vulnerable persons
DID YOU KNOW THAT… On 5 May 2023 the so-called ‘Employment Decree’ came into force?
Italian Law of 24 February 2023, No 14 converted into law, with some modifications, Italian Decree-law of 29 December 2022, No 198, containing ‘urgent provisions regarding legislative deadlines. Extension of deadlines for the exercise of legislative powers’ (the so-called Milleproroghe Decree) published in the Italian Official Gazette No 49 of 27 February 2023:
Public and private employees are considered ‘vulnerable’ if they are affected by sicknesses and conditions identified by the decree of the Minister of Health referred to in Article 17, paragraph 2, of Italian Decree-law of 24 December 2021, No 221, converted into law, with amendments, by Italian Law of 18 February 2022, No 11. This right must be guaranteed including, if necessary, through assignment to a different job without any reduction of the salary and without prejudice to the application of any more favourable provisions set out in the relevant national collective bargaining agreement (contratto collettivo nazionale di lavoro, ‘CCNL’).
Finally, with the above-mentioned conversion Law, the right to remote working is renewed for parents who are private sector employees with at least one child under the age of 14, a protection that had last been extended until 31 December 2022.
In the latter case, said right to remote working arises where the following conditions are met:
Other related insights:
On 29 December 2022, Italian Law No 197/2022, entitled ‘State budget for the financial year 2023 and multi-year budget for the three-year period 2023-2025’ (‘Bilancio di previsione dello Stato per l’anno finanziario 2023 e bilancio pluriennale per il triennio 2023-2025’ – hereinafter ‘Budget Law’) was published in the Italian Official Gazette.
The above-mentioned legislation, among the various measures, introduced some contribution exemptions for the year 2023. In particular, employers who in 2023 hire workers under the age of 36 under a permanent employment contract will be able to benefit from total exemption from social security contributions up to a maximum amount of EUR 8,000 for a maximum period of 36 months. This exemption is also granted for fixed-term contracts which are converted into permanent contracts in the same year. The relief in question is granted (and this is new) also in the case of employment of persons who receive ‘citizenship income’ (‘reddito di cittadinanza’).
In addition, the above-mentioned contribution benefit is guaranteed if the permanent contract (or the contract that is converted into a permanent contract) concerns female workers who, regardless of age, have been (i) unemployed for at least 24 months or (ii) unemployed for at least six months if they are resident in ‘disadvantaged’ (‘svantaggiate’) areas.
The reliefs introduced do not only concern social security contributions but also those relating to tax. On this point, in fact, the Budget Law reduces the tax rate on ‘productivity bonuses’ (‘premi di produttività’) which goes from 10% to 5% up to a maximum amount of EUR 3,000. The tax relief therefore applies to performance bonuses of variable amounts whose payment is linked to increases in productivity, profitability, quality, efficiency and innovation, as defined in the context of a corporate or territorial collective agreement. This relief applies to those who in the previous year have earned employee income not exceeding EUR 80,000.
Finally, the Budget Law extended until 31 March 2023 the right for ‘vulnerable’ (‘fragili’) workers to work through remote working. For the other categories of workers, on the other hand, remote working is permitted only after signing an individual agreement between the employer and the employee under Articles 18 et seq. of Italian Law No 81 of 22 May 2017.
