The Court of Rome’s judgment, rendered on 26 February 2021, affirmed that the ban on dismissals for objective reasons (economic and reorganisational purposes), originally introduced by article 46 of Legislative Decree n. 18/2020 in response to the economic consequences of the COVID-19 pandemic, and prorogated by the Financial Act 2021, Law n. 178 that was passed on 30 December 2020, shall apply as well to the dismissal of an executive (dirigenti).
As of March 17th 2020 art. 46 of Legislative Decree n. 18/2020 introduced a dismissal ban for objective reasons aimed at facing the economic consequences of Covid-19 spread. Since mentioned art. 46 of Legislative Decree 18/2020 was expressly referring to Article 3 of Law No. 604 of 15 July 1966, which rules the dismissal for objective reason of workers and employees, the case law and the doctrine have considered executives (dirigenti) excluded from the mentioned ban.
However, the Court of Rome by judgment issued on February 26, 2021 established that the dismissal ban, applies also to executives individual dismissals. Therefore, the Court ordered the reinstatement of an executive dismissed in July 2020, pending the ban, for suppression of his job position.
The Court reasoning was that the ban intended to protect workers against the economic consequences of the pandemic resulting in the suppression of jobs, without introducing different protections between some categories of workers and others. The protection is so held to be common to all workers including executives, whose exclusion, the Court maintains, would be in contrast with Article 3 of the Italian Constitution (that sets forth the so called Equality principle).
The Court also reasoned that there would be an incomprehensible discrepancy in the fact that executives, to whom is applicable the temporary dismissal ban in case of collective dismissal, based on an equal economic justification of the termination, would not be entitled to any special protection in case of individual dismissal.
Therefore, the Court considered that the reference of the emergency legislation banning dismissal pursuant to article 3 of Law 604/1966, which rules the individual dismissal for objective reasons but certainly does not apply to executives, is only aimed at identifying the nature (objective) of the reason underlying the dismissal and not at delimiting the subjective scope of its application (that would lead to executives exclusion from any emergency protection).
Such an interpretation of the ban, however, does not persuade.
In fact, as mentioned above there is a clear textual reference in article 46 of Legislative Decree n. 18/2020 to a dismissal prohibition that is pursuant to article 3 of the Law number 604/1966 and this prohibition has been extended by successive legislative acts that always made reference to a ban against dismissal pursuant to said article 3.
Moreover, the dismissal ban that is heavy hardship imposed on companies, temporary limiting their Constitutional right under article 41 which protects their rights to freely organize themselves and their productive structure, has been admissible since counterbalanced by the Government introduction of special social measures (against Covid 19 caused production decrease) which help companies that if, one side, are prevented from dismissing, on the other side are allowed to suspend workers who may benefit of Government social aid in lieu of employer’s remuneration. Social measures are pacifically not provided for executives: so if the isolated Court of Rome judgment was correct, paradoxically an employer would be prevented from dismissing an executive but at the same time obliged to take over his payroll even in case of no work activity remaining, being impossible to have him admitted to social programs.
Moreover, the constitutionally oriented interpretation proposed by the Court with reference to article 3 of the Constitution does not convince. It appears that executives and other workers are in completely different positions under Italian law, under any point of view. Executives are systematically treated differently because their role is of fiduciary nature, underlying decisional power and higher salary than other workers. So, excluding them from the application of the dismissal ban would not be disparity in the treatment of equal situations but rather different treatment of situations substantially different.
In conclusion, it seems that we are in front of a judicial interpretation of a law that goes well beyond its will and that can constitute a precedent bringing into our law framework – already jagged due to a huge set of emergency rules passed in the last months – even more uncertainty.
LABLAW will continue to provide you with updates as the situation unfolds in order to ensure you can manage your workforce, and hence. Please do not hesitate to contact us on + 39 02 30 31 11 or at email@example.com if you have any questions. For more information on these articles or any other issues involving labour and employment matters in Italy, please contact Michela Bani (Partner) of LabLaw at firstname.lastname@example.org or visit www.lablaw.com.
For more information please contact Joseph Granato, Communications Manager at L&E Global at email@example.com.