The reference to “conciliation location” in Article 411 of the Italian Code of Civil Procedure does not permit company premises to be included among the protected locations (sedi protette), even if a union representative is present at the conciliation.
By order no. 10065 of 15 April 2024, the Italian Court of Cassation affirmed that a union negotiated conciliation agreement, under Article 411, paragraph 3 of the Italian Civil Procedure Code cannot be validly concluded at company headquarters. This is because company headquarters do not fall within “protected locations” (sedi protette) which are neutral and guarantee, together with the assistance provided by the union representative, that the worker is free to make his or her own decisions.
Union negotiated conciliation agreements: brief overview
As an alternative to a judge’s ruling, out-of-court conciliation has always been viewed favourably by the legislature for settling employment disputes. For these purposes, the legislature has introduced over time a number of useful tools: the conciliation attempt at the Local Employment Inspectorate (Ispettorato Territoriale del Lavoro, ‘ITL’), which is optional, and mandatory only in cases of certified contracts, under Article 410 ; conciliation in the context of an employment contract with progressive entitlement (Italian Legislative Decree no. 23/2015); the union negotiated conciliation attempt (Article 411, Italian Code of Civil Procedure); attempted court conciliation (under Article 185, Italian Code of Civil Procedure and Article of 420, Italian Code of Civil Procedure); conciliation at university locations; conciliation by single judge (Article 11, Italian Legislative Decree no. 124/2004); conciliation in arbitration under Articles 412-ter and 412-quater.
Most recently, with the Cartabia Reform (Italian Legislative Decree no. 149/2022), the legislature also extended assisted negotiation to employment disputes through the introduction of new Article 2-ter to Italian Decree-Law no. 132/2014 (converted into law no. 162/2014). The Reform aims to facilitate the settlement of the dispute by legal representatives of the parties who initiate such proceedings, without the presence of a third-party conciliator, prior to bringing the court action.
From an employment law point of view, Article 2113, Italian Civil Code provides, in general terms, that waivers and settlements of employee’s rights deriving from mandatory provisions of the law or collective bargaining agreements are invalid. The provision also guarantees the employee the possibility of challenging the settlement, by any written document, within six months from the termination of the relationship or the subsequent date of the settlement.
Indeed, the legal system considers that, in contrast to civil law negotiations (formal equality between the parties), in employment relations there is a substantial financial inequality between employer and employee. This inequality must be rebalanced through the declared protection for the employee, to avoid the agreement causing damage to the employee instead of guaranteeing and protecting his or her rights.
Notwithstanding the above, Article 2113, Italian Civil Code, as is well known, also provides that waivers and settlements are valid (and, therefore, can no longer be challenged) if they are entered into in the locations exhaustively identified by the legislator, i.e.:
- in court (Articles 185 and 420 Italian Code of Civil Procedure and 88, implementing provisions of the Italian Code of Civil Procedure);
- before the Conciliation Boards at the ITL or the Certification Boards (Article 410 and 411, Italian Code of Civil Procedure and Article 31, paragraph 13, l. no. 183/2010);
- before union representatives (Article 412-ter and 411, paragraph 3, Italian Code of Civil Procedure);
- at the informal Conciliation and Arbitration Boards (Article 412-quater Italian Code of Civil Procedure);
- during inspection process (Article 11, Italian Legislative Decree no. 124/2004);
- during assisted negotiation (Article 2-ter Legislative Decree no. 132/2014).
In these cases, the worker’s position is protected by the intervention of a third party, thereby ensuring that the worker is free to make his or her own decisions.
Recent case law is a real wake-up call for the employer, with particular reference to union assisted conciliation agreements, because it has held that such agreements are totally unchallengeable because they were signed in a protected location.
In fact, there are an increasing number of rulings (not only at first instance, but also on appeal) that have held union negotiated settlement agreements to be invalid if they lack certain characteristics.
For a union negotiated settlement agreement to be considered valid, it must involve effective assistance from the conciliator to whom the worker has given specific mandate.
The effectiveness of the assistance derives from the role attributed to the conciliator. In addition, as the settlement cannot be appealed, the conciliator must inform the employee in advance of the scope of the rights accrued and divested or dealt with differently from as provided for by law or by the collective agreement, as well as the consequences of signing the union negotiated settlement (see amongst others: Italian Court of Cassation, order no. 16154 of 9 June 2021).
Continuing the review of rulings that have found that a union negotiated conciliation agreement can be challenged, reference is made to the Court of Bari’s judgment of 6 April 2022. This judgment affirmed that if the assistance to the worker, as part of a union assisted settlement, was provided by the representative of a union to which the employee did not belong, then the agreement is invalid and ineffective.
Moreover, the Court of Rome (judgment of 8 May 2019) went so far as to hold that for the agreement to be unchallengeable (as provided for in Article 2113, paragraph 4, Italian Civil Code), union negotiated settlement must be expressly provided for in the collective agreement applied by the employer, which regulates its locations and procedures under Article 412-ter, Italian Code of Civil Procedure.
In addition, the Italian Court of Cassation held that for a union negotiated conciliation agreement to be valid there had to be a specific union mandate given when the conciliation is imminent and supported by assistance provided by the union to which the worker belongs and not by others (Italian Court of Cassation no. 16168/2004).
In recent months, case law has also addressed the issue of the “location” where the union negotiated conciliation agreement must be signed for it to be unchallengeable.
Reference should also be made to two recent cases on the subject, which is also the subject of the order under discussion.
By order no. 25796 of 5 September 2023, the Italian Court of Cassation – upholding the Appeal Court ruling – ruled that a conciliation agreement entered into at the Prefecture’s offices with the assistance of a workers’ union representative was not unchallengeable under Article 2113, last paragraph, Italian Civil Code. This was because such an agreement could not be considered to have been concluded at a conciliation location as required by the terms of the sector collective bargaining agreement under Article 412-ter, Italian Civil Code.
Similarly, a few months ago, the Italian Court of Cassation, in order no. 1975 of 18 January 2024, ruled that the need for a union negotiated conciliation agreement to be signed at a conciliation location is not a formal requirement: rather it ensures the employee’s understanding of the deed dealing with his or her rights that he or she is about to sign and, therefore, ensures that he or she is entering into the conciliation agreement of his or her free will. Therefore, if this understanding is nonetheless acquired, for example through comprehensive explanations provided by the union conciliator appointed by the worker, the purpose intended by the legislature and the parties to the collective agreement must be said to have been achieved. In such a case, therefore, entering into the conciliation agreement in a location other than the union premises does not invalidate the settlement.
The facts of the case and judgment on the merits
The case related to this order originates from the signing of a conciliation agreement at the company’s premises, in the presence of the parties and the union representative.
In that agreement, the company “had committed not to carry out the pre-announced collective dismissals referred to in the letter starting the redundancy procedure on the condition that all employees accepted the proposed 20% decrease in monthly taxable salary for the period 1 March 2016 to 28 February 2018 with the possibility of extending the reduction for up to two more years”.
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