By order no. 10663 of 19 April 2024, the Italian Court of Cassation stated that the employer bears the burden of proof in proving that remuneration has been properly paid.
The worker filed an application for summary judgment to obtain an order against the company to pay the amount indicated in the November 2015 pay slip.
In the first instance, the first instance Court found that the payment was due to the worker.
The company appealed to the Court of Appeal. The Court of Appeal upheld the first instance decision, ruling that the employer had not discharged its burden of proof relating to proving in court that the sum had been paid.
The Italian Court of Cassation – confirming the Court of Appeal decision – preliminarily noted that, once the existence of an employment relationship has been ascertained, the employer is under a strict duty of proof to establish that the remuneration has been paid. The employer can do this by means of the normal documentation i.e., regulatory pay slips bearing the worker’s signature. If the employer cannot prove that it has paid the remuneration due to the employee through pay slips, it must provide appropriate documentation of the relevant payments that it has made in relation to the employee’s individual claims.
According to the Italian Court of Cassation, giving employees at the time of payment of remuneration a statement containing an indication of all the constituent elements of the remuneration does not prove payment where the worker states that it is inconsistent with the remuneration actually paid.
According to the Italian Court of Cassation, the burden falls on the worker only if he/she, after signing the pay slip, alleges that the remuneration indicated in the pay slip is inconsistent with the remuneration paid.
As the present case did not fall within the latter situation, the Italian Court of Cassation rejected the company’s appeal.
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Conciliation agreements negotiated with the help of a union cannot be validly concluded at the company’s 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.
The Italian Court of Cassation affirmed this principle in order no. 10065 of 15 April 2024. This is a more restrictive interpretation than that laid down in order no. 1975 of 18 January 2024. According to the Court the locations selected by the legislator are exhaustive and do not permit substitutes, both because they are directly linked to the body responsible for conciliation and because of the aim of guaranteeing the worker a neutral environment, without employer influence.
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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.
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 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 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”.
Continue reading the full version at Modulo Contenzioso 24of Il Sole 24 Ore.
In judgment no. 32412 of 22 November 2023, the Italian Court of Cassation dealt with the lawfulness of a dismissal by the formal employer of a worker employed under a sham outsourcing contract.
A worker brought legal proceedings to obtain a declaration of the existence of an employment relationship with the principal company, and that, consequently his dismissal was ineffective because it was ordered by the contractor and not by the ‘actual’ employer. The worker also sought reinstatement. The Italian Court of Cassation, hearing the case, first affirmed that the worker was not precluded from bringing legal proceedings for a declaration of the existence of a sham intermediary and to obtain the recognition of an employment relationship with the principal including in the event of dismissal by the contractor. The Italian Court of Cassation also established that in the case of a sham intermediary, the power to dismiss must in any case be exercised by the actual employer and not by the sham one, under penalty of ineffectiveness of the dismissal; the actual employer, in fact, cannot rely on the contractor’s dismissal as an act affecting management of the relationship.
On Wednesday 24 April 2024, MEPs adopted the text of the new Directive on the working conditions of platform workers. As can be learned from the press release published on the Parliament’s institutional website, the Directive “aim[s] to ensure that platform workers have their employment status classified correctly and to correct bogus self-employment”by introducing “a presumption of an employment relationship (as opposed to self-employment) that is triggered when facts indicating control and direction are present, according to national law and collective agreements […]”.
Among the initiatives introduced by the Directive, as far as is of interest here, there are limitations on the processing of personal data carried out by means of automated monitoring or decision-making or systems. For example, the following may not be subject to any processing operation: (i) data on the emotional or psychological state of the person performing platform work; (ii) personal data in relation to private conversations; (iii) data belonging to the category of special data (former sensitive data) or biometric data or, again, (iv) the data of the worker who carries out activities through a digital platform may not be collected when he or she is not carrying out his or her activity through the platform itself.
These provisions will apply from the start of the recruitment and selection procedures and for the entire duration of the relationship. It is understood that, given the type of processing and the high risk to the rights and freedoms of natural persons, processing of personal data by a digital work platform will be subject to specific impact assessments under Article 35 of Regulation (EU) 2016/679. The impact assessments carried out by the employer will then have to be shared with the workers’ representatives.
Another key element is the transparency obligations. Persons who perform work through digital platforms will have to be promptly made aware, in a transparent, intelligible and easily accessible form using clear and plain language, about the categories of decisions that are taken or supported or by automated decision-making or monitoring systems. The Italian national legal system is already familiar with this aspect following the introduction of the provisions of Regulation (EU) 2016/679 and the adoption of the so-called “Transparency Decree”.
Finally, it is understood that Member States will have to ensure that digital work platforms guarantee sufficient human resources to effectively monitor and assess the impact of individual decisions taken or supported by automated decision-making or monitoring systems.
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Next steps
The text approved by the European Parliament will now also have to be formally adopted by the Council and then published in the Official Journal of the European Union. After publication, each Member State will have two years to incorporate the new provisions into its national law.
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