The Italian Court of Cassation in its very recent judgment No. 20239 of 14 July 2023 ruled on the issue of an employer’s withdrawal ad nutum that was given on the basis of a trial period agreement, which was declared null and void, stating that, where the dismissal does not fall under any of the cases referred to in Article 3(2) of Italian Legislative Decree 23/2015, the only protection applicable to the employee is indemnity.
The facts of the case
The case involved the dismissal of an employee for unsuccessful outcome of the trial period. The relevant employment contract had been entered into on 3 August 2015 with effect from the following September and with consequent application of the regulations on dismissals set out in Italian Legislative Decree 23/2015 (the so-called Jobs Act).
In the context of the proceedings on the merits, it was found that the trial period agreement set out by the contract was null and void for the failure to indicate the specific duties to which the employee would be assigned, and the professional profile assigned to her.
With reference to the consequent penalties, both the Court and the Court of Appeal had ruled that the consequences of the unlawful termination by the employer on the basis of a null and void trial period agreement did not fall within the scope of the circumstances governed by Article 3(2) of Italian Legislative Decree No. 23 of 2015, entailing the application of the effective protection, but regulated by Article 3(1) of the aforementioned decree, with the application, therefore, only of the so-called indemnity protection, in practice set at four months’ pay of the actual overall pay.
The application to the Italian Court of Cassation and the Court’s ruling
The employee lodged an application with the Italian Court of Cassation against the decision of the Court of Appeal, and put forward a number of grounds for contesting the ruling on appeal.
Indeed, the employee argued, firstly, that due to the lack of a valid and effective trial period agreement, the dismissal given for unsuccessful outcome of the trial period should have been declared null and void, with the consequent application of full reinstatement protection, pursuant to Article 2 of Italian Legislative Decree 23/2015.
In the alternative, the employee criticised the judgment on the ground that the Court of Appeal had held that the protection under Article 3(1) of Italian Legislative Decree 23/2015 was to be applied instead of the reduced reintegration protection, pursuant to the second paragraph of Article 3 of the aforementioned provision.
The Italian Court of Cassation rejected the employee’s plea on the basis of several findings.
The Court first observed that the nullity of the clause of the trial period agreement, given that it was partial, does not extend its effects to the entire contract, but pertains to the final employment from the outset, in accordance with Article 1419, paragraph 2, of the Italian Civil Code.
It follows from this, on the one hand, that the regime of free withdrawal no longer applies and, on the other hand, that the employer’s termination must be equated with an ordinary dismissal subject to judicial examination as to whether there is just cause or justified reason.
Thus, continues the Court, in the system introduced by Italian Legislative Decree 23/2015, the specific case cannot be traced back to the scope of the invalidity of the termination governed by Article 2 of the aforementioned decree, this rule being only applicable ‘to the case of discriminatory dismissal and the other cases of nullity expressly provided for by law’.
Having ruled out the application of Article 2, the Court consequently examined Article 3 of the so-called Jobs Act in order to verify the protection applicable to the case at hand.
The Italian Court of Cassation noted how, in the regulatory framework of the Jobs Act legislator, reinstatement protection is merely residual in nature, being applicable only to cases of dismissal for justified subjective reason or for just cause in which the lack of the material dispute of fact contested against the employee is proven in court (Article 3(2), Italian Legislative Decree 23/2015).
It follows – the Italian Court of Cassation continues, that the withdrawal ad nutum given without a valid trial period agreement, since it does not fall under any of the specific cases referred to in the second paragraph above, is to be considered to be subject to the general rule of indemnity protection under Article 2(1) of Italian Legislative Decree 23/2015.
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