ITALY: 2025, LOOKING AHEAD

The new article by Angelo Zambelli is published in the L&E Global website.

 

Several and significant legislative interventions have been introduced in the course of the year 2024, and they are expected to have a notable impact in the world of employment in Italy in 2025.

The Italian government has confirmed the reform commenced in 2024 of the provisions relating to fixed-term employment contracts.

The Ministerial Decree of 29 February 2024, entered into force on 5 April 2024, has at last implemented the Digital Nomads Visa, first introduced in the Italian system in 2022.

Moreover, the Senate Bill No. 1264 (so-called “DDL Lavoro”) concludes a legislative process that introduces significant updates to labour law, addressing contemporary labour market needs by covering a broad spectrum of issues.

In addition to that, during 2024 the Italian Constitutional Court again reviewed, more than once, the Legislative Decree no. 23/2015 (Provisions on permanent employment contracts with increasing protection over time, implementing Law no. 183/2014, the so-called “Jobs Act”), with rulings that, in all cases, have had a significant social impact.

 

Interventions of the Italian Constitutional Court on the so-called “Jobs Act” in 2024

Decision no. 7/2024: Articles 3, paragraph 1, and 10, of Legislative Decree no. 23/2015 are lawful

The Constitutional Court, with judgment no. 7 of 22 January 2024, ruled on the constitutional legitimacy of the abolition of reinstatement for unjustified dismissals for objective reasons for employees hired after 7 March 2015.

The case under exam originated from the question of constitutional legitimacy raised by the Court of Appeal of Naples, with reference to Articles 3, paragraph 1, and 10 of Legislative Decree no. 23/2015, insofar as they provide only for the indemnity protection in case of unlawful collective dismissals of employees hired after March 2015 for the breach of the selection criteria, in line with what is provided in case of individual dismissals for objective reasons.

Specifically, the Court of Appeal, in relation to the challenge of the dismissal of an employee hired in 2016 following a collective dismissal procedure for “staff reduction,” found that a different treatment based on the time of hiring within the same redundancy procedure would result in “an unreasonable disparity of protection […]” and that such treatment constitutes “a diminution of the compensation for the damage caused, to the extent that it does not guarantee an effective and adequate sanction in case of violation of the selection criteria.”

The Italian Constitutional Court stated that “different treatment applied to the same situations, but at different times, does not, by itself, constitute a breach of the equality principle, as the passage of time may constitute a valid element for differentiating legal situations.”

By expressing the above conclusions, the Constitutional Court provided that the regime introduced by Legislative Decree no. 23/2015 is not unreasonable and that the indemnity protection currently afforded to an unlawfully dismissed employee, as a result of a staff reduction procedure, is adequate.

 

Decision no. 22/2024: Article 2, paragraph 1, of Legislative Decree no. 23/2015 is unconstitutional

With judgment no. 22 of 22 February 2024, the Constitutional Court declared unconstitutional Article 2, paragraph 1, of Legislative Decree no. 23/2015, as regards the part that provides for reinstatement only in the cases of voidance of the dismissal “expressly provided for by law.”

The case under exam concerned the compliance with Italian Constitution of Article 2, paragraph 1, of Legislative Decree no. 23/2015, initiated by the Supreme Court with referral order of 7 April 2023.

In particular, the Supreme judges took as a basis the decision of the Florence Court of Appeal that—having found that the dismissal of an employee was null and void due to the breach of the special regulations applied to him—had not granted him the reinstatement but only the indemnity protection.

The Court of Appeal justified its decision on the grounds that (i) Article 2, paragraph 1, of Legislative Decree no. 23/2015 “provides for the reinstatement of the employee only in cases of discriminatory dismissal” or “in the other cases of voidance expressly provided for by law” and (ii) in that case “discriminatory nature had to be excluded, and the voidness was not expressed.”

The employee challenged the decision before the Supreme Court, complaining that the Court of Appeal – in stating that the reinstatement protection only applies to the cases of express voidness and not to all cases of voidness—wrongly interpreted Article 2, paragraph 1, of Legislative Decree no. 23/2015 both from the standpoint of breach of the enabling Law no. 183/2014 and because the emphasis of the adverb “expressly” would be unconstitutional and, in any case, illogical and inconsistent.

The Supreme Court, with referral order no. 9530 of 7 April 2023, ruled that the exclusion of voidness other than those expressed—consequent to the use in Article 2, paragraph 1, of Legislative Decree no. 23/2015 of the adverb “expressly”—was not reflected in Law no. 183/2014, which on the contrary, recognized reinstatement in case of null dismissals generically understood, without any distinction. In light of the above, the Supreme judges raised questions concerning the compliance with the Constitution of the said Article where it provides for reinstatement in the event of discriminatory dismissal or “in the other cases of voidance expressly provided for by law.”

With judgment no. 22/2024, the Constitutional Court stated that the distinction between “express nullities and nullities that are not expressed” is not based in the enabling Law no. 183/2014.

By expressing the above conclusions, the Court provided that, in the future, the regime of void dismissals will be the same both in the case where the mandatory provision breached also contains the express—and textual—sanction of voidness and in the case where voidness is not expressly envisaged as a sanction.

 

Decision no. 44/2024: small companies, Legislative Decree no. 23/2015 applies also to employees hired before its entry into force

This time, with decision no. 44 issued on 19 March 2024, the Constitutional Court found Legislative Decree no. 23/2015 in compliance with the Italian Constitution with reference to the extension of its discipline to all employees working in entities exceeding the threshold of fifteen employees after the date the Legislative Decree entered into force.

The Italian Constitutional Court on the legitimacy of Article 1, paragraph 3, Legislative Decree no. 23/2015 stated that it is in compliance with the Italian Constitution, also in the part where it allows the application of the unlawful dismissals regime for those hired after 7 March 2015 to all the employees working in companies that exceeded the dimensional limits referred to in article 18 Law no. 300/1970, as a result of hiring after that date.

In particular, the case before the Court of Lecce was about the challenge of a dismissal of an employee hired before 7 March 2015 who had invoked the application of the protections set out in article 18 Law no. 300/1970, as generally applied to those who were hired before that date in companies with more than fifteen employees. The company, for its part, insisted on the application of article 1, paragraph 3, Legislative Decree no. 23/2015, objecting that “although at the time of dismissal the requirements of the art. 18 […] were met, the numerical threshold had been exceeded after the entry into force of the aforementioned Legislative Decree no. 23 of 2015.” The Court of Lecce had doubted the constitutional legitimacy of this provision due to excessive delegation, with reference to the criteria set out in Law no. 183/2014 enacting the related decree, which “by delegating to the Government the provision of permanent contracts with increasing protections, limits its application to «new hires».

The Constitutional Court, valorising the “overall aim” pursued by the  legislator in 2014 of strengthening opportunities for entering into the labour market, instead concluded that it was allowed to the delegated legislator, “in the exercise of its power to complete the framework of the discipline,” to “regulate the position of employees in small companies, for whom there was no reinstatement protection regime pursuant to article 18 to be preserved.” More precisely, the Court states that for small companies, being able to apply the provisions of Legislative Decree no. 23/2015 to the entire workforce after exceeding the threshold of fifteen employees, regardless of each date of hiring, represents “an incentive (or the absence of obstacles) to grow in the company dimension.

In any case, taking into account the “balance desired by the delegating legislator,” the Italian Judge of Laws does not find any “regression in peius” in the protections provided by Legislative Decree no. 23/2015 for those employees already in force on 7 March 2015, to whom, before exceeding the size limit, the less favourable regulations of Law no. 604/1966 applied.

 

Decisions no. 128/2024 and 129/2024: questions on Article 3, paragraph 2, of Legislative Decree no. 23/2015

With ruling no. 128 of 16 July 2024, the Constitutional Court declared unconstitutional Article 3, paragraph 2, of Legislative Decree no. 23/2015, insofar as it did not provide for the application of reinstatement protection in cases of dismissal for justified objective reason, where the factual basis alleged by the employer was directly proven to be non-existent in court.

In particular, the Court clarified that the provision requires that, although the business reason underlying the dismissal for justified objective reason is not subject to judicial review on its merits, the factual element alleged by the employer must at least be “existent.”

Therefore, according to the Court, it is precisely “the radical irrelevance […] of the non-existence of the material fact in case of dismissal for justified objective reason”—unlike  in the parallel case of dismissal for just cause or justified subjective reason—that leads to “a lack of systematic coherence.” This is because the fact, whether challenged as “an alleged breach of conduct that did not actually occur” or presented “as a business reason that does not actually exist,” is equally non-existent in both cases.

Finally, the Court ruled that there can be no “justification for a differentiated rule” between economic and disciplinary dismissals when the absence of the fact (objective or subjective) is proven. In such a case, “an equal sanctioning treatment” must correspond to “the same seriousness of the defect.

This led to the declaration of unconstitutionality of Article 3, paragraph 2, of Legislative Decree no. 23/2015, which unjustifiably differentiated “identical or at least similar situations.

Still with reference to Article 3, paragraph 2, of Legislative Decree no. 23/2015, the Constitutional Court, in its judgment no. 129 of 16 July 2024, stated that it must be read in the sense of assimilating the hypothesis of the absence of a material fact to that in which the fact is punished by collective bargaining with a conservative sanction.

In such cases, indeed, the Court clarified that “the alleged fact is substantially unsuitable, by express agreement, to justify the dismissal,” which, if served, “turns out to be in breach of the statute of the collective agreements’ provisions,” with the consequent applicability of the reinstatement.

 

The full article is available on L&E Global website: https://leglobal.law/countries/italy/looking-ahead-2025-italy/