LEGAL NEWS IN THE SPOTLIGHT | The Constitutional Court on compensation remedy for unfair dismissal in collective redundancies

On 22 January 2024, in its judgment No. 7/2024, the Constitutional Court declared ungrounded the questions of legitimacy concerning the sanctions regime applicable on collective dismissals in the event of violation of the selection criteria in accordance with Articles 3 and 10 of Legislative Decree No. 23 of 4 March 2015, implementing what is known as the Jobs Act. Such discipline provides  economic protection for workers hired after 7 March 2015, instead of the reintegration granted to workers already in force on the aforementioned date. In the cases under consideration, the decision to abandon reintegration protection for employees hired on or after 7 March 2015 was examined by the court under three aspects. Firstly, the excess of delegated power of Legislative Decree No. 23 of 2015. Secondly, the unjustified difference in the sanctioning treatment between those hired before and those hired from 7 March 2015 onwards, within the same collective dismissal and,  finally, the inadequacy and insufficiently deterrent effectiveness of mere monetary protection. After ruling out the excess of delegated powers under various profiles, the Constitutional Court declared that the provision of a different penalty for the same breach, depending on the date of the worker’s employment (before or after 7 March 2015), does not violate the principle of equality as it responds to the legislator’s discretionary power to modulate the consequences of unlawful dismissal differently, or to preserve the reinstatement protection only for those workers in service in March 2015 who were already benefiting from it (old workers) and to limit the application of the new compensation rules to those hired after that date (young workers), with the aim of encouraging their employment. The Court, moreover, assessed the adequacy and dissuasiveness of the compensation remedy (currently set at a minimum of 6 months and a maximum of 36 months of the last salary), considering it suitable to balance the various interests at stake and to guarantee the right to work. Lastly, the Constitutional Court reiterated an “admonition” to the legislator to carry out a comprehensive review of the current sanctioning system for dismissals, given the complex situation due to the stratification of differentiated disciplines in a matter of such significant social impact.

Newsletter n. 93 – February 2024