JUDGMENT NO. 7

YEAR 2024

ITALIAN REPUBLIC

IN THE NAME OF THE ITALIAN PEOPLE

THE CONSTITUTIONAL COURT

composed of:

President: Augusto Antonio BARBERA;

Justices: Franco MODUGNO, Giulio PROSPERETTI, Giovanni AMOROSO, Francesco VIGANÒ, Luca ANTONINI, Stefano PETITTI, Angelo BUSCEMA, Emanuela NAVARRETTA, Maria Rosaria SAN GIORGIO, Marco D’ALBERTI, Giovanni PITRUZZELLA, Antonella SCIARRONE ALIBRANDI,

has issued the following

JUDGMENT

in the proceedings concerning the constitutional legitimacy of Article 10, considered as a whole, and in conjunction with Article 3, paragraph 1, of Legislative Decree No. 23 of 4 March 2015 (Provisions on contracts of employment with indefinite duration and with increasing protection, in implementation of Law No. 183 of 10 December 2014), in the text prior to the amendments made by Article 3, paragraph 1, of Decree Law No. 87 of 12 July 2018 (Urgent provisions for the dignity of workers and businesses), converted, with amendments, into Law No. 96 of 9 August 2018, initiated by the Court of Appeal of Naples, Labour Division, in the proceedings between C. R. and B. srl, by order of 16 April 2023, registered under No. 72 of the register of orders for 2023 and published in the Official Gazette of the Republic No. 22, first special series, of 2023.

Seen the act of constitution of C. R.;

Heard at the public hearing of 5 December 2023, Justice Rapporteur Giovanni Amoroso;

Heard Attorney Sergio Vacirca for C. R.;

Deliberated in the council chamber of 5 December 2023.

Facts of the Case

1.– By order of 16 April 2023 (reg. ord. No. 72 of 2023), the Court of Appeal of Naples, Labour Division, raised questions of constitutional legitimacy concerning Articles 3, paragraph 1, and 10 of Legislative Decree No. 23 of 4 March 2015 (Provisions on contracts of employment with indefinite duration and with increasing protection, in implementation of Law No. 183 of 10 December 2014), with reference to Articles 3, 4, 10, 24, 35, 38, 41, 111, 76 and 117, first paragraph, of the Constitution, the latter two in relation to Article 1, paragraph 7, letter c), of Law No. 183 of 10 December 2014 (Authorisations to the Government regarding the reform of social shock absorbers, employment services and active policies, as well as regarding the reorganisation of the regulation of employment relationships and inspection activities and the protection and reconciliation of care, life and work needs) and Article 24 of the European Social Charter, revised, with annex, made in Strasbourg on 3 May 1996, ratified and made enforceable by Law No. 30 of 9 February 1999 (hereinafter: ESC).

1.1.– The questions are raised in the course of proceedings for the appeal of a dismissal, served on 1 July 2016, to a female worker hired on 1 May 2016, following a collective dismissal procedure for "staff reduction" initiated pursuant to Articles 4 and 24, paragraph 1, of Law No. 223 of 23 July 1991 (Rules on redundancy payments, mobility, unemployment benefits, implementation of European Community directives, placement and other provisions on the labour market), criticised for violation of the procedure and for the incorrect application of the selection criteria.

1.2.– The referring Court states that it has already proposed, with reference to the same questions, a request for a preliminary ruling on which the Court of Justice of the European Union, by order of 4 June 2020, in case C-32/20, TJ v. B. srl, declared itself manifestly incompetent due to the extraneousness of the dispute in the main proceedings, relating to the consequences of the act of termination, to the obligations imposed by Council Directive 98/59/EC of 20 July 1998 on the approximation of the laws of the Member States relating to collective redundancies; as well as, in the same proceedings, questions of constitutional legitimacy, for profiles that are partly identical and partly related, declared inadmissible by this Court (Judgment No. 254 of 2020) due to insufficient identification of the defects in the collective dismissal and the uncertainty about the type of intervention requested.

1.3.– With regard to relevance, the judge a quo highlights that he has declared the illegitimacy of the challenged dismissal by partial judgment due to violation of the selection criteria, and that he has ordered the continuation of the proceedings for the sole purpose of identifying the sanctioning consequences; he, therefore, observes that the sanctioning regime provided for by Article 3, paragraph 1, of Legislative Decree No. 23 of 2015, referred to by Article 10 of the same decree, in the version prior to the amendment under Decree-Law No. 87 of 12 July 2018 (Urgent provisions for the dignity of workers and businesses), converted, with amendments, into Law No. 96 of 9 August 2018, applies to an unlawful collective dismissal due to violation of the selection criteria, served in 2016 on a worker hired after 7 March 2015, under which the judge declares the termination of the relationship and orders the employer to pay an indemnity not subject to social security contributions "in a measure of no less than four and no more than twenty-four months' wages".

1.4.– With regard to non-manifest lack of merit, the referring Court formulates three articulated criticisms.

1.4.1.– Firstly, the Court doubts the constitutional legitimacy of Article 10 of Legislative Decree No. 23 of 2015, both as a single provision and in conjunction with Article 3, paragraph 1, of the same decree, with reference to Articles 3, 10, 35, 76 and 117, first paragraph, of the Constitution, in the part in which it would have modified the sanctioning rules for the violation of the selection criteria of redundant workers in the context of a collective dismissal, even in the absence of a specific authorisation and, in any case, in contrast with Article 24 of the ESC, in violation of the principles and guidelines of the delegation law.

With reference to the internal profile, the modification of the sanctioning regime for collective redundancies would be an intervention exceeding the scope of the textual authorisation referred to in Article 1, paragraph 7, letter c), of Law No. 183 of 2014, which, by delegating the Government to adopt regulations that provide for increasing protections with seniority that exclude "for economic dismissals, the possibility of reinstating the worker", would not allow it to be considered as included in the devolution of regulatory power also the remodulation of the sanctioning rules of collective dismissals, as a unitary and complete regulatory body, independently regulated.

In the same sense, both the analysis of the parliamentary proceedings (Public and Private Labour Commission of the Chamber of Deputies, XI, sitting of 17 February 2015; Public and Private Labour, Social Security Commission of the Senate of the Republic, 11th, sitting of 11 February 2015) and the consideration that such a significant modification would have required an unequivocal and explicit lexical choice would support this.

As for the supranational profile, the delegated regulatory power would not have been exercised in accordance with international conventions, as required by Article 1, paragraph 7, of Law No. 183 of 2014, and in particular in relation to Article 24 of the ESC, the violation of which by Legislative Decree No. 23 of 2015 – in the part in which, providing as a sanction for an unlawful dismissal a lump-sum indemnity fixed ex ante in a rigid ceiling, it would not allow for a personalisation of the damage suffered due to the loss of the job – would already have been ascertained by the European Committee of Social Rights in the decision of 11 September 2019, published on 11 February 2020, accepting the collective complaint proposed by the Italian General Confederation of Labour (CGIL) No. 158 of 2017, followed by the resolution of the Committee of Ministers of the Council of Europe of 11 March 2020, which invited Italy to report on any measures adopted to bring the measure under examination into conformity with the Charter.

1.4.2.– Secondly, the judge a quo considers that the conflict of Article 3, paragraph 1, of Legislative Decree No. 23 of 2015, in conjunction with Article 10 of the same decree, with Articles 3, 4, 24, 35 and 111 of the Constitution, is not manifestly ungrounded, in the part in which, for the same violation of the selection criteria, in the same collective dismissal procedure and for homogeneous employment relationships, it would unreasonably order a sanction devoid of deterrent effect and unsuitable to ensure a personalised and effective compensation for the damage only for workers hired under permanent contracts after 7 March 2015.

The referring Court observes that, in the collective dismissal procedure on which it is called upon to adjudicate, there are employment relationships that, although subject to the same and simultaneous comparative analysis to be extended to the entire company complex, are characterised by non-homogeneous sanctioning regimes, in that an identical violation of the selection criteria is remedied with the reinstatement of the employment relationship and social security benefits for workers hired under permanent contracts up to 7 March 2015, and exclusively with a flat-rate indemnity, based on a notion of remuneration, which is not all-inclusive and inadequate to ensure effective compensation for the damage also from the social security point of view, for workers hired subsequently.

In the presence of an identical violation that determines the unlawful loss of the job, a differentiated treatment, which in an individual perspective may be considered justified due to the "passage of time", would instead give rise to an unreasonable disparity of protection within a collective procedure, becoming a disharmonious and penalising factor in the comparison, and even a condition, with respect to the need for impartiality that characterises the choice; the justifying reason for the "purpose" pursued by the legislator, "to strengthen the opportunities for entering the world of work for those seeking employment" (first paragraph of Article 1, paragraph 7, of Law No. 183 of 2014), would lose its meaning in a redundancy procedure, in which the identification of the workers to be dismissed must be based exclusively on a punctual application of homogeneous and objective selection criteria, since the radical weakening of the sanction would amplify for these workers the "risk" of losing their job, with an unreasonable sacrifice that extends also to the social security position.

In the comparative procedure referred to in Articles 4 and 24 of Law No. 223 of 1991 – the judge a quo concludes on this point – the combined effect of the challenged rules would unjustly penalise workers hired under permanent contracts after 7 March 2015, with the provision of a job guarantee regime that would conflict with the invoked constitutional parameters.

1.4.3. – With the third question, the judge a quo doubts the constitutional legitimacy of the challenged rules in conjunction, with reference to Articles 3, 4, 24, 35, 38, 41, 111 and 117 of the Constitution, where, unreasonably, in the presence of a violation of objective and solidarity-based selection parameters, they would derogate from an effective and adequate sanctioning system, determining, with the flat-rate damage system, a weakening of the compensation for the damage caused to such an extent that it would not guarantee an effective and efficient sanction in the event of a violation of the selection criteria.

The derogation introduced by Article 10 of Legislative Decree No. 23 of 2015 with the reference to Article 3, paragraph 1, of the same decree, with respect to the objective deterrent efficacy of the previously existing sanction for the same violation, would require the application of an indemnity system that is inadequate to compensate for the damage arising from the loss of the employment relationship, leading to a lack of responsibility on the part of private initiative with respect to the effects of an unlawful act and to the impossibility of personalising the damage suffered by the unlawfully dismissed worker and therefore their protection.

1.5.– The judge a quo dwells, finally, on the type of intervention requested and invokes in primis a declaratory judgment annulling the entire Article 10 of Legislative Decree No. 23 of 2015 or, at the very least, the phrase "or of the selection criteria referred to in Article 5, paragraph 1, of Law No. 223 of 1991", which would determine a re-expansion of the previous uniform regime for all workers involved.

Alternatively, should the criticisms of the aforementioned Article 10 be considered unfounded, it proposes the adoption of an interpretative ruling accepting the annulment of Article 3, paragraph 1, of Legislative Decree No. 23 of 2015, with regard to the phrase "and not more than twenty-four" (now thirty-six), aimed at eliminating the "ceiling" of the flat-rate indemnity measure, which would make the sanction ineffective as a deterrent, limited to the case of the illegitimacy of the collective dismissal for violation of the selection criteria referred to in Article 5, paragraph 3, of Law No. 223 of 1991.

2.– By an act filed on 15 June 2023, C. R., the applicant in the a quo proceedings, was constituted in the proceedings and has supported the relevance and merits of the raised questions of constitutional legitimacy, referring to the considerations formulated by the referring judge, and in particular to the criticisms of failure to comply with the limits to the regulatory delegation imposed by Article 1, paragraph 7, of Law No. 183 of 2014, of violation of the parameters by the diversified protection regimes, as well as of unreasonableness of the sanctioning system applicable in practice; in the party's opinion, the requested annulment intervention would be consistent with the indications and warnings that can be obtained from the jurisprudence of this Court, expressed in particular with Judgments No. 183 of 2022 and No. 194 of 2018, as well as with the wording of Article 24 ESC.

2.1.– In the vicinity of the hearing, the party has filed a memorandum in which, after having insisted on the criticisms of failure to comply with the devolved regulatory power, it has focused on the violation of the right to equality and the principle of reasonableness, highlighting that in the context of collective redundancies, the need to avoid discriminatory treatment among workers, which would result from differences in the law, would emerge as a priority that could mitigate, up to the point of nullifying, the need to give precedence to the neutrality of the passage of time with respect to the application of the law.

In light of these observations, the party hopes for the cancellation of the phrase contained in Article 10 of Legislative Decree No. 23 of 2015 ("or of the selection criteria referred to in Article 5, paragraph 1, of Law No. 223 of 1991") and the reinstatement of the sanctioning mechanism introduced with the so-called "Fornero law" for all workers subject to a collective dismissal.

3.– The President of the Council of Ministers did not intervene in the proceedings.

4.– At the hearing of 5 December 2023, the party insisted on the acceptance of the conclusions set out in the written defences.

Legal Reasoning

1.– By order of 16 April 2023 (reg. ord. No. 72 of 2023), the Court of Appeal of Naples, Labour Division, raised questions of constitutional legitimacy concerning Articles 3, paragraph 1, and 10 of Legislative Decree No. 23 of 2015, with reference to Articles 3, 4, 10, 24, 35, 38, 41, 111, 76 and 117, first paragraph, of the Constitution, the latter two in relation to Article 1, paragraph 7, letter c), of Law No. 183 of 2014 and Article 24 of the ESC.

1.1.– The questions arose in the context of appeal proceedings concerning the challenge to a collective dismissal served on a female worker hired and dismissed after 7 March 2015, the date of entry into force of Legislative Decree No. 23 of 2015, considered unlawful for violation of the selection criteria referred to in Article 5, paragraph 1, of Law No. 223 of 1991.

In the opinion of the referring Court, the sanction provided for by Article 3, paragraph 1, of Legislative Decree No. 23 of 2015, referred to by Article 10 of the same decree, in the version prior to the amendments under Decree-Law No. 87 of 2018, as converted, would be manifestly non-homogeneous both with respect to the reinstatement that is applicable for the same type of invalidity of the termination to employment relationships established ante 7 March 2015, and with respect to that applicable to relationships established after 7 March 2015, but resolved after the amendment of 2018, which increased the indemnity, from a minimum of four to six and a maximum of twenty-four to thirty-six months' pay.

1.2.– With reference to Articles 3, 10, 35, 76 and 117, first paragraph, of the Constitution, the referring Court submits that Article 10 of Legislative Decree No. 23 of 2015, considered as a single provision, and in conjunction with Article 3, paragraph 1, of the same decree, in the part in which it has modified the sanctioning rules for the violation of the selection criteria of redundant workers in the context of a collective dismissal, would violate the authorisation law under two profiles, one internal and one supranational.

As for the first profile, because Article 1, paragraph 7, letter c), of Law No. 183 of 2014, by delegating the Government to adopt regulations that excluded the possibility of reinstating the worker in their job only "for economic dismissals", a term referable to individual terminations for objective reasons, did not allow for the inclusion in the delegated regulatory power also of the remodulation of the sanctioning rules of collective dismissals.

As for the second profile, because, in deviation from the principles and guidelines which in Article 1, paragraph 7, of Law No. 183 of 2014 required an exercise of the delegation consistent with international conventions, the challenged provision has come into conflict with Article 24 of the ESC by providing as a sanction an indemnity, set ex ante in a rigid ceiling, which does not allow for a personalisation of the damage suffered due to the loss of the job (a conflict already considered by the European Committee of Social Rights in the decision of 11 September 2019, published on 11 February 2020).

1.3.– With reference to Articles 3, 4, 24, 35 and 111 of the Constitution, the judge a quo criticises Article 3, paragraph 1, of Legislative Decree No. 23 of 2015, in conjunction with Article 10 of the same decree, in the part in which, for the violation of the selection criteria of redundant workers in the context of a collective dismissal, it introduces different sanctioning rules only for workers hired under permanent contracts after 7 March 2015, because it would unreasonably order, for an identical violation, that occurred simultaneously in the same procedure and for homogeneous employment relationships, a sanction devoid of deterrent effect and unsuitable to ensure a personalised and effective compensation for the damage suffered as a result of the unlawful loss of the job.

1.4.– With reference to Articles 3, 4, 24, 35, 38, 41, 111 and 117, first paragraph, of the Constitution, the latter in relation to Article 24 of the ESC, the referring Court puts forward the constitutional illegitimacy of Article 10 of Legislative Decree No. 23 of 2015, considered as a single provision, and in conjunction with Article 3, paragraph 1, of the same decree, in the part in which, with reference to the violation of the selection criteria of the redundant worker in a collective dismissal procedure, it derogates from an effective and adequate sanction, introducing, unreasonably, in the presence of a violation of objective and solidarity-based selection parameters, an ineffective flat-rate damage system. This determines a weakening of the compensation for the damage caused and does not allow for an adequate responsibility of the defaulting party through a personalisation of the damage caused.

2.– Preliminarily, the inadmissibility of the criticisms of constitutional illegitimacy raised with reference to Articles 10, 24 and 111 of the Constitution must be noted ex officio, as they are completely devoid of reasoning.

The referring Court has limited itself to invoking the aforementioned parameters without any specific and adequate illustration of the reasons for criticism on the issue of non-manifest lack of merit, nor does the order provide elements that allow an evaluation of the alleged conflict of the challenged provisions with such generically invoked parameters (on inadmissibility due to lack of reasoning on non-manifest lack of merit, ex plurimis, Judgments No. 194 of 2023, No. 118 of 2022, No. 213 and No. 178 of 2021, No. 126 of 2018).

3.– The order for referral does not present any further profiles of inadmissibility.

3.1.– With regard to relevance, the descriptive elements regarding the main proceedings and the personal situation of the applicant are sufficient to demonstrate the applicability ratione temporis of the challenged provisions (ex plurimis, Judgments No. 152 of 2021, No. 59 of 2021 and No. 218 of 2020). The referring Court has acknowledged that it has ascertained by partial judgment the violation of the selection criteria in the context of a collective dismissal procedure and, with this, justified the application of the indemnity sanctioning regime introduced by Legislative Decree No. 23 of 2015, given the reference of Article 10 by Article 3 of the same decree, thus overcoming the reasons for inadmissibility of similar questions raised by a previous order for referral from the same Court of Appeal (Judgment No. 254 of 2020). In general, in fact, the judge a quo is entitled to raise the same question a second time in the same proceedings when this Court has issued a non-decisive ruling, based on reasons removable by the referring Court (ex plurimis, Judgment No. 247 of 2022).

3.2.– With regard to the non-manifest lack of merit of the questions, the order for referral has sufficiently reasoned the doubts of constitutional legitimacy with arguments that have an overall consistency and unity.

All criticisms of constitutional illegitimacy are, in reality, focused on the sanctioning regime of unlawful collective dismissals for violation of the selection criteria, served on workers hired after the date of entry into force of Legislative Decree No. 23 of 2015 (7 March 2015), which has eliminated reinstatement as a consequence of the illegitimacy of this type of dismissal.

The elimination of reinstatement protection in the job – which, however, still remains for workers hired before that date, where recipients of the same unlawful collective dismissal – and the limitation of the consequences of the employer's termination to monetary compensation only, constitute the common feature of the criticisms made by the Court of Appeal, all aimed at reintroducing the reinstatement of the unlawfully dismissed worker also in the case subject to the main proceedings.

Having this unitary objective in mind, the Court of Appeal – as already mentioned – criticises, with reference to the indicated parameters, the elimination of reinstatement: a) because it was provided for by the delegated legislator without it being attributable to the law of delegation and therefore with excess of delegation under an internal profile (infra, points 6 to 11) and a supranational one (infra, points 12 to 14); b) because it determines an unjustifiably and unreasonably differentiated discipline, with reference to the same collective dismissal, between "young" workers (with seniority starting from 7 March 2015) and "older" ones (hired before the aforementioned date), the latter of whom, however, retain reinstatement in their job in the event of unlawful collective dismissal for violation of the selection criteria (infra, points 15 to 17); c) finally, because, in any case, the indemnity alone (with an amount not exceeding a maximum ceiling), without reinstatement, does not in itself constitute an adequate and sufficiently dissuasive sanction for unlawful dismissals (infra, points 18 to 19).

4.– With reference to this specific unitary nucleus of criticisms (id est: reinstatement protection versus indemnity protection), the regulatory framework of reference must be recalled – before passing on to the examination of the merits of the questions – in essential terms.

4.1.– It may be recalled, first of all, that the reinstatement of the unlawfully dismissed worker, a strongly innovative protection measure, was introduced – conditionally upon the occurrence of a minimum employment level of the employer – by Article 18 of the Workers' Statute (Law No. 300 of 20 May 1970, containing "Rules on the protection of the freedom and dignity of workers, trade union freedom and trade union activity in workplaces and rules on placement"). At the time, this measure constituted a completion of the regulations (Law No. 604 of 15 July 1966, containing "Rules on individual dismissals"), introduced a few years earlier, on unlawful individual dismissals because they were unjustified (without just cause or justified reason: Articles 1 and 3) or because they were discriminatory (Article 4); a law that, by express provision, did not apply to the "matter of collective dismissals for staff reduction" (Article 11, second paragraph).

The scope of application of reinstatement (the so-called real protection of the worker) was, subsequently, expanded both by case law, which predicted its "expansive force", and by a first legislative reform of Article 18 of the Workers' Statute (Article 1 of Law No. 108 of 11 May 1990, containing "Regulation of individual dismissals"), approved under the pressure of a request for an abrogative referendum, admitted by this Court (Judgment No. 65 of 1990).

Reinstatement has, then, had a further expansion, as to its area of application, because it was also provided for in the case of unlawful collective dismissal by Article 24 of Law No. 223 of 1991, in implementation of Council Directive 75/129/EEC of 17 February 1975 on the approximation of the laws of the Member States relating to collective redundancies.

Gradually, however, in more recent times, the applicable extent of reinstatement, which seemed an irrevocable achievement of protection against unlawful dismissals, has been called into question, and Article 18 of the Workers' Statute, which has become a divisive and controversial issue also in the debate between political and social forces, has attracted reform pressures in favour of greater flexibility in leaving the job, combined with active support policies, on the one hand, and resistances, especially in the trade union world, to preserve reinstatement protection, on the other.

4.2.– Thus we arrive at the turning point represented by Law No. 92 of 28 June 2012 (Provisions on the reform of the labour market in a growth perspective), adopted in the context of a comprehensive reform plan for labour matters.

Article 18 of the Workers' Statute is further amended and, above all, "fragmented" into multiple protection regimes against unlawful individual dismissal, overcoming what until then had been the uniqueness of reinstatement protection for individual and collective dismissals.

Beyond the specificities of the individual reinstatement and indemnity regimes, it should be noted that the underlying logic of this important reform is that not all unlawful dismissals are equal. Without prejudice to the traditional employment limit, the legislator of 2012 decided to reserve the protection of reinstatement for dismissals whose illegitimacy is the consequence of a violation, in the broad sense, that is "more serious", providing for an indemnity compensation for the others.

An unprecedented criterion of gradation and differentiation is therefore introduced, which radically modifies the previous logic of reinstatement as the sole consequence of unlawful dismissal in non-small employment realities.

There are unlawful dismissals that it has been considered to continue to sanction with the reinstatement of the worker in their job in terms substantially similar to those of the (single) reinstatement of the previous regime. There are others that also give rise to reinstatement, but with an overall attenuated protection. Then, in other cases, there are the indemnity regimes, i.e. hypotheses of only compensatory protection without reinstatement in the job.

The compromise matrix of the law, between the demands for new flexibility and the resistance to the reduction of real protection, is found in the demarcation of the perimeter of the different protection regimes (reinstatement and indemnity) according to a line traced in terms not entirely precise, giving rise to ordinary litigation, as well as criticisms of constitutional illegitimacy.

And this is especially true for "economic" individual dismissals, i.e. dismissals for justified objective reason. Reinstatement is reserved for dismissals whose illegitimacy is "more serious" and these are those in which the justified objective reason, alleged by the employer, is even "non-existent". However, it is then added that the non-existence must be "manifest" and, furthermore, a further space for assessment is provided for the judge because they "[m]ay also apply" – and not "also applies" – reinstatement.