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Consult: unlawful dismissals, personalized compensation

The Constitutional Court has rejected the provision of the Jobs Act and the Dignity Decree which provided for a fixed calculation mechanism to determine the compensation in favor of the dismissed workers - The judges will be able to decide freely, also evaluating criteria other than length of service - What will be the impact on the labor market?

Consult: unlawful dismissals, personalized compensation

In the event of unlawful dismissal, judges must be able to decide from time to time what compensation the worker is entitled to. Limitations on their discretion are not admissible. The Constitutional Court filed the reasons for the sentence with which it rejected one of the more controversial provisions of the Jobs Act, taken up in the Dignity Decree: that which, in the event of unjustified interruption of a contract with increasing protection by the company, provided for a fixed calculation mechanism to determine the compensation in favor of the injured worker.

Attention: the Consulta has not expressed itself on the abolition of article 18 of the Workers' Statute - which remains a memory, together with the possibility of reinstatement in the event of dismissals for disciplinary or economic reasons later recognized as illegitimate - but only on a particular point of the new legislation. The one that imposed a rigid rule on the magistrates to quantify the compensation, i.e. two months' final salary for each year of service of the dismissed worker, with a minimum of four and a maximum of 24 months (limits later raised to 6 and 36 months by the Dignity decree of last July).

In compliance with the minimum and maximum limits established by law, according to the Constitutional Court, the judge must freely determine the amount, taking into consideration aspects such as the number of company employees, the size of the economic activity and the behavior of the parties. Length of service – it is reasoned – cannot be the only criterion, otherwise there is the risk of putting different situations on the same level for no reason, thus violating the principle of equality enshrined in Article 3 of the Constitution.

Not only. The Consulta also identifies a second profile of unconstitutionality, believing that predetermining a low minimum indemnity for workers with little seniority in the company conflicts with the principle of reasonableness, since an indemnity calculated in this way would not be sufficient to compensate the damage. Moreover, from the point of view of the employer, the prospect of having to pay a small compensation does not work as a deterrent, in the sense that it is not enough to dissuade those who intend to dismiss their employees without just cause.

The Court's decision, as always, is retroactive, and will therefore have a significant impact because all the judgments not yet concluded will have to comply with the new rule. It is not certain that equality will increase, because in theory the discretion granted to judges could lead to different compensations in very similar situations. Also, the decision

As for the effects on the labor market, the question is controversial. Some believe that this novelty - together with the regulatory tightening imposed by the Dignity decree - risks causing an increase in fixed-term contracts or even having a negative impact on employment. Others, on the other hand, argue that the Council's intervention is appropriate, because it is difficult to talk about a contract stable if the company can fix it at low cost without just cause. But precisely the quantification of costs now becomes more discretionary and this does not necessarily go in favor of the employee in every case.

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