SOFIA GUALANDI

Dottoranda in Diritto dell’Unione Europa e ordinamenti nazionali
Università degli Studi di Ferrara

Table of contents: 1. Introduction; 2. National traditions and recent developments about dismissals: a comparative overview by the Labour Law Community; 3. Comparative dismissals law in action: young researchers in the spotlight; 3.1. Grounds for dismissal; 3.2. Procedural aspects of dismissal; 3.3. Remedies in case of unjustified dismissal; 3.4. Alternatives to dismissal; 4. Conclusions – for the time being.

 

 

• Introduction

The LLC Early Career Seminars on Comparative Labour Law (ECOLL) are scientific events dedicated to labour law early career researchers organised by the Labour Law Community since 2022. ECOLL aim at stimulating the dialogue between PhD students and other early career scholars and more established researchers, as well as to foster the links between universities and research centres belonging to different legal cultures. The seminars’ core is promoting comparative labour law.

The 2nd edition of the ECOLL Seminars took place in Salina, one of the Aeolian Islands (Italy), from 6th to 9th October 2024. The Island of Salina welcomed a dozen of experienced scholars and about twenty young researchers from different European countries for an intense discussion around the topic of “Unjustified dismissal and judicial compensation: which role for the judge?”. 

Unjustified dismissals are considered a traditional or even old-fashioned topic of national labour law. The same applies to the 1st edition of ECOLL (May 2022), whose topic was “The Status of Worker and Labour Law – Beyond Subordination?”. The reason for the choice of such subjects for ECOLL so far can be found in the assessment that, considering that academic career forces labour law researchers to get hyper-specialised on specific topics, it is necessary to organise opportunities for reflection on institutional and large issues, which belong to a timeless value system shared by this scientific community. It is indeed key to rediscuss these issues by changing perspectives and questions – which is only possible by involving the younger generations from different countries.

The brilliant choice of the topic, as well as the event planning, is owing to the Organising Committee composed by Tatiana Sachs (Paris Nanterre University), Luca Ratti (Luxembourg University), Cinzia Carta (Genova University), Elena Gramano (Milan Bocconi University), Stefano Bini (Cordoba University), Chiara Garbuio (Venice University), and Vincenzo Pietrogiovanni (SDU Odense). The success of the event, the convivial atmosphere and the pleasantness of the stay were possible thanks to the precious work of the Local Organising Committee of the University of Catania, led by Mariagrazia Militello and Antonio Lo Faro.

The programme was divided into three parts. Established scholars were asked to provide young participants with essential readings before the seminars and were called to animate the first part of the event, which indeed took the form of a conference. LLC members animated the second part of the seminars, which took the form of group-work, facilitated by tutors. The third part consisted in the final restitution of group-work results.

 

 

• National traditions and recent developments about dismissals: a comparative overview by the Labour Law Community

The conference was officially kicked-off by Prof. Marzia Barbera (Brescia University), LLC President, who congratulated on the progressive construction of a vibrant international research community. Barbera offered a precious methodological introduction around the subject of comparative labour law, underlining opportunities and risks of this tool. The continuous massive borrowing of rules is a widely used practice, which the labour researchers must monitor. As labour lawyers, this community was educated with a non-rigidly formalistic method. The teaching of Tullio Ascarelli was quoted – well-known scholar in comparative law, who left a lasting mark on Italian legal culture, embodying one of the most elegant expressions of the ‘revolt against formalism’. Ascarelli investigated the dialectic between the certainty of positive law and the need to develop it through the juridical interpretation. Interpretation, like comparison, cannot disregard the consideration of the historical, political and social context in which they are conducted. This is what makes them as difficult as they are necessary, if one does not want to misuse the instrument of comparative law.

The practice of comparison and transplantation in domestic legal systems, however, suffers from some shortcomings that deserved to be underlined, according to Barbera. First, attention to social processes is often missing, blindly relying on political choices to borrow models that are apparently effective elsewhere. The complex relationship between law and society needs to be put forward: if no rule can exist without meaning, the meaning belongs to its historical, societal, cultural and religious origin. Secondly, a strong eurocentrism and unawareness about the decolonization process was remarked. In practice, legal mutations are practiced only between Western countries, and only Western models are exported. The need for greater pluralism in this sense strongly emerged. 

The reasons for making comparative law are many, and the purpose of these seminars is to help refine and practice it in the sphere of labour law. When legal transplant does occur, critical cross-fertilisation and hybridization of rules is realised. When legal transfer occurs, on the other hand, a mimetic exercise that results from a mutual learning process is realized. Barbera’s hope is that these seminars will serve to critically observe these processes and to formulate new questions and perspectives.

This introduction was followed by Prof. Tatiana Sachs’s key-note speech, discussing the legal regime of dismissals in France. The paper covered a number of systemic issues not only typical of the French system, but useful as well from a comparative perspective. Sachs put the dismissal law at the heart of labour law, and at the heart of dismissal law -she stated- is the role of the judge. According to some economists’, the legal uncertainty created by judicial intervention produced negative economic and effects. On this basis, while being constructed by giving the judge a central role, dismissal law was later reformed in several countries, especially during periods of economic crisis, by decreasing judicial powers and discretionality. Various techniques for weakening the judiciary were illustrated by Sachs, showing the negative impact of this processes on the system of protection against unjustified dismissal – affecting sometimes the DNA of the labour law system. Among these techniques, the following were quoted: restriction of the court access; limit of judicial review of the dismissal justification (e.g. rupture conventionelle); objectivation des motifs économiques de licenciement (legification of accounting indicators to quantify the economic difficulty of the company, with respect to the verification of which the judge is deprived of discretion); reducing power of the judge in quantifying the compensation for unfair dismissal (e.g. c.d. Barem Macron, which is an example of legal transplant) to allow the employer to know in advance the “cost” of an unfair dismissal (i.e. application of the theory of efficient breach of contract to employment relations).   Sachs concluded with an interpretation of these evolutions, arguing that labour law – as reformed according to flexicurity theories toward labour market law, i.e. in favour of making the labour market working more smoothly – abandoned its protective functions of subjective rights that employee can claim vis-à-vis the employer. The first dramatic consequence is a break with the rationale of making employers responsible for employment, while the second one is the reduction of the role of dismissal law as the cornerstone of labour law. However, in France as in other countries, dismissal law still retains this pivotal role and full force in terms of defending employees’ fundamental rights and freedoms, included equality and anti-discrimination rights.

Subsequently, the interventions of national academics took place, illustrating the evolution of the role of the judge in the regulation of dismissals in their respective legal systems. These aimed at providing essential tools for comparison at the service of the group-works that would have follow. 

Prof. Valerio Speziale (Chieti-Pescara University) intervened to describe the evolution of the sanctioning system of unjustified dismissal in Italy and the role of the judge. While in Italy there is a little use of private arbitration, the judiciary role is traditionally essential and wide, as the legislation on dismission was built on open clauses and general definitions, that need to be interpreted case-by-case, also thanks to the support of collective bargaining agreements (CBAs) that contain list of cases and exemplification for dismissal. The reforms of the system, which took place in 2012 (Fornero Reform) and 2015 (Jobs Act), went in the direction of reducing judge discretionarily, with the effect of reducing worker protection. Reforms strongly restricted the restatement rule (making it an exception), widely enlarging the compensation one and allowing the employer to quantify ex ante the cost of the unlawful dismissal, i.e. admitting that the employer can assess whether to comply with the contract or pay to break it – in violation of the Italian tradition of the so called “norma inderogabile” (mandatory rule). These reforms are the result of the influence of the Law & Economics doctrine. However, the jurisprudence of the Constitutional Court has played a fundamental role, through eleven judgments that have manipulated the legislation by practically dismantling the reforms. A part of the Italian doctrine criticised these rulings, seen as an invasion of political prerogatives. According to Speziale and a large part of the doctrine, however, the political discretion must consider “systemic legal constraints” related to the Constitution and the European Charters of Fundamental Rights, which have not been respected by the 2012 and 2015 reforms. The result is a patchwork of regulations waiting to be rationalised.

The intervention of Prof. Rüdiger Krause (Göttingen University) brought clarity around the German law for dismissal – the “nerve centre of employment law” (P. Schwerdtner). In Germany, a communitarian understanding of the enterprise is predominant (unitary principle). This means, phrased in the framework of the dismissals law, that socially unjustified dismissal is not valid. Protection Against Unfair Dismissal Act of 1951 defined three grounds for dismissals, i.e. cases of socially unjustified dismissal. The procedural peculiarity of the German system lies in the fact that individual dismissal holds a collective dimension, as without prior information of the works council – if present – it is not valid. Later, individual rights of the employee to sue the employer is exercised, if the dismissal is not justified. Judges holds a strong interpretative role, even if liberal reforms limited the scope of the Protection Act and reduced the intensity of the judicial review. Eventually, labour market policy consideration described for the French case proved to be applicable to the German case as well.

The Danish case was described by Prof. Mette Søsted Hemme (Aarhus University). It is well known that the Danish labour market and working conditions are primarily set by CBAs. Regarding dismissal protection, the September Agreement (1899) considered dismissal as part of the managerial prerogatives. In the sixties, the Main Agreement forbid the “arbitrary” dismissal and set main rules for settling complaints over unfair dismissals. In case of unfair dismissal, protection and enforcement mechanisms are governed by trade unions via alternative dispute resolution mechanisms designed in CBAs. This applies only to unionised workers covered by CBAs. In case of lack of coverage or failure to take charge by the trade unions, the role of the judge emerges. Considering that no general regulation for all employees is in force in Denmark on the area of unfair dismissals, the labour courts developed the precise ‘balancing act’ between employer and employee interests, via a longstanding consistent case law very ensuring foreseeability. This also connects to the dominant labour market policy of flexicurity model, where flexible legal market and predictability of the cost of dismissal is offset by strong active legal market and social security policies. Søsted Hemme confirmed that no discussions about reforms is currently in place, as the system is legitimised by social partners.

Eventually, Prof. David Mangan (Maynooth University) introduced the Irish unjustified dismissal protection model, representative of a common law jurisdiction where a liberal understanding of enterprise is dominant. Dismissal law in common law is meant to optimise conditions for business to operate, and labour law in general is considered as a facilitator for labour market and the economic development of the country. In Ireland, originally, employers were entitled to dismiss employees for any (or no) reason, as long as there were no constitutional issues involved, and the required notice was given (“wrongful dismissal” regime). Dissatisfaction with this regime emerged, and legislative intervention followed in 1977, introducing the unfair dismissal regulation. A dismissal is fair if it arises entirely or mainly from one of the following reasons: capability, competence and qualifications, misconduct, redundancy, statutory requirement, and “other substantial grounds” (open clause). Here, the reasonableness of the employer’s choice is measured. Regarding remedies, compensation is largely applied. As exceptions, re-instatement (to the position held immediately before dismissal) and re-engagement (either in the same job or in a suitable different job, but no entitlement to recover pay for the period between dismissal and reengagement) are available.

 

 

• Comparative dismissals law in action: young researchers in the spotlight

The conference was followed by group-works around specific topics assigned to the young researchers. The assignment of the topics to the four groups reflected the most relevant components of the discipline of dismissal: the right not to be unfairly dismissed and the grounds for dismissals (§3.1); the procedural aspects of dismissals (§3.2); the remedies in case of unjustified dismissals (§3.3); the alternatives to dismissal (§3.4).

Each group, composed by young researchers from different countries, was to carry out joint research under the supervision of a senior tutor, focusing on drivers of similarities and differences of the legal disciplines of their home countries and others deemed relevant to the assigned topic, and was to present their findings and reflections in a plenary session the following day – for the benefit of the general discussion. The results of the work groups are synthetised below. 

Group work was overseen by members of LLC, including Prof. Fausta Guarriello (Chieti-Pescara University), Prof. Bruno Caruso (Catania University), Prof. Carla Spinelli (Bari University), Prof. Mariapaola Aimo (Turin University), Prof. Maurizio Falsone (Ca’ Foscari Venice University), and Prof. Veronica Papa (Catania University).

Methodological suggestions were shared, such as the attention to the role of European and international standards, the role of fundamental rights as such, the role of Constitutions and constitutional courts, the role of the labour market law in the recent reforms, the role of the reinstatement versus compensation remedy, the differences between collective and individual dismissals, the seize of the employers, the qualifying periods, the role of general clauses, and – last but not least the risk of false friends when dealing with comparative labour law.

 

 

• Grounds for dismissals 

The first group, composed by Elena Castro Suris (Vigo University), Antonin Schultz (Paris Nanterre University), Marco Guerini (Catania University), Sofia Gualandi (Ferrara University), and Nastazja Potocka (Luxembourg University), and facilitated by Prof. Vincenzo Pietrogiovanni, approached the topic of grounds for dismissals under a comparative lens, applying an historical approach to sources. Protection against unjustified dismissals experienced a regulatory evolution, the reasons for which are to be found in the historical, political and cultural context of the countries analysed (Germany, Italy, France, Spain, UK, Poland). While in the liberal era dismissal was governed by civil codes, and specific grounds for dismissal were not detailed as the balance between contractual parties was trusted, the introduction of the Constitutions – directly or indirectly – provided for protection against arbitrary dismissal, based on the conscience of imbalance of power between employer and employee. Grounds were later defined by national public statutory laws (exception: Denmark) and often detailed by CBAs and case law. While Germany introduced a tripartite taxonomy of grounds for dismissal in 1951, other countries introduced bipartite taxonomies later in the ’60-’70. Looking at international sources, the ILO Conv. 158 (1981) inherited the German tripartite taxonomy, while the European Charter of Fundamental Rights did not specified grounds for unjustified dismissal. It was also remarked that recent flexicurity reforms did not impact the discipline of grounds for dismissal. 

The group explored the cultural and historical origins of grounds for dismissals, which helped explaining the differences among countries. Indeed, systems differ in the way that they understand the nature of the employment relationship and, consequently, in the role that “trust and confidence” plays. It was possible to identify two models. On the one hand, in the German model, where business is considered as a community, loss of trust and confidence is measured in an “objective” way by the judge, taking into consideration the seniority of the employee and, thus, the years of cooperation between the employer and employee. Through case law, France also introduced an objective standard of proof for the employer to comply, to be able to claim a loss of confidence and trust (trouble objectif). On the other hand, Italian and UK “subjective” models should be mentioned. In both jurisdictions there is public protection to formally preserve the balance of powers within the employment relationship. Nevertheless, it is possible to acknowledge general clauses allowing the employer to claim a loss of trust and confidence. In Italy, this might be due to the permanence that the concept of pater familas of roman law origin still plays in the system. In UK, this may be attributed to the common law origins, the importance of tradition and the model of double sovereignty and the presence of the open clause “other substantial reasons” that must be interpreted according to the “band of reasonable responses” test.

In conclusion, young researchers wondered if nowadays there is a truly fundamental right not to be unfairly dismissed, frankly opting for a negative answer, when looking at the subjective scope of application of such right. Indeed, national legislations excluded some target groups from dismissal protection, e.g., domestic workers, professional sport workers, managers, employees subjected to a probationary period, or employees entitled for retirement. The group did not take sufficiently into account the role of the judges, leaving room for further research on this issue. 

 

 

1. Procedural aspects of dismissal

Arianna Abbasciano (Bari University), Agostino Fernicola (Catania University), Johanna Obermayer (Wien University), Alex Sans Dalmau (Barcelona Pompeu Fabra University), facilitated by Prof. Cinzia Carta, focused on the procedural aspects directly or indirectly involving workers’ representatives in individual dismissal procedures at company level. The comparison was limited to Italy, Spain, Germany and Austria. In these countries, a strongly different involvement of workers’ representatives was reported, and linked to the different industrial relations’ traditions and practices. While Italy was described as a “single channel” model of workers representation at the establishment level, characterised by the presence of the union structures both inside (RSA/RSU) and outside the workplace, Spain, Germany and Austria are examples of a “dual channel” one, characterised by the presence of both trade unions and independent work councils at company level. Cross-referencing the analysis of the company-level industrial relation system and the dismissal procedures, young researchers tried to demonstrate that the more these are somehow institutionalised, the greater is the involvement of workers’ representatives in individual dismissal procedures, and the less is the role of the judge in questioning the social justification for dismissal. 

This proves to be evident when looking at the two opposite models. On the one hand, the Italian system foresees almost no involvement of the workers’ representatives in individual dismissals procedures, except in specific cases where the workers ask for legal assistance, or where a preliminary conciliation procedure is mandatory. On the other hand, in Austria and Germany there is a key involvement of the works council already prior to the dismissal: here, if the employer does not comply with the union information requirement, the dismissal is null and void. The second part of the analysis regarded how procedures prior to the dismissal affect later court proceedings. 

While this point deserves further research, the group expressed the hypothesis that in the systems where workers’ representative bodies must be informed in advance, the role of the judge is limited at the later stages. Indeed, while Italian judges keep freedom in reviewing dismissals, in Austria social justification is perceived as a collective matter, which means that if the works council priorly agrees with the dismissal, it cannot be challenged afterwards due to being unjust on social grounds. This is, however, untrue in Germany, where the employee is not legally prevented to challenge it due to social grounds in the courts.

 

 

• Remedies in case of unjustified dismissals

The third group was composed by Merve Kutlu Mutluer (Anadolu University), Silvia Zinolli (Pisa University), Alessandro Murru (Cattolica University), Theo Dagan (Paris Nanterre University) and Iris Zhang (Manchester University). Young researchers, supported by Prof. Luca Ratti, analysed the consequences of unjustified dismissal in several countries, namely France, Italy, UK and Turkey. A common trend around remedies was clearly remarked, i.e. a movement from systems where reinstatement or compensation were both possible, toward systems where compensation plays a key role and is more widespread, limiting both the cases for reinstatement and the discretion of the judge in quantifying the amount of the compensation, which is mainly pre-calculated by law on the parameter of seniority. Indeed, the foreseeability of the compensation’s thresholds was developed at the service of the employers, finally able to measure the cost of individuals dismissal in advance – in the name of the flexicurity. 

This trend is counterbalanced by legal and judicial “resistances”, turning around fundamental rights or anti-discriminatory law, according to the group of young researchers. Legal resistance means, in specific cases such as discriminatory dismissal, dismissal of a protected employee, or dismissal during a legally protected period, that these are null and void, and reinstatement is envisaged as primary remedy in the legal systems analysed. Resistance to the trend toward compensation has been expressed by judges as well, for example invoking the application of International Conventions against the inadequacy of the c.d. Barème Macron system in France or dismantling the reform of Article 18 of the Workers Statute in Italy by means of Constitutional Court rulings. Indeed, national High Courts delivered different rulings when judging the direct effect in domestic law, in a dispute between individuals, of the Article 24 of the European Social Charter.

A peculiar conclusion was delivered while discussing the role of labour law in protecting workers’ rights and market functioning: the compensation-based remedial model should not be considered as a problem in itself, but in its co-existence with social security systems not inspired by consistent principles. Compensation model, inspired from flexicurity, is socially acceptable only when combined with effective labour active policies, strong public benefits and a well-structured welfare state – i.e. in systems where it is no longer necessary to protect the employment, because the State takes care of the person temporarily leaving the labour market. Beyond flexicurity, the group imagined a new model inspired to the “sustainability” of the enterprise, according to which the responsibility for the worker’s well-being is shifted from the State to the employer – a model indeed non-coherent with a remedial system based on mere compensation for dismissal. The debate around the results of this working group has shown the topicality of the issue of remedies against unjustified dismissal – even object of a referendum in Italy that will call citizens to vote in spring 2025.

 

 

• Alternatives to dismissal

Carlo Valenti (Siena University), Michela Pinna (Cagliari University), Estelle Lilliu (Paris Nanterre University), Guotong Shen (Maastricht University) were tutored by Prof. Elena Gramano in exploring the subject of alternatives to dismissals, that the group defined as “any operation or even strategy or institute that leads to the same effect, namely the termination of the employment relationship”. Two legal rationales behind such cases were pinpointed by the group. On the one hand, the legislators’ traditional goal has been to guarantee that alternative ways of terminating the employment relationship were protective for the employee, genuine and not misused by the employer to circumvent the application of dismissal law. Examples of such special protection can be found in situations of major changes of the employer (e.g., transfer of undertaking, relocating) or major changes of the individual employee (e.g., quitting due to difficulty in conciliation with maternity, access to unemployment, etc.). On the other hand, in the framework of recent neo-liberal reforms occurred in several countries, the lawmakers decided to support the employers’ interest to avoid the dismissal costs and risks of being taken to court. 

Examples of this latter trend are tools such as mutual termination of employment with monetary compensation, in force in France, Italy, and Spain, implying an ex-ante control of the fairness of the agreement. Such possibility was introduced in these countries via reforms that overall lower the level of protection for employees. It’s remarkable that in national systems where the involvement of workers’ representatives in the individual dismissal procedures is strong, such mutual terminations do not exist. Indeed, the difference between the communitarian concept of the enterprise (Denmark, Germany) and the liberal one (Italy, France) is behind these different regulations. Regarding the role of the judge, excluding cases of forced resignation, this is severely limited or even completely excluded. The conclusions of the group underlined that those recent legislative reforms moved in the direction of limiting the judge’ intervention outside the usual space for verifying the lawfulness of the dismissal – wondering if a balancing exercise is preserved or if the new rules disproportionately favour the employer.  

 

 

• Conclusions – for the time being

ECOLL 2024 Seminar concluded with the awareness of having taken another step in building a community of scientific and political reflections, but also of connection and friendship. A community turning around love for research, study, discussion, and for each other. The event proved to be unique in the Italian training landscape for young labour lawyers and researchers, who to make use of comparative law not only as a tool of knowledge and research, but also as an instrument of political resistance and social change. 

The negative consequences of the abuse of comparative labour law implicitly emerged in many of the lectures of ECOLL 2024, both during the conference and group work. Pure legal transplantation, from one national legal system to another, has sometimes been used to make politically acceptable choices at the expense of worker protection. Indeed, only a comparative exercise that respects legal, political and cultural traditions, power relations between social forces and stakeholders, and historical developments of legal systems can be acceptable in the field of labour law. At the same time, researchers and legislators who make use of comparative law must clarify in advance the questions they seek to answer and the problems they intend to solve in the area of labour law, carefully taking into account the specificities and differences between the labour and social security systems in the broad sense, in order to avoid watering down political choices and responsibilities under the guise of technique.

The next edition of the ECOLL Seminar is therefore eagerly awaited to continue and expand this journey together.