Despite the growing impact of EU law on employment rights, the harmonisation of employment law across the union is still a long way off. Michele Bignami of Italian law firm Calabi, Bignami & Mainardi highlights the key employment law issues in Italy
Italy has a heavily codified system, which has been entrenched for many decades. This is in contrast to the typically leaner common law systems such as the UK, where employment rights have developed through a more flexible combination of legislation and binding court decisions. In the global market, flexibility is key; the legal systems of those countries without that flexibility are audibly creaking under the strain of modern business needs.
The current Italian labour system is based on a considerable number of Acts, some of which date back to the early 20th century. This has left a legacy of an awkward patchwork of old, new and often conflicting rules that make up the system.
As a consequence it was left to the Italian labour courts to try to rationalise the system and to adapt ageing legal provisions to the ever-changing labour market. This has proved difficult as Italian courts are not obliged to follow the earlier decisions of other courts. This is because the Italian system is based mainly on codes and Acts, not case law precedent.
As a result each court - and in each court, each judge - can build its own case law. Even today the chances of winning a case, particularly borderline cases, in the Italian labour courts often directly depend on the identity of the judge in charge of the case.
System lacking in flexibility
The second, and perhaps most important, factor an HR manager needs to appreciate in approaching the Italian system is that most of the provisions contained in the Labour Acts or the Collective Bargaining Agreements - the "CBAs" - are mandatory and cannot be amended or interpreted in favour of the employer. This leaves little room for flexibility.
The recruitment process
It is a fundamental principle of the Italian constitution that there must be no discrimination in recruitment. In particular, a prospective employer may not select or reject candidates on the basis of their sex, political or religious persuasion or racial origins. Also, the inclusion of a condition which automatically terminates the employment following marriage or pregnancy of the employee is null and void and is subject to certain penalties.