Labor disputes and the jurisdictional immunity of foreign states and entities: the Supreme Court of Cassation addresses the question of the extent of immunity.

The Supreme Court of Cassation has ruled out the jurisdiction of Italian judicial authorities in connection with an appeal filed by an employee of a foreign diplomatic mission in Italy. It is well known that Italian legislation and jurisprudence since the 1960s have offered broad and enhanced protection of the employee. Not surprisingly, several quarters have recently seen a supposed need to reform regulations that give employees particularly strong protection in the event of dismissal, but which at the same time make the labor market extremely rigid. Moreover, current legislation limits an employer’s options for dismissing an employee or changing his or her duties during the course of the relationship. Under current regulations, the employer cannot dismiss the employee except for “just cause” or “justified reason.” An employee who is dismissed without just cause or justified reason may challenge the dismissal by filing a lawsuit against his or her employer, alleging the unlawfulness of the dismissal, in order to be reinstated in his or her job and/or to obtain compensation for damages suffered as a result of the dismissal. In such a case, the employer bears the burden of proving that the dismissal was supported by a “just cause” or “justified reason.” If, as is often the case, the court rules in favor of the employee, the employer, if it has fewer than 15 employees on the job, can avoid having to rehire the employee by paying in lieu of rehiring, an amount not less than the equivalent of six months’ salary (and sometimes much more, depending on the employee’s seniority) in damages. However, employers with more than 15 employees on the job do not have the option of choosing to pay damages instead of rehiring the worker and, therefore, may be forced to reinstate the worker to the job and pay all of the monthly wages that the worker would have received had he or she worked during the period between dismissal and reinstatement. There are those who argue that the current legislative framework tends to favor those who have been in the same job for decades, who have never changed jobs and who do not intend to do so, to the detriment of young people, who, due to the rigidity of the labor market and the lack of dynamism in and out, are unable to find stable employment. At the same time, others argue that the current legislative framework slows down economic development and innovation, since it prevents employers from managing and adjusting their businesses and human resources so as to make their operations more efficient and. therefore, more competitive. Given the broad protection given by Italian law and jurisprudence, the issue of immunity of foreign states and entities from Italian labor jurisdiction is of a delicate nature.

In Italy, as elsewhere, there are diplomatic missions where both Italian and foreign nationals work. These missions, in accordance with international law, enjoy immunity from local jurisdiction with respect to activities carried out in fulfillment of their institutional purposes and duties. Italian courts, like those around the world, have considered the question of the extent of this immunity in matters of labor relations. Judgment No. 1981 of Feb. 13, 2012, of the Supreme Court, united sections. provides us with an overview of the criteria used to delimit the jurisdiction of Italian courts over labor disputes between foreign diplomatic missions and their employees. The case examined by the Supreme Court concerned a concierge formerly employed by the foreign diplomatic representation, who had been absent from work for reasons of illness, while in truth he had been arrested for committing a crime. The doorman had plea-bargained his sentence and returned to his workplace. The diplomatic mission, learning the true reason for the worker’s temporary absence, notified him of his dismissal for cause. The doorman appealed the dismissal, asking the labor judge to reinstate him to his job. The foreign diplomatic representation objected to the Italian court’s lack of jurisdiction, arguing that any order of reinstatement to the job, would constitute an impermissible interference with the foreign diplomatic representation’s sovereign right to make assessments and decisions regarding its organization. The Supreme Court therefore found Italian jurisdiction over the dispute to be nonexistent.

The Supreme Court, however, recognized the need to balance the need not to interfere with the hetero state’s exercise of sovereign initiatives with that of ensuring the protection of workers’ rights and that, therefore, foreign state immunity cannot be considered unlimited. In particular, the Supreme Court seems to transpose a notion of limited immunity under which, it does not apply:

1) where the dispute concerns an employment relationship inherent in the performance of functions merely auxiliary to the pursuit of the institutional functions of the foreign state;

2) where the dispute, although involving an employee who performs a function that relates directly to the performance of institutional functions of the foreign state, concerns only pecuniary aspects that in themselves are not likely to interfere with the exercise of the aforementioned institutional functions.

Thus, the Court goes so far as to affirm the principle that the immunity of the foreign state does not preclude the jurisdiction of the Italian court in matters of labor dispute, provided that the assessment of the worker’s claim does not require evaluations, investigations and/or decisions that could interfere with the initiatives or conduct of the foreign state, which are an expression of its sovereign power of self-organization. Otherwise, the customary principle “par in parem non habet jurisdictionem” (between equals there is no jurisdiction) applies.

Labor disputes and the jurisdictional immunity of foreign states and entities: the Supreme Court of Cassation addresses the question of the extent of immunity

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