Employee Rights on Transfer of Undertakings: Italian Legislation and EC Law

• Author: Maria Luisa Vallauri,Marco Novella
• Date: 01 January 2008
• DOI: http://doi.org/10.1111/j.1468-0386.2007.00401.x
• Published date: 01 January 2008

Employee Rights on Transfer of

Undertakings: Italian Legislation and

EC Law

Marco Novella and Maria Luisa Vallauri*

Abstract: The authors examine the conformity with Community law of the recent

regulatory changes introduced to the Italian legal system regarding the safeguarding of

employees’ rights during transfers of undertakings. The investigation takes place on the

assumption that the principle of primacy of Community law applies, which first and

foremost means that it must be verified whether the domestic legislation in question

complies with the interpretation given to the relative provisions of Community law.

According to the authors’ opinion, domestic law could be judged as non-conforming to the

interpretation that has been given by the Court of Justice, so that the question may be

brought before the Court of Justice ex Article 226 EC or by recourse to the preliminary

ruling procedure under Article 234 EC, which reveal cases of incorrect implementation of

the Directive.

I Foreword: Purpose and Method of this Analysis

This article examines the conformity with Community law of the recent regulatory

changes introduced to the Italian legal system regarding the safeguarding of employees’

rights during transfers of undertakings.1The need for such an inquiry would appear to

be confirmed by Act No 30/2003, which obliges the Italian Government to ‘totally

adapt the current framework to Community legislation, including requiring its

coordination with Act No 39/2002, which provides for the implementation of Council

Directive 2001/23/EC’ (Article 1(p), n 1).

The investigation will take place on the assumption that the principle of primacy of

Community law applies, which first and foremost means that it must be verified

whether the domestic legislation in question complies with the interpretation given to

the relative provisions of Community law. The technique of interpreting domestic law

* Sections III, IV, IV.A and IV.B are by M. Novella (University of Insubria); sections II, V, V.A and V.B

are by M. L. Vallauri (University of Florence); sections I and VI are by both authors.

1Decree No 276, of 10 September 2003, enacted by the Government on the basis of the enabling act no 30

of 14 February 2003 (the so-called ‘Biagi Act’), amending the previous legislative framework, as set forth

in Article 2112 Civil Code, in the part defining the case in question with reference to the corresponding

Community framework (EC Directive 2001/23/EC, consolidating the two previous Directives, 77/187/EC

and 98/50/EC, respectively).

European Law Journal, Vol. 14, No. 1, January 2008, pp. 55–73.

© 2008 The Authors

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‘in the light of the wording and the purpose of the Directives’2will be applied, subject

to the constraints imposed by the European Court of Justice; that is to say, only if the

domestic law provisions may be interpreted in compliance with Community law.3

If an interpretation in accordance with Community law is not possible, anyone

interpreting domestic law should be aware that the European Commission may initiate

infringement proceedings against the Member State for failure to transpose correctly a

Directive, or that a domestic judge may refer to the Court of Justice for a preliminary

ruling on the case in point. The rule of interpretation ‘in compliance with EC law’ is in

fact fraught by the irremediable disparity between domestic and Community legisla-

tion,4whenever the intervention of national legislators is required, and since domestic

judges are ultimately bound by domestic law, an individual petition may be brought

against the state claiming damages for failure to (correctly) transpose the Directive in

question.5According to the well-established principles of the Court of Justice, notwith-

standing the direct and exclusively vertical—and not horizontal6—effect of Community

Directives containing clear, precise and unconditional legislation, in their judgments on

questions of interpretation, domestic courts may only declare domestic legislation

incompatible and therefore not enforceable when a Member State or public authority

is party to the dispute in question.

For the purposes of clarity, it is important to state from the outset that the criterion

used to measure the extent of conformity of the domestic legal system will be a

comparison with Community provisions subject to the judicial interpretation attrib-

uted to the latter by the European Court of Justice. In fact, in our opinion, the

distinction used between ‘written Community law’ and ‘judge made’ Community law

can at times be misleading. In this respect, one need only consider that any verification

of domestic law’s conformity with Community law (as is also the case for verifying the

constitutionality of law with the Constitution) inevitably takes place between rules and

not between provisions themselves; in other words, by verifying the way texts are

interpreted, and not examining the legislative texts directly. The Court of Justice’s

stated role as guarantor of Community law requires that the ‘interpreted text’ (in other

words, the rule) by which the extent of the domestic provision’s conformity is mea-

sured, is based on the interpretation provided by an ‘official’ and ‘authentic’ interpreter

of Community law. Moreover, as has been unequivocally stated by the Italian Consti-

tutional Court:

since, for the purposes of Articled 164 [now 234] of the Treaty of Rome, the Court of Justice is

responsible for ensuring that law is respected in the interpretation and application of the said Treaty, it

must be concluded that any judicial decision applying and/or interpreting Community legislation has

undoubtedly declaratory character in relation to Community law, since the Court of Justice is the

competent body to interpret such law, and therefore it has the authority to determine the meaning of its

own judgments, and, as such, definitively determines their scope and content of their application.7

2Cf Case C-14/83, von Colson and Kamann [1984] ECR 1891, at 1909; Case C-106/89, Marleasing [1990]

ECR I-4135; Case C-334/92, Wagner Miret [1993] ECR I-6911, point 20.

3von Colson and Kamann,n2supra; more recently Cases C-397–403/01, Pfeiffer [2004] ECR I-8835.

4Marleasing,n2supra.

5Cases C-6/90 and 9/90, Francovich [1991] ECR I-5357, at 5414.

6Case C-152/84, Marshall [1986] ECR 723.

7C. Cost. 11 July 1989, n 389, CG 1989, 1058. Cf also A. Lo Faro, ‘Judicial Development of EC Social

Policy and Intra-Community Institutional Dialogues: How to Define a “Legal Transfer”’, in S. Sciarra

(ed), Labour law in the Courts (Hart Publishing, 2001), 210 et seq.

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© 2008 The Authors

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