Physical Address
304 North Cardinal St.
Dorchester Center, MA 02124
A recent ruling by the Italian Supreme Court (Corte di Cassazione) provides important insights into the topic of executive dismissal. The Court confirmed that a manager may be legitimately dismissed if they are found inadequate in fulfilling their duties. However, such dismissal must be based on serious deficiencies in job performance, rather than the mere failure to meet assigned business objectives.
🏦 The Case: Bank General Manager Dismissed for Operational Shortcomings
The case involved a general manager of a bank, dismissed for just cause due to serious professional misconduct. The employer accused the executive of behavior incompatible with the role’s responsibilities, highlighting errors and inadequacies in credit recovery and internal control management.
Although the executive challenged the dismissal, both the Labour Tribunal and the Court of Appeal upheld the legitimacy of the disciplinary action, confirming that the allegations were proven.
📄 The Appeal to the Supreme Court
The manager appealed to the Supreme Court, arguing that the dismissal was based on the failure to meet specific targets and therefore unlawful. According to the executive, the employment contract did not require them to achieve specific results, but only to perform their duties diligently and competently.
This argument touches on a recurring debate in Italian case law regarding goal-oriented employment contracts.
🎯 Targets vs. Duties: What Really Justifies a Dismissal?
The Supreme Court took this opportunity to reaffirm a key principle in Italian labor law: even for executives, the employment relationship is based on the proper and diligent execution of tasks, not necessarily the achievement of specific results.
As a result, dismissal for failure to meet objectives can only be deemed legitimate in exceptional circumstances, specifically when:
- there is a clear and substantial discrepancy between expected and actual outcomes;
- the underperformance is persistent, not occasional;
- the gap is due to negligent or inadequate conduct on the part of the executive.
🧾 What the Court Ruled: Inadequacy ≠ Failure to Meet Goals
In this case, the Supreme Court dismissed the executive’s appeal, noting that the dismissal for just cause was not due to the failure to meet performance targets but rather to serious violations of professional duties.
The deficiencies in credit management, debt collection, and the internal control system were considered clear evidence of the executive’s inadequacy in fulfilling the responsibilities of their role. This inadequacy was viewed as a breach of work obligations, sufficient to justify immediate dismissal for just cause.
🧠 Final Thoughts: Focus on Job Performance, Not Just Results
This Supreme Court decision offers an important clarification: an executive’s dismissal cannot be based solely on the failure to meet business targets unless there is evidence of professional misconduct or negligence.
The key factor remains the adequacy and diligence in carrying out assigned tasks—particularly relevant for top-level roles, such as that of a general manager, where decision-making has significant organizational impact.
