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With its ordinance no. 6782 of March 14, 2024, the Italian Supreme Court (Corte di Cassazione) weighed in on a highly debated issue in employment law: whether an employee who resigns with notice is entitled to compensation when the employer waives the notice period and exempts them from working.
This ruling marks a significant shift in legal interpretation and clarifies when such compensation is not due.
The Case: Resignation with Notice and Waiver of Work Duties
The dispute originated between a former employee and her employer. After submitting her resignation with the required notice period, the employee was exempted from working during that time. She later sought payment of the corresponding notice compensation, which led to a legal battle that ended before the Supreme Court.
Lower courts had sided with the employee, holding that the employer’s exemption did not invalidate the employee’s right to receive payment equivalent to what she would have earned during the notice period.
The Supreme Court’s Ruling: Notice Is an Obligation, Not a Right
The Supreme Court, however, overturned the lower court’s decision and ruled in favor of the employer. The key principle affirmed is that the notice period has an obligatory nature, not a “real” (enforceable) one, which has significant legal consequences.
According to this interpretation, the notice period is not a right to continue the employment relationship, but rather a conditional obligation that can be fulfilled either by working during the notice or by paying compensation.
The Employer’s Waiver Ends All Obligations
One of the central elements of the ruling is the employer’s right to waive the notice period. In cases like this, when the non-terminating party (the employer) chooses to waive the employee’s obligation to work, there is no obligation to pay the notice indemnity.
As the Court stated, “no legally protected interest can be recognized in favor of the terminating party.” Therefore, the employee has no right to demand compensation, because the employer’s waiver is legally valid and doesn’t trigger any payment obligations.
Function of the Notice Period: A Safeguard for the Party Receiving the Termination
The Court also addressed the economic function of the notice period, emphasizing that it exists to mitigate the negative effects of termination for the party who did not initiate it:
- In dismissals, it protects the employee by ensuring a temporary income while seeking new employment.
- In resignations, it protects the employer by giving them time to replace the departing employee.
Because the employer is the non-terminating party in a resignation, the Court ruled that they are free to waive that protection without creating financial liability.
Legal and Jurisprudential References
The Court referred directly to Article 2118 of the Italian Civil Code, which governs terminations in indefinite employment contracts.
It also reaffirmed previous rulings, particularly Cass. no. 11740/2007, which confirmed the obligatory nature of the notice period. Other rulings cited include decisions nos. 21216/2009, 13959/2009, 22443/2010, and 27294/2018 — all consistent with the view that the party not initiating termination may freely waive the notice period.
Practical Implications for Employees
The ruling raises several practical concerns, especially for employees. If an employer can waive the notice period without paying compensation, a resigning worker could unexpectedly find themselves without income and employment earlier than planned.
This could significantly disrupt personal and financial planning, particularly in situations where a smooth transition to a new job was expected.
Collective Agreements Still Offer Additional Protections
It’s crucial to remember that many national collective agreements (CCNLs) include specific provisions requiring the payment of notice compensation even when the employer waives the notice period.
One such example is the Commerce Sector Agreement, which explicitly grants this right to the resigning employee. These more favorable terms override general judicial interpretations and must be respected by employers.
Conclusion: A Clear Principle That Requires Caution in Application
The Italian Supreme Court’s ruling in ordinance no. 6782/2024 establishes a clear rule: if an employer waives the notice period following an employee’s resignation, no compensation is due. However, applying this principle in practice requires careful attention, particularly when collective agreements may provide different protections.
While the ruling offers legal clarity, it also calls for practical prudence. Each case must be evaluated on its own merits, and employers are strongly advised to review their applicable collective agreements before deciding to waive a resigning employee’s notice period.
