Constitutional Court Ruling Increases Severance for Small Business Dismissals

Constitutional Court Ruling Increases Severance for Small Business Dismissals

The Constitutional Court has increased the compensation for employees unlawfully dismissed from companies with fewer than 16 employees. This important update — explained by Andrea Patrizi, partner at QLT — replaces the previous limit of 6 months’ severance.

In his commentary, Andrea Patrizi underlines that the previous narrow range between minimum and maximum penalties no longer reflected today’s economic realities or the capacities of businesses. The Court’s judgment introduces a more flexible approach, allowing compensation of up to 18 months depending on factors such as seniority, company size, and severity of misconduct.

This updated regulatory framework aims to improve deterrence even among economically strong small businesses. However, for contracts signed before March 8, 2015, the mechanisms of Law 604/1966 remain in force, with different limits based on seniority and company size.

Read the full article by Andrea Patrizi on Huffington Post:
What Changes with the Court Ruling on Unlawful Dismissals in Small Businesses