CJEU Case C-652/19 / Judgment

1) This request for a preliminary ruling concerns the interpretation of Council Directive 98/59/EC of 20 July 1998 on the approximation of the laws of the Member States relating to collective redundancies (OJ 1998 L 225, p. 16), of Clause 4 of the framework agreement on fixed-term work concluded on 18 March 1999 (‘the Framework Agreement’) and annexed to Council Directive 1999/70/EC of 28 June 1999 concerning the framework agreement on fixed-term work concluded by ETUC, UNICE and CEEP (OJ 1999 L 175, p. 43), and of Articles 20 and 30 of the Charter of Fundamental Rights of the European Union (‘the Charter’).

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25) The referring court questions whether that situation is compatible with Directive 98/59 and Clause 4 of the Framework Agreement, read in the light of Articles 20 and 30 of the Charter.

26) In the first place, according to the referring court, the compensation to which the applicant in the main proceedings is entitled does not constitute adequate compensation for unlawful collective redundancy for the purposes of Article 30 of the Charter. Indeed, it would appear from the Explanations relating to the Charter of Fundamental Rights (OJ 2007 C 303, p. 17) that Article 30 of the Charter should be interpreted in the light of Article 24 of the European Social Charter, signed in Turin on 18 October 1961. This in turn has, it is stated, been interpreted by the European Committee of Social Rights to the effect that a penalty arising from unlawful collective redundancy is considered adequate where it provides for (i) the reimbursement of the financial losses suffered by the worker concerned between the date of his or her dismissal and the decision ordering the employer to reimburse him or her, (ii) the possibility of reinstating that worker in the company and (iii) compensation in an amount high enough to deter the employer and to compensate for the damage suffered by the worker concerned.

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28) In those circumstances the Tribunale di Milano (District Court, Milan) decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:

1. 'Do the principles of equal treatment and non-discrimination enshrined in Clause 4 of [the Framework Agreement] on employment conditions preclude the legal provisions of Article 1(2) and Article 10 of [Legislative Decree No 23/2015] which, with regard to collective redundancies that are unlawful due to non-compliance with the selection criteria, provide for a dual and differentiated system of protection whereby, in the same procedure, appropriate, effective and dissuasive protection is provided in respect of employment relationships of indefinite duration created prior to 7 March 2015 – for which reinstatement and the payment of employer’s contributions are envisaged as possible remedies – yet limited compensation only, between maximum and minimum amounts, is offered in respect of fixed-term employment relationships having the same length of service, in that they were created prior to that date but converted to an open-ended contract after 7 March 2015, which is a less effective and dissuasive form of protection?
2. Do the provisions contained in Articles 20 and 30 of the [Charter] and in Directive [98/59] preclude a legal provision such as Article 10 of [Legislative Decree No 23/2015] which introduces exclusively for workers hired (or whose fixed-term contract was converted) for an indefinite duration after 7 March 2015 an arrangement whereby, in the event of collective redundancies that are unlawful due to non-compliance with the selection criteria, reinstatement is not an option – unlike for the other similar employment relationships established beforehand and involved in the same procedure – and which instead introduces a concurrent system of compensation only which is insufficient to make good the financial consequences resulting from the loss of employment and which is inferior to the other coexisting model, applied to other workers whose relationships have the same characteristics with the sole exception of the date of conversion or creation?’

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31) The referring court asks the Court whether the new system introduced by Legislative Decree No 23/2015 is compatible with the Framework Agreement, Directive 98/59 and Articles 20 and 30 of the Charter.

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34) Moreover, the provisions of the Charter apply, pursuant to Article 51(1) thereof, to the Member States only when they are implementing Union law. Article 6(1) TEU and Article 51(2) of the Charter make it clear that the Charter does not extend the field of application of Union law beyond the powers of the European Union, and does not establish any new power or task for the European Union, or modify powers and tasks as defined in the Treaties. The Court is, therefore, called upon to interpret, in the light of the Charter, the law of the European Union within the limits of the powers conferred on it (order of 4 June 2020, Balga, C‑32/20, not published, EU:C:2020:441, paragraph 34 and the case-law cited).

35) It is, therefore, appropriate to reformulate the questions referred for a preliminary ruling as seeking the interpretation of Clause 4 of the Framework Agreement, on the one hand, and Directive 98/59, read in the light of Articles 20 and 30 of the Charter, on the other.

36) By its second question, which it is appropriate to examine first, the referring court asks, in essence, whether Directive 98/59 and Articles 20 and 30 of the Charter must be interpreted as precluding national legislation which provides for the concurrent application, in the course of one and the same collective redundancy procedure, of two different systems for the protection of permanent workers in the event of a collective redundancy carried out in breach of the criteria for determining which workers will be dismissed under that procedure.

37) Contrary to what the referring court implies, it is not sufficient, for the purpose of finding that the provisions of Italian law at issue in the main proceedings implement Directive 98/59, that those provisions form part of broader national legislation, certain other provisions of which were adopted in order to transpose that directive into national law. In order for it to be found that Directive 98/59 and, consequently, the Charter, are applicable to the main proceedings, that directive must impose a specific obligation in respect of the situation at issue in those proceedings, which has been implemented by the provisions of Italian law concerned (see, by analogy, order of 4 June 2020, Balga, C‑32/20, not published, EU:C:2020:441, paragraph 27).

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43) It should also be borne in mind that, under Article 6 of Directive 98/59, Member States must ensure that judicial and/or administrative procedures for the enforcement of obligations under that directive are available to the workers’ representatives and/or workers. Article 6 does not require Member States to adopt a specific measure in the event of a failure to comply with the obligations laid down in Directive 98/59, but leaves them free to choose between the different solutions suitable for achieving the objective pursued by that directive, depending on the different situations which may arise. As the referring court pointed out, in essence, those measures must, however, ensure real and effective judicial protection under Article 47 of the Charter and have a real deterrent effect (order of 4 June 2020, Balga, C‑32/20, not published, EU:C:2020:441, paragraph 33 and the case-law cited).

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45) Furthermore, since national legislation providing for the concurrent application, in the course of one and the same collective redundancy procedure, of two different systems for the protection of permanent workers in the event of an unlawful collective redundancy does not come within the scope of Directive 98/59, that national legislation cannot be regarded as implementing EU law within the meaning of Article 51(1) of the Charter and, consequently, cannot be examined in the light of the guarantees of the Charter and, in particular, of Articles 20 and 30 thereof.

46) It follows from all the foregoing considerations that national legislation which provides for the concurrent application, in the course of one and the same collective redundancy procedure, of two different systems for the protection of permanent workers in the event of a collective redundancy carried out in breach of the criteria for determining which workers will be dismissed under that procedure does not come within the scope of Directive 98/59 and cannot, therefore, be examined in the light of the fundamental rights guaranteed by the Charter and, in particular, Articles 20 and 30 thereof.