By Michele Sacchi – Of Counsel, Labour Law Department
One of the most delicate situations for entrepreneurs and HR managers is certainly that of an employee who, over time, records a level of productivity significantly below the company’s expectations or that of comparable colleagues.
The question that often arises is straightforward: can an employee be dismissed because they “produce too little”?
The answer is yes, but only under very strict conditions.
The Italian Supreme Court, including in judgments no. 9453/2023 and no. 20284/2023, has reiterated that dismissal for poor performance constitutes a form of dismissal for subjective justified reason pursuant to Article 3 of Law no. 604/1966 and therefore requires proof of a serious breach of the employee’s contractual obligations.
Simply failing to meet targets is not enough
The case law is very clear on one fundamental point: in an employment relationship, an employee does not normally assume an obligation to achieve a specific result, but rather an obligation to perform their duties with appropriate diligence.
This means that the mere failure to achieve targets, budgets or KPIs is not, in itself, sufficient to justify dismissal.
The employer must instead demonstrate that the poor performance results from:
- negligence;
- lack of commitment;
- insufficient professional diligence;
- culpable and repeated conduct by the employee.
In other words, it is not enough to show that the employee “performs poorly”: the employer must prove that the poor performance is attributable to the employee’s own conduct.
The elements that the Supreme Court considers decisive
The most recent judgments place particular emphasis on a number of key factors.
1. Clear and verifiable objectives
The employer must be able to demonstrate:
- work programmes;
- KPIs;
- productivity standards;
- assigned objectives;
- objective evaluation criteria.
The more these elements are formalised and shared, the stronger the basis for sustaining the dismissal.
2. Comparison with colleagues
A central element is the comparison with comparable employees.
The Supreme Court considers it legitimate to assess, for example:
- clients acquired;
- sales visits;
- matters handled;
- sales completed;
- production volumes,
by comparing the employee’s results with those achieved by other employees performing similar duties.
3. Persistence over time
An occasional decline in productivity is not sufficient.
Poor performance must be:
- consistent;
- repeated;
- significant over time.
4. Disciplinary procedure
Since dismissal for poor performance falls within dismissal for subjective justified reason, the disciplinary procedure provided for under Article 7 of the Italian Workers’ Statute must be fully complied with:
- written notification of the allegations;
- opportunity for the employee to present a defence;
- assessment of the employee’s explanations;
- proportionality of the sanction.
A matter requiring particular caution
Many disputes arise from allegations that are too generic or from purely “intuitive” assessments of an employee’s poor performance.
By contrast, dismissal for poor performance requires a highly technical approach based on objective criteria, proper comparisons and a rigorous evidentiary framework.
For this reason, preventive assistance from professionals specialised in employment law and industrial relations often makes the difference between a defensible dismissal and high-risk litigation.
The Employment Law and Industrial Relations Department of Bacciardi Partners regularly assists companies, HR managers and corporate groups in managing complex disciplinary matters, supporting management both at the preventive stage and in any subsequent litigation.