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According to article 2112 of the Italian Civil Code, on the safeguard of employees’ rights in case of transfer of a business or part of a business, such transfer includes any transaction that, as a consequence of a legal transfer or a merger, entails a change in the ownership of an organized economic activity or of a functionally autonomous part of that activity. 

With judgment no. 1316 of 19th January 2017, the Court of Cassation has explained that, as to the definition of “transfer” set out in Article 2112 of the Civil Code, it is necessary that, once transferred, the part of a business be able to carry out its own activity, autonomously from the transferor and from the transferee.

Therefore, the transaction at issue is to concern a functionally autonomous part of a business, whose autonomy exists even before the transfer.

In the opinion of the Court, there is no transfer of part of a business, and therefore Article 2112 of the Civil Code does not apply, in a case in which only employees, and not also goods and instruments which are essential for the autonomous execution of the economic activity, are transferred. Such transaction may be defined as an outsourcing, not as a transfer.