Compensation in case of misclassification of self-employment relationship

5 August 2024

In cases where the subordinate nature of the employment relationship is established, the indemnification regime under Article 32 of Law No. 183/2010 does not apply, but the ordinary compensation regime does.

In the case at hand, a journalist whose employment relationship had ended after he had been employed as a self-employee by a newspaper, with several temporary contracts and continuously for more than ten years, brought a misclassification claim against the newspaper before the court to be employed permanently.

The Court partially upheld the journalist's claim, recognising the subordinate nature of the employment relationship with the newspaper. However, it reinstated him within the company, providing only compensation according to Article 32 Law No. 183/2010, related to the breach of the fixed-term contracts' provisions.

The Supreme Court ruled that an employee who misclassifies a self-employment relationship, even if on a fixed-term basis, is entitled to full compensation for damages.

According to the Court, the above legislation applies only in the case of a declaration of the violation of the provision related to the term agreed for an employment contract, entailing less severe consequences and not overlapping with the case at issue.

On the contrary, the employee is entitled to compensation equal to the wages lost from the claim to the actual reinstatement in the company.

2024 - Morri Rossetti

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