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In business until the age of 70: not a right, need for an agreement between the parties

Unlawful dismissal in the case of a tacit retention agreement

by Angelo Zambelli

28 August 2025

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Key points

Negotiable agreement
The position of the Supreme Court

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With the demographic curve plunging and the difficulties in finding new resources or talent, instruments to encourage continued employment after reaching retirement age are back on the agenda.

With Article 24, paragraph 4, of the Salva Italia decree (Decree Law 201/2011), converted into Law 214/2011, the legislator provided for a incentive mechanism to prosecution of employment up to 70 years of age by valorising, with more favourable transformation coefficients of the contributions paid, the longer period of employment.

Negotiable agreement

However, it should be clarified immediately that this case does not grant the employee "the potential right to continue in the employment relationship" until reaching the age of 70, but merely offers the "possibility that, thanks to the operation of transformation coefficients calculated up to the age of 70, the conditions are created to allow the workers concerned to continue in the employment relationship beyond the limits provided for by the discipline of the sector". Thus the Unified Sections of the Court of Cassation in its judgment 17589 of 4 September 2015, which also specified that such a legal qualification of the incentive referred to in Article 24 cited above always requires an agreement of the parties, who "consensually establish the continuation of the relationship on the basis of a mutual assessment of interests".

No automatism, therefore, but a regulatory framework that makes it negotiable - on a case-by-case basis - to remain in service beyond retirement age, with a view to flexibility and valorisation of professional experience.

In this context, and in the silence of the rule - which says nothing about the concrete modalities of exercising the right to continue the employment relationship, unlike the previous provisions on the subject - the jurisprudence on the merits has held that the agreement required can be concluded in a free form, even orally or by concluding facts, and this in consideration of the principle of freedom of forms in force in our system.

The position of the Supreme Court

The same conclusions were recently reached by the Court of Cassation in Order No. 23603 of 20 August 2025, concerning a worker dismissed for having reached the pension requirements. In particular, the Court of Merit, hearing the case, had declaredthe dismissal unlawful, considering that there had been a tacit agreement to keep the worker in service beyond the maturation of the retirement requirements.

The Court of legitimacy confirmed the correctness of the decision on the merits, recognising the legal value of the conclusive conduct of theparties: the employee, on the one hand, who had continued his activity despite having reached the pension requirements, and the employer, on the other hand, who had accepted the continuation, keeping the employee in service.

Confirming the centrality of theagreement between the parties - be it express or tacit - the Court of Cassation, in its order 23616 of 20 August 2025, ruled out, on the other hand, that a resolution of the board of directors - on which, in the case in point, a bank manager had relied for his permanence in service at the time of accrual of the right to retirement - could constitute a contractual obligation for the purposes of maintaining the employment relationship. Rather - the Court pointed out - the board resolution constitutes an internal act of the company and necessitates, in order to assume external relevance, "a further formal act taken by the person endowed with the power of representation" of the entity: in other words, an agreement between the parties is still necessary.

From the interpretation of the regulatory framework centred on the need for an agreement (even tacit) between the parties regarding the continuation of the employment relationship, it follows that the legal extension of the protection provided by Article 18 of the Workers' Statute in the case of unjustified dismissal - provided by the last sentence of Article 24, paragraph 4, of Decree Law 201/2011 - can operate only in the presence of such an agreement. Otherwise, the attainment of the pension requirements allows the free termination of the employment relationship, exposing the employee to a dismissal that is not assisted by any protection other than that of notice.