Substitute Teachers' Leave: Supreme Court on Compensation

The Italian Supreme Court (Corte di Cassazione), Labour Section, in judgment no. 16525 of 27 May 2026, has laid down principles of law of considerable significance regarding fixed-term teachers' entitlement to paid annual leave, resolving an interpretive question that had generated widespread litigation and conflicting approaches across lower courts. The ruling clarifies the extent to which substitute teaching staff may claim financial compensation for untaken leave, drawing a sharp distinction between lesson suspension periods during the school year and the interval between the end of lessons and 30 June.

The case and the regulatory framework

The dispute originated from a claim brought by a former fixed-term teacher – subsequently given a permanent position – who sought payment in lieu of untaken leave for several school years during which she had been employed on successive temporary contracts. The first-instance court had partially upheld the claim, recognising only the difference between accrued leave days and the lesson suspension days set out in the regional school calendars, irrespective of whether the teacher had formally applied for leave.

The Turin Court of Appeal, hearing the case on appeal, referred a preliminary question to the Supreme Court under Article 363-bis of the Code of Civil Procedure. The question was whether the principle requiring the employer to formally invite the teacher to take leave – warning of the loss of entitlement in case of refusal – extended beyond the period between the end of lessons and 30 June to encompass lesson suspension periods falling within the school year itself.

The legislative framework

The regulatory system governing teachers' leave operates on multiple levels. Article 74 of Legislative Decree no. 297 of 1994 establishes that the school year runs from 1 September to 31 August, teaching activities take place between 1 September and 30 June, and at least 200 days must be devoted to lessons, with regional calendars determining the start of lessons and suspension periods.

The collective bargaining agreement for the school sector (2006/2009 CCNL) had provided, at Article 19(2), that taking leave during lesson suspension periods was not mandatory for fixed-term staff, with a right to financial compensation upon termination for any leave not requested.

In 2012, the legislature intervened twice: first, through Article 5(8) of Decree-Law no. 95 of 2012, which introduced a general prohibition on the monetisation of leave in the public sector; then, through Article 1, paragraphs 54–56, of Law no. 228 of 2012, which established a special regime for the school sector. Paragraph 54 provides that teaching staff shall take leave during lesson suspension days as defined by regional school calendars, excluding periods reserved for examinations and evaluative activities. Paragraph 55 creates an exception to the monetisation ban for substitute teachers, limited to the difference between accrued leave days and the days on which leave could have been taken.

The legal question examined

The interpretive issue submitted to the Supreme Court essentially concerned two aspects. The first related to the scope of the school principal's duty to inform: whether, during lesson suspension periods within the school year – such as Christmas, Easter and Carnival holidays – the principal was required to formally invite the substitute teacher to take leave, warning of the loss of entitlement, or whether that obligation applied only to the period between the end of lessons and 30 June. The second aspect concerned whether analogous principles applied to the rest days provided for by Law no. 937 of 1977.

Lower courts had split on the issue: some held that the employer's duty to inform extended to all suspension periods, interpreting the statutory language ("fruisce", "è consentito") as indicating a mere faculty rather than an obligation; others confined that principle to the period between the end of lessons and 30 June, reasoning that during suspension days set by regional calendars the teacher was automatically in a position to take leave without any formal notice.

The Court's decision and principles of law

The Supreme Court declared the preliminary reference admissible, finding the requisite "novelty" of the question. The Court's own precedents had either concerned cases still governed by the previous collective bargaining agreement or had been expressly confined to the period between the end of lessons and 30 June, without directly addressing the question of suspension periods during the school year.

The principle established for leave entitlement

The Court laid down the following principle of law: short-term and occasional substitute teachers, or those employed until the end of lessons or teaching activities, are entitled to financial compensation for untaken leave only to the extent of the difference between accrued leave days and the lesson suspension days defined by regional school calendars falling within the period between the start and end of lessons. During that period, leave may be taken by operation of law, without any need for formal notice from the school principal; such notice is, however, required for the period between the end of lessons and 30 June, which is ordinarily devoted to examinations and evaluative activities.

The regime for rest days under Law no. 937/1977

Regarding the four rest days provided for by Law no. 937 of 1977, the Court held that an analogous regime applies: such days must be taken by substitute staff by the end of the school year or, in any event, by the end of the last contract entered into during that school year. The collective bargaining agreement permits their use exclusively during lesson suspension periods, under a framework substantially equivalent to that governing annual leave.

Operational and practical implications

The distinction between two periods within the school year

The most practically significant aspect of the ruling lies in the sharp distinction drawn by the Court between two distinct time segments.

During lesson suspension periods within the school year – that is, during breaks set by regional calendars (Christmas, Easter and other holidays) – teachers are not required to carry out teaching duties or, as a rule, collegial activities. On those days, the sector-specific legislation permits leave to be taken freely, and a fixed-term teacher who chooses not to do so, without submitting a formal request, forfeits the corresponding share of financial compensation. No formal communication from the school principal is required, since the statutory framework, together with the regional calendars published in advance, fulfils in itself the informational function that EU case law attributes to the employer.

By contrast, during the period between the end of lessons and 30 June, teachers are ordinarily engaged in activities ancillary to teaching – examinations, assessments, collegial duties – and are required to remain at the disposal of the school principal. For this time segment, the teacher cannot freely take leave, and the principal's obligation to expressly communicate the possibility of doing so, together with a warning of the loss of entitlement in case of non-use, remains fully in effect.

Compliance with European Union law

The Court devoted particular attention to the compatibility of its interpretation with Article 7 of Directive 2003/88/EC, as construed by the Court of Justice of the EU. The national framework was found to be compliant because it effectively places the teacher in a position to take leave during lesson suspension periods and, at the same time, warns – through the very statutory provision on the monetisation ban – that a decision not to take leave will result in the loss of the corresponding financial compensation. The CJEU's own case law, moreover, has envisaged the employer's duty to warn only "where necessary", thereby acknowledging that in working contexts characterised by predetermined rhythms – such as the school system – the required information may derive directly from the sector-specific regulatory framework.

No automatic allocation of leave

The ruling clarified that the legislation does not provide for any mechanism of automatic allocation of leave during lesson suspension periods. The employee's request remains necessary, consistently with the relevant collective bargaining provisions. What changes is the consequence of a failure to request leave: during suspension periods within the school year, the teacher who does not apply for leave retains the status of being available for service but loses the right to the corresponding financial compensation, limited to the days on which leave could have been taken.