A recent decision made by the Italian Supreme Court means that companies can no longer stipulate a contract providing for services as Board Member.
In other words an individual appointed as Board Member, including a CEO or a Managing Director ( in Italian known as ‘Amministratore Delegato‘ or ‘Amministratore Unico‘), can not have a contract ruling his/her role even if he/she is an employee.
In fact, according to this new ruling Board Members can not be bound to any obligation as they must be completely independent.
The decision is particularly important as all such contracts, which are common among American and British companies, are now void in Italy, including ancillary clauses such as non competition covenants, confidentiality, termination date and compensation.
Therefore, it is advisable to review the position of all Board Members in Italy and should some of them have a similar contract it is recommended to substitute the existing contract with a formal decision of the Board of Directors, approved by the members themselves, containing the same terms and conditions, where possible.
Should you require any further information or detail please contact LEXELLENT Partner Sergio Barozzi at sergiobarozzi@lexellent.it .
