According to the ruling from the Court of Justice of the European Union, EU law can prevent transferred workers, even those employed by a public authority of a Member State and taken over by another public authority, from suffering a substantial reduction in salary by reason only of the transfer.

The judgement from the Court of Justice of the EU regarding the preliminary ruling from Italian court in the case C-108/10, points out that the takeover by a public authority of a Member State of staff employed by another public authority constitutes a transfer of an undertaking where that staff consists in a structured group of employees who are protected as workers by virtue of the domestic law of that Member State.

This decision is based in the fact that, as reminded by the Court, according to EU legislation on transfer of undertakings and the maintaining of workers' rights in this cases, the rights and obligations arising from a contract of employment or from an employment relationship existing on the date of a transfer are transferred from the original authority to the subrogee. Furthermore, the Court reminds that the terms and conditions agreed in any collective agreement must continue to be observed in the same terms applicable to the transferor under that agreement, until the date of termination or expiry of the collective agreement or the entry into force or application of another collective agreement.

The Court of Justice concludes that when the transfer of an undertaking or a public authority leads to the immediate application to the transferred workers of the collective agreement in force with the final entity, this application must not lead to a substantial loss of salary by reasons such as the link of remuneration to the length of service. According to the Court, it is to national jurisdictions to examine whether, at the time of the transfer at issue, there was such a loss of salary.