In many companies and groups, a matrix structure – in which employees and managers from different establishments collaborate – is a common model. This structure not only raises interesting questions concerning day-to-day co-determination practice but also in the context of works council elections. For the upcoming election year 2026, the Federal Labor Court has recently issued a landmark ruling.
Affiliation with an establishment as a prerequisite for the voting right
According to § 7, sentence 1 of the German Works Constitution Act (BetrVG), all employees of an establishment who are at least 16 years old are entitled to vote in works council elections. In addition to age and employee status [i.e., not holding an executive role as defined in § 5 (2) and (3) BetrVG], affiliation with an establishment is a key requirement for an active voting right.
This affiliation is primarily determined by actual “integration” into the operational organisation. In times of cross-location collaboration, this determination can be challenging. It is not necessary for an employee to perform their work on the premises of the establishment. What matters is whether the employer works with the employee to pursue the operational purpose of the relevant establishment – this purpose may be pursued across multiple establishments.
But how should integration be assessed if a non-executive matrix manager, for example, manages teams in Frankfurt and Cologne, reports to a superior manger in Hamburg, and primarily works in Berlin or from home there? In which establishment may they vote – Frankfurt, Cologne, Hamburg, Berlin, or even in all of them?
Inconsistent case law on works council elections
Until now, the case law of the regional labor courts on this topic has been inconsistent. While the Regional Labour Courts of Hesse (ruling of 22 January 2024, file ref.: 16 TaBV 98/23) and Munich (ruling of 22 May 2024, file ref.: 11 TaBV 86/23) held that multiple integrations – and thus multiple voting rights – are possible if a matrix manager merely performs technical leadership tasks for several establishments, the Regional Labor Court of Baden-Wuerttemberg (ruling of 13 June 2024, file ref.: 3 TaBV 1/24) reached an opposite conclusion: Matrix managers are generally only entitled to vote in their contractually assigned “home establishment”.
Federal Labor Court brings clarity: Voting rights in multiple establishments possible
With its ruling of 22 May 2025 (file ref.: 7 ABR 28/24, currently only available as a press release), the Federal Labor Court has now provided clarity and appears to follow the line of the courts in Hesse and Munich: Eligibility to vote in one establishment does not exclude eligibility in another, provided there is actual integration into both operational organisations. In practice, this means that a (matrix) manager may be entitled to vote in every establishment where an employee they manage is integrated.
Comparison with § 99 BetrVG: Hiring and relocations
A similar issue arises in the context of hiring and relocations under § 99 BetrVG, which also require “integration”. In 2019, the Federal Labor Court (ruling of 12 June 2019, file ref.: 1 ABR 5/18) ruled in this context that multiple integrations of managers are possible – meaning that in matrix structures, participation under § 99 BetrVG may require the involvement of numerous local works councils.
However, applying a uniform concept of integration to both § 7, 1 and § 99 BetrVG – as the Regional Labor Court of Baden-Wuerttemberg argued against, based on the purpose of the election provision – is not necessarily required. Multiple voting rights for matrix managers would contradict both the fundamental idea of the German Works Constitution Act that an employee should belong to one establishment only, and the aim expressed in § 4 (1) BetrVG to ensure local representation. Moreover, in light of § 47 (7) 1 and 55 (3) BetrVG, which determine the number of votes of general or group works council members based on the number of represented employees eligible to vote, this would lead to unjustified multiple representation.
Practical implications and recommendation
The question of whether matrix managers must be listed on multiple electoral rolls and are allowed to vote in several establishments is of considerable practical relevance. It affects not only the size of the works council to be elected (§ 9 BetrVG) but may also have significant cost implications for employers due to additional training and release requirements – in the relevant case, the discrepancy was that 128 managers had to be recognized! Incorrect assignment can also lead to challenges to the election (§ 19 BetrVG), provided other conditions are met.
Although the Federal Labor Court has now provided legal clarity, practical implementation is not becoming any easier – on the contrary: Instead of assigning managers solely to their “home establishment”, each manager’s (possibly changing) reporting relationships to employees in other establishments must now be examined. This not only contradicts the legal system’s need for practicality and clarity but also poses a significant challenge for election committees. It is hardly feasible for them to determine, with legal certainty and on a case-by-case basis, whether a matrix manager holds a position that justifies assuming integration into the voting establishment. Employers may also face considerable additional effort, as they are obliged under § 2 (2) 1 of the German Works Council Election Regulations (WO BetrVG) to provide all necessary information for compiling the electoral roll.
It also raises the question of whether this considerable effort is proportionate, given that the interests of managers who usually only participate virtually are unlikely to be the focus of local works councils.
The Federal Labor Court – at least in its press release – leaves important follow-up questions unanswered. It remains unclear whether the ruling also affects passive eligibility (§ 8 BetrVG), i.e., whether matrix managers can now also be elected to works councils in multiple establishments. It is also unclear what impact the ruling will have on international corporate structures – will matrix managers based abroad also be eligible to vote in a German Works Council election in the future? The publication of the full reasoning behind the ruling, as well as the pending appeal under file ref.: 7 ABR 16/24 against the above-mentioned decision of the Munich court, is therefore eagerly awaited.
To simplify national structures, some companies may now consider making use of the option to establish voluntary works council structures in accordance with § 3 BetrVG, in order to reflect their day-to-day operations through a cross-establishment representation body. The options and their pros and cons should be carefully evaluated.
