Strengthening the European Works Council

Directive 94/45/EC and 2009/38/EC on the establishment of a European works council or a procedure in Community-scale undertakings and Commu­nity-scale groups of undertakings for the purposes of informing and consulting employees, corresponded to the tendency of national undertakings to become active even outside of their own member state, in particular, for cost reasons, in Europe. Informing and consulting a representative of the entire European workforce about the ­development of the business situation and the perspectives of the Community-scale undertaking, and in the event of transnational measures, are still useful and effective today. The German law based on these Directives on European works councils has proven its worth since 2011.

20 This article engages in a critical reflection on the core points of this initiative from the point of view of employers, in particular, against the backdrop of the prevailing polycrisis, the incongruent dependency of European economies on third countries and the claim to reduce red tape and, thus, with regard to time aspects.

The main issues of the proposal of the EU Commission of 24 January 2024

Eight key issues of the proposal of the EU Commission can be mentioned:

• Extension of informing and consulting with provisions on the temporal situation for information for and consultation of the European employee ­representation body (new Art. 9)
• Extension of the scope of application of the information and consultation obligation for transnational matters [new Art. 1 (4)]
• Regulations on the confidentiality of disclosed information (new Art. 8)
• Possibility of non-transmission of information for certain reasons (new Art. 8a)
• Granting legal protection to the European employee representation body [new Art. 11 (2a)]
• Sanctions in the event of violations of the Commu­nity-scale undertakings or the Community-scale groups of undertakings [Art. 11 (2b)]
• Gender equality-based staffing of the European ­employee representation body [new Art. 5 (2a)]
• Admission of virtual meetings (recitals 8 of the ­Commission’s draft)

Selected key issues in detail

Regulations on the participation of the European employee representation body

Previously, only annual information or incident-related information during the year was provided in cases of ­exceptional circumstances, in particular, in the event of relocations and closures of undertakings or companies with no timing for the information, consultation and ­implementation of the measures either. Now, the initiative of the Commission provides for the involvement of the European employee representation body prior to the execution of a measure in such a way and with content that allows a thorough assessment of possible effects and to prepare consultation, if necessary [new Art. 9 (2)]. The subsequent consultation should then give the European employee representation body the opportunity, under the same conditions, to express its views even prior to the ­execution of the measure. The statement of the European employee representation body should be answered by the management in writing and be justified prior to the implementation of the measure as well.

This intensification of the participation rights of the European employee representation body will have a significant impact on the implementation of planned measures. No time limits are provided for the consultation procedure or the statement of the European employee representation body. This intensification of the participation rights of the European employee representation body can thus counteract, for instance, the German regulations on the conciliation committee proceedings.

Extension of the scope of application of the information and consultation obligation for transnational matters [new Art. 1 (4)]

To date, it has been necessary for the establishment of the competence of the European employee representation body that a measure concerns two undertakings or companies in at least two member states.

The initiative of the EU Commission now provides for competence of the European employee representation body even if the planned measure (only) gives rise to a reasonable expectation that it will affect employees in ­undertakings or companies in more than one member state, or that the planned measure could impact ­employees in one undertaking or company in one member state (only) at reasonable discretion, and that employees in one undertaking or company in another member state could be affected by the consequences of these measures at reasonable discretion.

Not only does this regulation entail legal uncertainty; it has not yet been defined what is meant by “at reasonable discretion” and “reasonably” either. As undertakings opera­ting in the European Community are very often organized in matrix structures and production facilities are distri­buted across several member states, it can be assumed that a measure in one member state necessarily has an impact on companies in another member state. This regulation may, therefore, also result in a general competence of the European employee representation body.

Access to legal protection [new Art. 11 (2a)]

Here, the initiative provides for a two-stage procedure.

On the one hand, the member states should have appropriate procedures in place that enable them to enforce the rights and obligations deriving from the Directive in its new version in a timely and effective manner. In addition to issues of the competence of the European employee representation body, issues of safeguarding the information and consultation rights of the European employee representation body may become the subject matter of the dispute here. On the other hand, it is planned that member states may be able to make access to court proceedings subject to conducting alternative dispute resolution proceedings. However, these proceedings may neither result in a binding decision for the parties concerned nor affect the right of the parties concerned to initiate court proceedings.

This provision threatens to cause further delays regarding the adoption of measures and making the European ­employee representation body a real co-determination body. The question whether a European employee ­representation body was involved in a sufficient, timely and comprehensive manner can always be posed.

Virtual meetings of the European employee representation body

Directive 2009/38/EC includes the requirement to determine the location where the European employee ­representation body convenes. There are plans to make it possible to hold all or certain meetings of the European employee representation body in a virtual environment by means of video conference tools and online tools. By ­doing so, the environmental impact of the meetings may be reduced in accordance with the emission reduction targets of the EU, the member states and the undertakings, while ensuring reasonable information and consultation at a lower ecological and financial cost.

The possibility to hold virtual (information, consultation but also their own internal) meetings of the European ­employee representation body is certainly to be welcomed. This possibility moves with the times, will make cooperation with the European employee representation body more flexible, will save money and is also more sustainable from an ecological point of view.

Summary

An undertaking does not restructure as an end in itself but in order to secure its future. In this context, the EU member states have laid down different but detailed and ­manageable regulations for employee participation. Strengthening the European employee representation body by extending information and consultation, the area of competence for transnational measures, as well as ­potentially even court proceedings with a suspensory ­effect for the planned measures, means weakening the ­European Economic Area.