Let’s raise the bar for European Works Councils

DISCLAIMER: All opinions in this column reflect the views of the author(s), not of EURACTIV.COM Ltd.

EWCs should be a dynamic forum where employees can participate in a company's strategic decisions. [Matej Kastelic/Shutterstock]

EU rules on Works Councils need to push for higher standards and promote workers’ rights, not simply reflect the status quo, writes Stan De Spiegelaere.

Stan De Spiegelaere is a researcher at the European Trade Union Institute (ETUI) and recently published the report ‘Too little, too late? Evaluating the European Works Councils Recast Directive’.

It is a fundamental right for employees to be informed and consulted by the management on company strategy. However, with the EU integration, management of multinationals tends to surpass the national level. Being informed and consulted by the national management loses its significance when talking about transnational company issues.

To address this gap, the EU organised transnational information and consultation rights through European Works Councils. Since the official launch of the first EWC Directive in 1994, over 1,000 have been established, mobilising tens of thousands employee representatives and covering over 19 million employees in the EEA.

While these numbers might suggest the programme has been a success, the reality on the ground is mixed. A lot of companies that could have an EWC still do not. Also, a great many EWCs struggle to be vibrant forums for discussion or exchange and are rarely in a position to influence strategic company decisions.

So the EU decided to raise the bar for EWCs in 2009 by agreeing on a recast of the original EWC Directive to include additional rights for employee representatives (like training) and clarity on what should be understood by information and consultation and an indication of when this should happen (before the decision is final). The objective of these changes was clear: existing and future EWCs had to be more effective.

Raising the bar (up to the minimum)

So did the recast manage to improve the functioning of the EWCs? Looking at the EWC agreements, the results are mixed. For one thing, what should be understood by information and consultation has been clarified in the EWC agreements. However, several other changes introduced by the recast, such as a right to training, have been less successful. Research shows that agreements from after the recast are not more likely to bring training rights than those from before.

So why is this? The policy raised the bar to a level all recent EWC agreements had already reached. Although training was not an official right for employee representatives, EWCs quickly recognised that it was indispensable. Without adequate legal, economic and financial skills, EWC meetings are difficult to run. So relatively quickly, more and more EWCs started to provide for training, and by the time the recast made training a real ‘right’, virtually all EWC agreements had already accounted for this.

The recast EWC Directive raised the bar to the minimum, not the maximum.

The policy, in other words, didn’t introduce a new right, it merely reflected widely established practices: the lowest common denominator, not the best practices.

The way forward

So does this mean policy is redundant and everything should be left to the mutual learning of EWCs? No, for three main reasons:

  1. Lots of EWCs are still not effective: even though EWCs tend to learn and copy practices, the bulk of EWCs still do not manage to make full use of their information and consultation rights. Research has repeatedly identified success factors for EWCs and one recurring factor is having multiple meetings.
    Meeting once a year rarely is enough for vibrant and dynamic information and consultation. The same goes for having trade union representatives in EWC meetings and providing employees with the possibility to go and visit companies to meet with employees. These factors have proven successful but weren’t pushed for by the Recast.
  2. Inactive EWCs stay inactive: while it is true that training was omnipresent even before the recast, this only holds for those EWCs that were established in that period or renegotiated their agreement at that time. But what about those many EWCs that never renegotiated their agreement and thus didn’t have the opportunity to update their functioning? How they are affected by the recast remains an open question.
  3. Almost one out of two EWCs are exempted from the rules: due to a special clause in the Directive, EWCs established before a certain date are not covered by the Directive or the recast. These are ‘voluntary’ EWCs. Still over 40% of all EWCs can be considered voluntary and while some of them function well, on average, these EWCs are still less likely, for example, to have clear definitions of what information and consultation should be or to hold an employee-only preparatory and debriefing meeting. For these EWCs, the Recast was (and is) a toothless tiger.

So clearly, European policy-makers do have the ability to really improve the effectiveness of EWCs. However, for this they will need to go from a policy focused on reflecting the lowest common denominator to one stimulating good working practices. Policy-makers need to raise the bar and incite EWCs to copy good practices. And last but not least, policy-makers need to seriously reflect on how to handle the long shadow of the first EWC Directive and how to phase out the age-old voluntary EWCs.

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