Comparison tables on: (1) Changes to EWC...

EWC Directive

Comparison Between Existing Text and Proposed Text

Existing Text

Proposed Text

Article 1: “Transnational”

4.   Matters shall be considered to be transnational where they concern the Community-scale undertaking or Community-scale group of undertakings as a whole, or at least two undertakings or establishments of the undertaking or group situated in two different Member States.

4.           Matters shall be considered to be transnational where they can reasonably be expected to concern the Community-scale undertaking or Community-scale group of undertakings as a whole, or at least two undertakings or establishments of the undertaking or group situated in two different Member States. 

Those conditions shall be deemed to be met where:

(a)          the measures considered by management of the Community-scale undertaking or Community-scale group of undertakings can reasonably be expected to affect workers in undertakings or establishments in more than one Member State;

(b)         the measures considered by management of the Community-scale undertaking or Community-scale group of undertakings can reasonably be expected to affect workers in an undertaking or establishment in one Member State, and workers in an undertaking or establishment in another Member State can reasonably be expected to be affected by the consequences of those measures.

Comment: 

Despite the suggestion in the Commission documentation that this new definition of transnational, which incorporates Recital 16 from the 2009 Directive, will provide legal clarity, it our view it will do anything but provide such clarity. There is enough “wriggle room” in the above wording to allow members of EWCs to argue that any proposed decision is transnational as any such decision could have an effect somewhere else at some time in the future. 

However, it should be possible, as with many existing EWC agreements, to write definitions of “transnational” using metrics and more precise criteria. Also, as we highlight elsewhere in this paper, if “exceptional circumstances” meetings are required because of the expanded definition of transnational, then the legislation provides for the use of virtual formats.

Article 2: “Information” and “Consultation”

(f)          ‘information’ means transmission of data by the employer to the employees’ representatives in order to enable them to acquaint themselves with the subject matter and to examine it;

(g)          ‘consultation’ means the establishment of dialogue and exchange of views between employees’ representatives and central management or any more appropriate level of management;

Comment

There is no change here. The wording deleted from the existing definitions of information and consultation has been moved to Article 9.

Article 5: SNB Gender Balance and Expenses

(b) The members of the special negotiating body shall be elected or appointed in proportion to the number of employees employed in each Member State by the Community-scale undertaking or Community-scale group of undertakings, by allocating in respect of each Member State one seat per portion of employees employed in that Member State amounting to 10 %, or a fraction thereof, of the number of employees employed in all the Member States taken together;

Any expenses relating to the negotiations referred to in paragraphs 3 and 4 shall be borne by the central management so as to enable the special negotiating body to carry out its task in an appropriate manner.

In compliance with this principle, Member States may lay down budgetary rules regarding the operation of the special negotiating body. They may in particular limit the funding to cover one expert only.

(b)         The members of the special negotiating body shall be elected or appointed in proportion to the number of employees employed in each Member State by the Community-scale undertaking or the Community-scale group of undertakings, in a manner that strives to achieve a gender-balanced representation, by allocating in respect of each Member State one seat per portion of employees employed in that Member State, amounting to 10 %, or a fraction thereof, of the number of employees employed in all the Member States taken together.

1. paragraph 6 is amended as follows:

•  in the first subparagraph, the following sentences are added:

“These expenses shall include reasonable costs of experts, including for legal assistance, insofar as necessary for that purpose, as well as reasonable costs of legal representation and participation in administrative or judicial proceedings. Expenses shall be notified to central management before they are incurred.

• (ii) in the second subparagraph, the second sentence is deleted (see opposite).

Comment

The attempt to achieve a greater gender balance on SNBs/EWCs is almost impossible to deliver on because many countries only have 1 member on either body. It is up to national rules to set out how SNB/EWC members are to be selected/elected. There is nothing management can or should do to influence this process. Otherwise, accusation of “interference” could be levelled. 

It may seem that issues to do with SNBs are of concern to a just a few undertakings, as there have been relatively few SNBs set up each year over the past few years. However, as will be seen later in this paper, a very significant number of undertakings which currently have Article 13 arrangements could be faced with SNBs if the Commission’s proposals to end the A13 exemption are accepted. The same could apply in some circumstances to Article 6 agreements. Therefore, rules around SNBs will become important.

The proposed wording on expert and legal costs is unhelpful. First, there is references to experts in the plural, whereas until now it has always been clear that SNBs were entitled to one expert. Second, at best there have only been one or two cases of SNBs going to court. Suggesting that SNBs need legal as well as expert advice seems superfluous. However, what is most concerning is that SNBs appear to be given the right to incur expert and legal costs at will. All they are required to do is to notify management in advance. Prior approval is not required.

It will be argued that SNBs can only incur “reasonable” costs. Who is to define what is reasonable? 

Unlike EWCs, (see later) where management will be able to agree on expert and legal resources as part of the negotiations for an EWC agreement, SNBs are only mandated to negotiate the terms of an EWC agreement. As things stand, negotiations on expert and legal resources would not fall within their remit. Further, arguing about these issues would be an unhelpful way to open the process.

Given these considerations, the budgetary rules to be laid down by Member States as regards SNBs will be of critical importance if unintended consequences are to be avoided.

There is also a risk that these rules could differ from Member State to Member State whereas up to now they have been standard across EU members.

Article 6: Content of the Agreement

Content of the agreement

1.   The central management and the special negotiating body must negotiate in a spirit of cooperation with a view to reaching an agreement on the detailed arrangements for implementing the information and consultation of employees provided for in Article 1(1).

2.   Without prejudice to the autonomy of the parties, the agreement referred to in paragraph 1 and effected in writing between the central management and the special negotiating body shall determine:

3.   The central management and the special negotiating body may decide, in writing, to establish one or more information and consultation procedures instead of a European Works Council.

The agreement must stipulate by what method the employees’ representatives shall have the right to meet to discuss the information conveyed to them.

This information shall relate in particular to transnational questions which significantly affect workers’ interests.

4.   The agreements referred to in paragraphs 2 and 3 shall not, unless provision is made otherwise therein, be subject to the subsidiary requirements of Annex I.

5.   For the purposes of concluding the agreements referred to in paragraphs 2 and 3, the special negotiating body shall act by a majority of its members.

1. paragraph 2 is amended as follows:

• (i) points (c) and (d) are replaced by the following:

“(c)  the functions and the procedure for information and consultation of the European Works Council and the arrangements for linking information and consultation of the European Works Council and national employee representation bodies, in accordance with the principles and requirements set out in Article 1(3) and Article 9;

(d)   the format, venue, frequency and duration of meetings of the European Works Council;

• (ii) point (f) is replaced by the following:

“(f)        the financial and material resources to be allocated to the European Works Council, including at least with respect to the following aspects:

• the possible use of experts, including legal experts, to assist the European Works Council in the discharge of its functions;
• legal representation and participation of the European Works Council, or of its members on its behalf, in administrative or judicial proceedings;
• the provision of relevant training to the members of the European Works Council, without prejudice to the minimum requirement in Article 10(4), first subparagraph;

The requirement to determine the elements listed in the first subparagraph, as amended by shall apply also with respect to European Works Council agreements concluded before [….].

Comment

The use of the word “format” when referring to meetings is specifically included to allow the parties to make use of remote technologies and to hold virtual meetings. This is to be welcomed.

This is the first time that Article 6 has specified the use of experts, including legal experts, by an EWC. Unlike an SNB (see above), the use of experts and legal advisors, and their costs, is subject to agreement with management. 

Management should make it clear that the use of experts is limited to assistance at meetings, including appropriate preparation time. The role of experts should be to advise on the information provided by management. EWCs should not be able to instruct experts/consultants to carry out studies or audits on their behalf. 

A similar approach should be taken to the use of legal advisors. Their role should be restricted to assisting at tribunal hearings, with appropriate preparation time, which should be limited to days, and not weeks.

If might be useful to consider giving the EWC a budget to cover expert and legal costs as one way of managing this issue.

If “experts” are to be included in agreements negotiated under Article 6 then it would be useful if a definition of “experts” was included in the definitions section of the Directive. Such a definition could be as follows:

An “expert” refers to a trade union official from a recognised trade union in an EU Member State, whether or not nominated by a European trade union federation, or a technical professional with an appropriate qualification as recognised under the laws of an EU Member State. A “legal expert” refers to a qualified legal practitioner as provided for in the laws of an EU Member State.

Article 7: Subsidiary Requirements (First meeting of SNB)

1.   In order to achieve the objective set out in Article 1(1), the subsidiary requirements laid down by the legislation of the Member State in which the central management is situated shall apply:

“—         where the first meeting of the special negotiating body is not convened within six months following a request pursuant to Article 5(1),

Comment

Based on our own experience, most managements have always worked to the understanding that the first meeting of the SNB should be held within six months, so this should not prove a problem. However, it might be wise to include a force majeure provision in case circumstances, such as Covid, prevent the first meeting being held within six months.

Article 8: Provision of information in Confidence

1.   Member States shall provide that members of special negotiating bodies or of European Works Councils and any experts who assist them are not authorized to reveal any information which has expressly been provided to them in confidence.

The same shall apply to employees’ representatives in the framework of an information and consultation procedure.

That obligation shall continue to apply, wherever the persons referred to in the first and second subparagraphs are, even after the expiry of their terms of office.

2.   Each Member State shall provide, in specific cases and under the conditions and limits laid down by national legislation, that the central management situated in its territory is not obliged to transmit information when its nature is such that, according to objective criteria, it would seriously harm the functioning of the undertakings concerned or would be prejudicial to them.

A Member State may make such dispensation subject to prior administrative or judicial authorisation.

3.   Each Member State may lay down particular provisions for the central management of undertakings in its territory which pursue directly and essentially the aim of ideological guidance with respect to information and the expression of opinions, on condition that, at the date of adoption of this Directive such particular provisions already exist in the national legislation.

1.           Member States shall provide that members of special negotiating bodies, members of European Works Councils or employees’ representatives in the framework of an information and consultation procedure, and any experts who assist them, are not authorised to reveal information which has expressly been provided to them in confidence by central management. In addition, central management may set up adequate information transmission and storage arrangements to help safeguard the confidentiality of information provided in confidence.

2.           Central management shall inform the members of the special negotiating bodies or the European Works Councils, or the employees’ representatives in the framework of an information and consultation procedure in a timely manner of the reasons justifying the provision of information in confidence in accordance with paragraph 1. 

3.           The obligation referred in paragraph 1 shall continue to apply, wherever the persons referred to in paragraph 1 are, even after the expiry of their terms of office, until, in agreement with central management, the justification provided is considered to have become obsolete.

Comment

See next comment (Art 8a)

Article 8a: Non-transmission of Information on Specific Grounds (New)

1.           Member States shall provide, in specific cases and under the conditions and limits laid down by national legislation, that the central management situated in its territory is not obliged to transmit information to members of special negotiating bodies or European Works Councils, or employees’ representatives in the framework of an information and consultation procedure, and any experts who assist them, when its nature is such that, according to objective criteria, it would seriously harm the functioning of the undertakings concerned. 

A Member State may make such dispensation subject to prior administrative or judicial authorisation. 

2.           Central management shall inform the members of the special negotiating bodies or the European Works Councils, or the employees’ representatives in the framework of an information and consultation procedure in a timely manner of the reasons justifying the non-transmission of information in accordance with paragraph 1.

Comment

Articles 8 and 8A do not, it seems to us, to not amount to major changes when it comes to the way management approaches confidential information. The reference to “adequate information transmission and storage arrangements” is helpful as this gives management greater security when it comes to the protection of confidential information. 

The change to note is that management needs to explain the reasons for saying information is confidential or for withholding information if asked to do so.

Article 9: Operation of the European Works Council and the information and consultation procedure for workers

Operation of the European Works Council and the information and consultation procedure for workers

The central management and the European Works Council shall work in a spirit of cooperation with due regard to their reciprocal rights and obligations.

The same shall apply to cooperation between the central management and employees’ representatives in the framework of an information and consultation procedure for workers.

1.           The central management and the European Works Council shall work in a spirit of cooperation with due regard to their reciprocal rights and obligations.

The same shall apply to cooperation between the central management and employees’ representatives in the framework of an information and consultation procedure for workers.

2.           Information on transnational matters shall be given at such time, in such fashion and with such content as are appropriate to enable employees’ representatives to undertake an in-depth assessment of their possible impact and, where appropriate, prepare for consultations with the competent organ of the Community-scale undertaking or Community-scale group of undertakings.

3.           Consultation shall take place at such time, in such fashion and with such content as it enables employees’ representatives to express an opinion prior to the adoption of the decision and based on the information provided in accordance with paragraph 2, without prejudice to the responsibilities of the management, and within a reasonable time taking into account the urgency of the matter. The employees’ representatives shall be entitled to a reasoned written response from the central management or any more appropriate level of management prior to the adoption of the decision on the measures in question, provided the employee representatives expressed their opinion within a reasonable time in accordance with the first sentence.

Comment

The wording on “information” is the same as is to be found in the current Directive, it is just in Article 9 instead of Article 1.

What is new in the wording on “consultation” is the right of the EWC to receive a “reasoned written response” to its opinion on the decision under consideration. What is welcome is that the response can be in writing and does not have to be delivered at a further meeting between management and the EWC.

However, those familiar with the day-to-day workings of EWCs will be uneasy with the implicit suggestion that the EWC information and consultation process only closes when management gives its reasoned response to the EWC opinion. This invites delay on the part of an EWC unhappy with the proposed decision even if there are references to “without prejudice to responsibilities of management” and to the opinion being delivered within a “reasonable time”. It may be possible to define “reasonable time” within the EWC agreement but that is not guaranteed. The suggested wording opens the door to claims that local information and consultation cannot be concluded until the EWC process is completed by the opinion/response requirement.

What would be helpful if the following sentence were to be added: “EWC consultation will be conducted in full respect of the autonomy of information and consultation procedures as provided for in national law and practice”. While it can be argued that this is already provided for in the Directive, in our view it would be best to spell it out to avoid disputes.

Article 10: Role and protection of employees’ representatives

1.   Without prejudice to the competence of other bodies or organisations in this respect, the members of the European Works Council shall have the means required to apply the rights arising from this Directive, to represent collectively the interests of the employees of the Community-scale undertaking or Community-scale group of undertakings.

2.   Without prejudice to Article 8, the members of the European Works Council shall inform the representatives of the employees of the establishments or of the undertakings of a Community-scale group of undertakings or, in the absence of representatives, the workforce as a whole, of the content and outcome of the information and consultation procedure carried out in accordance with this Directive.

3.   Members of special negotiating bodies, members of European Works Councils and employees’ representatives exercising their functions under the procedure referred to in Article 6(3) shall, in the exercise of their functions, enjoy protection and guarantees similar to those provided for employees’ representatives by the national legislation and/or practice in force in their country of employment.

This shall apply in particular to attendance at meetings of special negotiating bodies or European Works Councils or any other meetings within the framework of the agreement referred to in Article 6(3), and the payment of wages for members who are on the staff of the Community-scale undertaking or the Community-scale group of undertakings for the period of absence necessary for the performance of their duties.

4.   In so far as this is necessary for the exercise of their representative duties in an international environment, the members of the special negotiating body and of the European Works Council shall be provided with training without loss of wages.

1. Without prejudice to the competence of other bodies or organisations in this respect, the employees’ representatives, including the members of the special negotiating body and the members of the European Works Council, shall have the means required to apply the rights arising from this Directive, to represent collectively the interests of the employees of the Community-scale undertaking or Community-scale group of undertakings.

2.           Without prejudice to Articles 8 and 8a, the members of the European Works Council shall have the right and necessary means to inform the representatives of the employees of the establishments or of the undertakings of a Community-scale group of undertakings or, in the absence of representatives, the workforce as a whole, of the content and outcome of the information and consultation procedure, in particular before and after the meetings with the central management.

3.           Members of special negotiating bodies, members of European Works Councils and employees’ representatives exercising their functions under the procedure referred to in Article 6(3) shall, in the exercise of their functions, enjoy protection and guarantees equivalent to those provided for employees’ representatives by the national legislation and practice in force in their country of employment.

This shall apply in particular to attendance at meetings of special negotiating bodies or European Works Councils or any other meetings within the framework of the agreement referred to in Article 6(3), the payment of wages for members who are on the staff of the Community-scale undertaking or the Community-scale group of undertakings for the period of absence necessary for the performance of their duties, and protection against retaliatory measures or dismissal.

4.           In so far as this is necessary for the exercise of their representative duties in an international environment, the members of the special negotiating body and of the European Works Council shall be provided with training without loss of wages.

Without prejudice to agreements concluded pursuant to Article 6(2), point (f), the costs of such training and related expenses shall be borne by the central management, provided that the central management has been informed in advance.

Comment

There are two issues of concern here.

First, paragraph 2, about reporting to the workforce “before and after” any meeting with management. EWC members are to have the “rights and necessary means” to do so. Such words are easy to write. Much more difficult to make a reality. 

It is easy enough to report to a works council, union or other employee representative body. EWC members from countries with such bodies are generally members of them, often their chair.

But what about the multitude of sites, probably the majority across Europe, with no such bodies? How are EWC members supposed to report to them? And it is the EWC members that have to report. This is not something can be delegated to others. Site visits? Even if feasible, and they aren’t, to whom is the EWC member to talk? Stop the whole site for a general meeting? Unrealistic. 

It would be better if, like training, how communications between the EWC and the workforce was something to be negotiated in the EWC agreement and a reference to it included in Article 6. Further, it must be made clear that electronic means of communications, such as emails and webpages, can be used. 

The second issue of concern relates to Paragraph 4 on training. The right to training is not contested. Indeed, it is well established. How training is to be provided and the scope of such training is to be included in the EWC agreement negotiated under Article 6 (see earlier). However, the last sentence in Paragraph 4 is problematic. It seems to suggest a unilateral right on the part of EWC members, either collectively or individually, to book training and simply inform management of the cost beforehand. While the training must be necessary “for the exercise of their duties in an international environment” this will always be a disputable matter, especially in circumstances where consultants who act as experts also “sell” training and advise that it is necessary.

Given that the costs associated with training can be significant, travel, accommodation, interpretation and translation, trainer fees, prior management approval must be required. It would be better if the last sentence in Paragraph 4 was deleted, leaving the rest of the paragraph stating the right to training and leaving issues around the delivery of training to be dealt with in the agreement under Article 6. 

Article 11: Judicial Procedures and Penalties

1.   Each Member State shall ensure that the management of establishments of a Community-scale undertaking and the management of undertakings which form part of a Community-scale group of undertakings which are situated within its territory and their employees’ representatives or, as the case may be, employees abide by the obligations laid down by this Directive, regardless of whether or not the central management is situated within its territory.

2.   Member States shall provide for appropriate measures in the event of failure to comply with this Directive; in particular, they shall ensure that adequate administrative or judicial procedures are available to enable the obligations deriving from this Directive to be enforced.

3.   Where Member States apply Article 8, they shall make provision for administrative or judicial appeal procedures which the employees’ representatives may initiate when the central management requires confidentiality or does not give information in accordance with that Article.

Such procedures may include procedures designed to protect the confidentiality of the information in question.

2.           Member States shall provide for appropriate measures in the event of failure to comply with the national provisions adopted pursuant to this Directive. In particular, they shall ensure that:

(a)          adequate procedures are available to enable the rights and obligations deriving from this Directive to be enforced in a timely and effective manner;

(b)         penalties that are effective, dissuasive and proportionate are applicable in cases of infringement of the rights and obligations arising from this Directive.

In the event of failure to comply with the national provisions transposing the obligations under Article 9(2) and (3), Member States shall provide for pecuniary sanctions, to be determined considering the criteria listed in the third subparagraph of this paragraph, without prejudice to the possibility to provide for other types of sanctions in addition. 

For the purposes of point (b), of the first subparagraph, Member States shall take into consideration, when determining penalties, the gravity, duration, consequences, and the intentional or negligent nature of the offence, and in respect of pecuniary sanctions, also the size and financial situation of the sanctioned undertaking or group, and any other relevant criteria.

1. paragraph 3 is amended as follows:

• (i) the first subparagraph is replaced by the following:

“3.      Member States shall make provision for administrative or judicial appeal procedures which the members of the special negotiating body, European Works Council members or employees’ representatives may initiate when the central management provides information in confidence in accordance with Article 8 or does not transmit information on specific grounds in accordance with Article 8a.”;

• (ii) the following subparagraph is added:

“The duration of such procedures shall be compatible with the effective exercise of the information and consultation rights under this Directive.”;

1. the following paragraph 4 is added:

“4.      Where Member States make access to judicial proceedings conditional upon the prior implementation of an alternative dispute resolution, that procedure shall neither result in a decision which is binding on the parties concerned, nor otherwise prejudice their right to bring legal proceedings.

Comment

What is being proposed in this Article is that Member States stiffen the financial penalties for breach of EWC obligations, and such penalties should take into account the size and turnover of the undertakings involved. The demand from the European Parliament that the penalties should equal those under the GDPR, 4% of global turnover, has not been included. This was to be expected because, at worse, undertakings at fault have breached a procedure that results in a non-binding opinion. GDPR size fines would have been out of all proportion to the issues at stake.

The reference to penalties taking into account “the intentional or negligent nature of the offence” is to be welcomed. In our experiences, most of the disputes that have arisen between EWCs and management have been over matters of interpretation of either agreements or the legislation. Fining management for misinterpretation is inappropriate, especially as EWCs run no risk if their interpretation is found to be faulty, as has often been the case. In cases of disputed interpretation, guidance from the court as to the correct interpretation rather than the imposition of fines would be more appropriate. Financial penalties should be restricted to cases where the abuse of the process has been “intentional or negligent”. 

The proposals make reference to “alternative dispute resolution” before judicial procedures can be invoked. It is made clear that such dispute resolution mechanisms cannot prevent an issues being referred to a court or a tribunal. In our view, it would be better is such mediation processes were made mandatory to give the parties, with expert facilitation, an opportunity to find a negotiated solution to the issue in dispute. Nonetheless, the reference to the use of such procedures could act as a signal to Member States to consider the use of such mechanism if they are not already provided for.

Article 12: Link Between European and National Information and Consultation

1.   Information and consultation of the European Works Council shall be linked to those of the national employee representation bodies, with due regard to the competences and areas of action of each and to the principles set out in Article 1(3).

2.   The arrangements for the links between the information and consultation of the European Works Council and national employee representation bodies shall be established by the agreement referred to in Article 6. That agreement shall be without prejudice to the provisions of national law and/or practice on the information and consultation of employees.

3.   Where no such arrangements have been defined by agreement, the Member States shall ensure that the processes of informing and consulting are conducted in the European Works Council as well as in the national employee representation bodies in cases where decisions likely to lead to substantial changes in work organisation or contractual relations are envisaged.

4.   This Directive shall be without prejudice to the information and consultation procedures referred to in Directive 2002/14/EC and to the specific procedures referred to in Article 2 of Directive 98/59/EC and Article 7 of Directive 2001/23/EC.

5.   Implementation of this Directive shall not be sufficient grounds for any regression in relation to the situation which already prevails in each Member State and in relation to the general level of protection of workers in the areas to which it applies.

 6.           Each Member State may lay down particular provisions for the central management of undertakings in its territory which pursue directly and essentially the aim of ideological guidance with respect to information and the expression of opinions, on condition that, at the date of adoption of this Directive such particular provisions already exist in the national legislation.

Comment

This is not an issue that will be of concern to our member companies.

Article 13: Adaptation

Where the structure of the Community-scale undertaking or Community-scale group of undertakings changes significantly, and either in the absence of provisions established by the agreements in force or in the event of conflicts between the relevant provisions of two or more applicable agreements, the central management shall initiate the negotiations referred to in Article 5 on its own initiative or at the written request of at least 100 employees or their representatives in at least two undertakings or establishments in at least two different Member States.

At least three members of the existing European Works Council or of each of the existing European Works Councils shall be members of the special negotiating body, in addition to the members elected or appointed pursuant to Article 5(2).

During the negotiations, the existing European Works Council(s) shall continue to operate in accordance with any arrangements adapted by agreement between the members of the European Works Council(s) and the central management.

Comment

There are no changes proposed to this article, but we include it for ease of reference because paragraphs 2 and 3 are mention in the new Article 14a – see below.

Article 14: Pre-existing Agreements – “Article 13 Agreements” (Deleted)

Agreements in force

1.   Without prejudice to Article 13, the obligations arising from this Directive shall not apply to Community-scale undertakings or Community-scale groups of undertakings in which, either

The national law applicable when the agreement is signed or revised shall continue to apply to the undertakings or groups of undertakings referred to in point (b) of the first subparagraph.

2.   Upon expiry of the agreements referred to in paragraph 1, the parties to those agreements may decide jointly to renew or revise them. Where this is not the case, the provisions of this Directive shall apply.

Comment

The deletion of Article 14 from the 2009 Directive, Article 13, in the original 1994 Directive, means that the estimated 360 or so undertakings with “pre-existing agreements” in place before September 1996, can no longer use such arrangements to block requests to set up Special Negotiating Bodies (SNBs) to negotiate the establishment of a European Works Council within the framework of the Directive. After the rewritten Directive is transposed into national law, one year after it is agreed, then 100 employees, or their representatives can submit a SNB request. The management will be obliged to set up the SNB and meet with it for the first time within six months, or else the Subsidiary Requirements will apply.

The SNB request can be submitted without having to take the views of the existing information and consultation body into consideration. This seems somewhat unfair as existing arrangements may be working to everyone’s satisfaction. While it is our view that the existing exemption should be left in place, if the legislators want a procedure to allow for A13 arrangements to be brought to an end, then not only should the process require an SNB request as provided for in Article 5, but it should also require that the request be endorsed by a two-thirds majority of the existing information and consultation body. If it is not endorsed, a further SNB request should be blocked for four years,

Under Article 5 of the Directive, if an SNB is established, then by a two-thirds majority the members of the SNB can vote not to open negotiations or to discontinue negotiations once opened. In such circumstances, the Subsidiary Requirements do not apply and a further SNB request cannot be submitted for at least two years. Were the proposal by us put forward in the preceding paragraph to be adopted, this would go a long way to avoiding this eventuality as the majority of SNB members would likely be existing European information and consultation body members who had already voted to endorse the request to open negotiations.

Alternatively, once established the SNB could endorse the existing arrangements as an “information and consultation procedure” as provided for by the Directive, but this would probably require some change to whatever existing texts/agreements there might be. 

In any event, A13 information and consultation bodies will be able to continue to meet while the SNB negotiations take place.  It could also be that A13 agreements continue to be legally binding in and of themselves, depending on the wording in the agreement. Matters could become complicated.

Article 14a: Transitional Provisions – Need to Renegotiate (New)

1.           Where, following the transposition of [OP: insert reference to this amending Directive], a European Works Council agreement or agreement on an information and consultation procedure concluded before [OP: insert date from which the transposing provisions are to apply, set out in the Article 2(1), 2nd subpar. of this amending Directive] in accordance with Articles 5 and 6 of Directive 94/45/EC or Articles 5 and 6 of this Directive is not in conformity with any of the requirements applicable to that agreement as a consequence of the amendments provided for in [OP: insert reference to this amending Directive], central management shall initiate negotiations to adapt that agreement at the written request of at least 100 employees or their representatives in at least two undertakings or establishments in at least two different Member States. Central management may also initiate such negotiations on its own initiative.

2.           Where the European Works Council agreement or agreement on an information and consultation procedure contains procedural arrangements for its adaptation or renegotiation, the adaptation may be negotiated pursuant to those arrangements. Otherwise, the adaptation shall follow the procedure set out in Article 5 in conjunction with Article 13, second and third paragraphs.

3.           Where an adaptation procedure does not lead to an agreement within two years from the date of the respective request by employees or their representatives, the subsidiary requirements set out in Annex I shall apply.

Comment

14a applies to all existing Article 6 agreements, whether negotiated under the original 1994 Directive or the 2009 Directive, as transposed into the governing national law. Once the rewritten Directive is agreed and transposed into national law, then undertakings with A6 agreements will have two years to bring these agreements into line with the provisions of the new Directive. If the A6 agreement has a “renegotiation” procedure, then that procedure can be used for this renegotiation. If the A6 agreement has no such procedure, then an SNB is to be established, in accordance with the Provisions of Articles 5 and 13 (see above) to negotiate a revised agreement. Whether an “internal renegotiation procedure” or an SNB is used, if no agreement is reached within two years, the Subsidiary Requirements apply.

Transposition

1.   Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with Article 1(2), (3) and (4), Article 2(1), points (f) and (g), Articles 3(4), Article 4(4), Article 5(2), points (b) and (c), Article 5(4), Article 6(2), points (b), (c), (e) and (g), and Articles 10, 12, 13 and 14, as well as Annex I, point 1(a), (c) and (d) and points 2 and 3, no later than 5 June 2011 or shall ensure that management and labour introduce on that date the required provisions by way of agreement, the Member States being obliged to take all necessary steps enabling them at all times to guarantee the results imposed by this Directive.

When Member States adopt those provisions, they shall contain a reference to this Directive or be accompanied by such a reference on the occasion of their official publication. They shall also include a statement that references in existing laws, regulations and administrative provisions to the directive repealed by this Directive shall be construed as references to this Directive. Member States shall determine how such reference is to be made and how that statement is to be formulated.

2.   Member States shall communicate to the Commission the text of the main provisions of national law which they adopt in the field covered by this Directive.

Member States shall adopt and publish, by [OP: insert date one year from the entry into force of this Directive] at the latest, the laws, regulations and administrative provisions necessary to comply with this Directive. They shall forthwith communicate to the Commission the text of those provisions.

They shall apply those provisions from [OP: insert date two years from the date set out in the first subparagraph].

When Member States adopt those provisions, they shall contain a reference to this Directive or be accompanied by such a reference on the occasion of their official publication. Member States shall determine how such reference is to be made.

2.              Member States shall communicate to the Commission the text of the main provisions of national law which they adopt in the field covered by this Directive.

Regarding the amendments provided for in Article 1, point 8, of this Directive, Member States shall notify the Commission by [OP: insert date in the first subparagraph of paragraph 1] of the means by which the European Works Councils, the special negotiating bodies, and employees’ representatives can, in accordance with Article 11(2), (3) and (4) of Directive 2009/38/EC, as amended, bring judicial proceedings, and where applicable, administrative proceedings, in respect of all the rights under this Directive

Comment

What is interesting here is that Member States will be required to make available to the Commission a “complete package” of not only the transposing law, but also any associated regulations and procedures necessary to give effect to the provisions of the Directive. One could be forgiven for thinking that this is the Commission taking steps to ensure that another “Ireland” situation does not occur. Close on thirty years after the original Directive was transposed into Irish law, associated regulations still have not been published and the relevant government department persists with the fiction that Irish EWC legislation is in conformity. Everything will now need to be in place as part of the transposition into national law.

EWC Directive - Subsidiary Requirements

Comparison Between Existing text and Proposed Text

Existing Text

Proposed Text

Disclaimer:  Th analysis offered in this commentary is that of the author. The information provided does not constitute legal advice. Readers should contact their legal advisers to obtain advice with respect to specific issues, queries, or disputes