Overview
works council
Quick Reference
A representative body of employees within a single workplace or enterprise which in most European countries has legal status and cannot be avoided or dissolved by employers. Works councils have long been an important part of the industrial relations system in Germany, the Netherlands, France, Spain, Italy, and other European countries. As a result of the information and consultation directive of 2002, there is now a requirement on all member states of the European Union to establish works councils, a measure that has been particularly significant for Ireland and the UK which previously lacked legislation of this kind. Moreover, in large, multinational companies operating in the European Union, there is a requirement to establish a European works council under EU law. Works councils are not mandatory but must be established in companies above a certain size at the request either of the workforce or, in some cases, of trade unions. Works councillors are elected from amongst employees, following procedures laid down in national legislation, and in most systems, trade unions are allowed to nominate candidates and may provide support to works councillors once they have been elected. The rights, obligations, and activities of works councils are highly variable but there are common themes. In most countries, there is a duty to cooperate with the employer and works councils are generally prohibited in law from organizing industrial action. As an alternative, they have the right to legal redress through the courts when they believe their rights have been infringed. In return for accepting a peace obligation, works councils have rights to information, consultation, and, in Germany and the Netherlands, codetermination. Generally, the rights of works councils are stronger in the areas of employee welfare and personnel management and weaker with regard to business policy, technical change, and company finance. A key issue that arises in systems of industrial relations based on works councils is their relationship to trade unions and collective bargaining. In countries like Germany, there has been a traditional division of labour between adversarial collective bargaining over pay and hours of work at industry level and more cooperative relations at enterprise level between works councils and single employers. In most large German companies, however, works councils are effectively ‘captured’ by trade unions, whose candidates are usually elected to works council positions. Moreover, with the decentralization of bargaining in Germany, works councils have assumed responsibility for bargaining on issues such as working time where industry-wide framework agreements allow them to do so. Works councils are forbidden in law, however, to contravene the terms of collective contracts negotiated by trade unions. Works councils should not be confused with systems of worker directors (rather confusingly also known as codetermination in Germany), though these two systems of worker participation often function alongside one another, with senior works councillors occupying positions on the supervisory boards of large European companies. [See Information and Consultation of Employees (ICE) Regulations.]
