European Works Council Directive Recast

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By Allen Smith Jan 1, 2009

HR Magazine, January 2009In addition to the local works council requirements of most European Union (EU) countries, large companies must comply with the European Works Council (EWC) Directive. On Dec. 16, 2008, the European Parliament announced that it had adopted a revision of the EWC directive.

First adopted on Sept. 22, 1994, the EWC directive mandates that large companies inform and consult with works councils on company decisions at the EU level through their EWC representatives. The directive applies to all companies with 1,000 or more workers and at least 150 employees in each of two or more EU countries. Employees must petition the employers to create EWCs.

Conversations in compliance with national works councils laws and the EU Works Council directive often “run in parallel,” notes Christopher Walter, who heads Paul Hastings’ employment law practice in London.

The European Trade Union Confederation (ETUC) estimates that of the 2,264 companies covered by the directive, approximately 828 have EWCs in operation, representing 14.5 million workers across Europe.

Critics of the directive say it is little more than a paper tiger as there are few penalties for companies that defy it. The ETUC called for tougher sanctions and updating of the directive with a lower threshold on the size of companies covered and clearer definition of information and consultation.

The recent amendments state that information transmitted from employer to employees’ representatives must be “given at such a time, in such a fashion” to enable employees’ representatives “to undertake an in-depth assessment of the possible impact and, where appropriate, prepare consultations with the competent body of the community-scale undertaking or community-scale group of undertakings in question.” In addition, the threshold of 50 employees for setting up special negotiating bodies as a first step to constituting European works councils was abolished.

Unite, the biggest union in the United Kingdom, welcomed the revision. But Tony Burke, Unite’s assistant general secretary, said, “We are disappointed that the UK government has not taken a proactive approach during this process and is again out of step with the rest of Europe. This is an important step in improving the right to information and consultation.” Unite said that the revision provides the right to time off with pay for training, a more detailed definition of transnational issues and for the purposes of negotiations the inclusion of the competent recognized trade union organization.

Member states have two years to implement the changes into their national laws.


Allen Smith is SHRM’s manager of workplace law content.

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