Strengthening representation of EU workers in multinational companies: Council agrees its position on the European works council directive
The Council has agreed its negotiating position (‘general approach’) on a new directive that seeks to make the representation of workers in large multinational companies more effective. The European Works Council Directive will amend the existing directive on European Works Councils (EWCs), making them easier to set up, better funded and better protected.
Current exemptions from the application of the directive will no longer apply, meaning that all relevant companies will be subject to the same rules when it comes to informing and consulting employees.
“As one of the key principles of the European Pillar of Social Rights, the right of workers to be consulted on issues that are relevant to them lies at the heart of the Belgian presidency’s priorities. I am confident that the negotiating position agreed on today will help ensure that employees of large multinational companies in the EU can have a say in the decisions that affect them.”
Pierre-Yves Dermagne, Belgian Deputy Prime Minister and Minister of the Economy and Employment
Aim of the new directive
EWCs represent European workers in large multinational companies that operate in at least two EU or European Economic Area (EEA) countries. They are the main instrument for informing and consulting employees on planned decisions relating to transnational issues.
The new directive seeks to make the law governing EWCs clearer, more effective and easier to enforce, including a clearer definition of transnational matters, more robust rules for setting up an EWC, and clearer and more stringent requirements in cases where a company refuses to provide access to information, or insists that the information be treated as confidential. EWCs will also be guaranteed effective access to judicial proceedings to enforce their rights.
Other proposed changes include clarifications of the costs to be borne for EWCs by the company, greater gender balance among EWC representatives, and a requirement for companies to consult EWCs in a timely manner to make the information and consultation procedure of the EWC more effective, including by providing the EWC with a written response before a decision is taken.
The Council’s negotiating position
In its general approach, the Council:
- notes that the obligation to strive for gender-balanced membership of EWCs should not prejudice national laws and practices on electing and appointing employees’ representatives
- stresses that EWCs should be given sufficient time to express their views ahead of any decision that might affect them, while also taking into account the urgency of the matter and ensuring that companies are not prevented from adopting decisions in cases where an EWC has not provided its opinion within a reasonable time
- strengthens provisions on access to judicial proceedings and (where relevant) administrative proceedings, including by ensuring that costs relating to legal representation and participation are covered
- streamlines the rules on penalties while maintaining the list of factors that can be taken into consideration when determining penalties, such as the size and financial situation of the company, the gravity of the offence, and whether the offence was intentional or negligent
- clarifies that information can only be required to be withheld or treated as confidential for as long as the reasons justifying these limitations persist
Next steps
Once the European Parliament has agreed on its mandate, negotiations will begin between the two co-legislators with a view to reaching an agreement on the directive. The new rules will then be adopted following legal-linguistic revision, and member states shall transpose the provisions of the directive into national law within two years of its entry into force. They shall apply the provisions of the directive at the latest four years after its entry into force.
Background
EWCs are information and consultation bodies that represent European workers in multinational companies with more than 1 000 employees operating in at least two EU or European Economic Area (EEA) countries.
On 24 January 2024 the Commission presented a proposal for a directive amending Directive 2009/38/EC as regards the establishment and functioning of EWCs and the effective enforcement of transnational information and consultation rights. The aim of the directive is to tackle shortcomings in the existing legislation on EWCs with a view to improving the effectiveness of the framework for the information and consultation of employees at transnational level.
