Proposal for a Council Directive establishing a general framework for informing and consulting employees in the European Community (1999/C 2/03) (Text with EEA relevance) COM(1998) 612 final - 98/0315(SYN)

(Submitted by the Commission on 17 November 1998)

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Agreement on Social Policy attached to the Protocol (No 14) on Social Policy annexed to the Treaty establishing the European Community, and in particular Article 2(2) thereof,

Having regard to the proposal from the Commission,

Having regard to the opinion of the Economic and Social Committee,

Acting in accordance with the procedure referred to in Article 189c,

Whereas, on the basis of the Protocol on Social Policy annexed to the Treaty establishing the European Community, and with the exception of the United Kingdom of Great Britain and Northern Ireland, the Member States of the European Community, hereinafter referred to as the 'Member States`, desirous of implementing the Social Charter of 1989, have adopted an Agreement on Social Policy;

Whereas Article 2(2) of the said Agreement authorises the Council to adopt minimum requirements by means of directives;

Whereas, pursuant to Article 1 of the Agreement, a particular objective of the Community and the Member States is to promote social dialogue between management and labour;

Whereas point 17 of the Community Charter of Fundamental Social Rights of Workers provides, inter alia, that 'information, consultation and participation for workers must be developed among appropriate lines, taking account of the practices in force in different Member States`;

Whereas the Commission, pursuant to Article 3(2) of the Agreement on Social Policy, has consulted management and labour at Community level on the possible direction of Community action on the information and consultation of workers in undertakings within the European Union;

Whereas the Commission, considering after this consultation that Community action was advisable, has again consulted the social partners on the content of the planned proposal, pursuant to Article 3(3) of the said Agreement, and the social partners have presented their opinions to the Commission;

Whereas, having completed this second stage of consultation, the social partners have not informed the Commission of their wish to initiate the process potentially leading to the conclusion of an agreement, as provided for in Article 4 of the said Agreement;

Whereas the existence of legal frameworks at national and Community level intended to ensure that workers are involved in the affairs of the undertaking employing them and in decisions which affect them has not always prevented serious decisions affecting workers from being taken and made public without adequate procedures having been implemented beforehand to inform and consult them;

Whereas there is a need to strengthen dialogue and promote mutual trust within undertakings in order to improve risk anticipation, make work organisation more flexible and facilitate employee access to training within the undertaking while maintaining security, make employees aware of adaptation needs, increase employees' availability to undertake measures and activities to increase their employability, promote employee involvement in the operation and future of the undertaking and increase its competitiveness;

Whereas timely information and consultation is a prerequisite for the success of restructuring and adaptation of undertakings to the new conditions created by globalisation of the economy, particularly via the development of new forms of work organisation;

Whereas the European Community has drawn up and implemented an employment strategy based on the concepts of 'anticipation`, 'prevention` and 'employability`, which are to be incorporated as key elements into all public policies likely to benefit employment, including the policies of individual undertakings, by strengthening the social dialogue with a view to promoting change compatible with preserving the priority objective of employment;

Whereas further development of the Internal Market must be properly balanced, maintaining the essential values on which our societies are based and ensuring that all citizens benefit from economic development;

Whereas the third stage of economic and monetary union will extend and accelerate the competitive pressures at European level; whereas this will mean that more supportive measures are needed at national level;

Whereas the existing legal frameworks for employee information and consultation at Community and national level tend to adopt an excessively a posteriori approach to the process of change, neglect the economic aspects of decisions taken and do not contribute to genuine anticipation of employment developments within the undertaking or to risk prevention;

Whereas, as a result of all these political, economic, social and legal developments, action is needed at Community level to make the essential changes to the existing legal framework;

Whereas, in accordance with the principles of subsidiarity and proportionality as set out in Article 3b of the Treaty, the objectives of the proposed action, as outlined above, cannot be adequately achieved by the Member States, in that the object is to establish a framework for employee information and consultation appropriate for the new European context described above; but whereas, in view of the scale and impact of the proposed action, these objectives can be better achieved at Community level by the introduction of minimum regulations applicable to the entire European Community, and whereas the present Directive constitutes no more than minimum necessary to achieve these objectives;

Whereas the purpose of this general framework is to establish minimum requirements applicable throughout the European Community while avoiding any administrative, financial or legal constraints which would hinder the creation and development of small and medium-sized undertakings; whereas, to this end, the scope of this Directive should be restricted to undertakings with at least 50 employees, without prejudice to any more favourable national or Community provisions; whereas, in order to maintain the appropriate balance between the abovementioned factors, this minimum may be raised to 100 employees in the case of the more innovative measures proposed herein on the information and consultation of employees on developments in the employment situation within the undertaking;

Whereas a Community framework for informing and consulting employees must keep to a minimum the burden on businesses while ensuring the effective exercise by employees of their rights;

Whereas the objectives of this Directive are to be achieved through the establishment of a general framework comprising the definitions and purpose of the information and consultation, which it will be up to the Member States to complete and adapt to their own national situation, ensuring, where appropriate, that the social partners have a leading role by allowing them to define freely the arrangements for informing and consulting employees which they consider to be best suited to their needs and wishes;

Whereas care must be taken to avoid affecting some specific rules in the field of employees' information and consultation existing in some national laws, addressed to undertakings which pursue political, professional organisation, religious, charitable, educational, scientific or artistic aims, as well as aims involving information and the expression of opinions;

Whereas undertakings must be protected against public disclosure of certain particularly sensitive information;

Whereas modernisation of work implies both rights and obligations for the two social partners at undertaking level;

Whereas a reinforced and dissuasive sanction, applicable in the case of decisions taken in serious breach of the obligations under this Directive must be established at Community level, without prejudice to the general obligations of Member States in this respect;

Whereas this Directive also applies to the subjects covered by Council Directive 98/59/EC of 20 July 1998 on the approximation of the laws of the Member States relating to collective redundancies (1) and Council Directive 77/187/EEC of 14 February 1998 on the approximation of the laws of the Member States relating to the safeguarding of employees' rights in the event of transfers of undertakings, businesses or parts of businesses, amended by the Council Directive 98/50/EC of 29 June 1998 (2);

Whereas other employee information and consultation rights, including those arising from Council Directive 94/45/EEC of 22 September 1994 on the establishment of a European Works Council or a procedure in Community-scale undertakings and Community-scale groups of undertakings for the purposes of informing and consulting employees (3), must not be affected by this Directive,

HAS ADOPTED THIS DIRECTIVE:

Article 1

Object and principles

1. The purpose of this Directive is to establish a general framework for informing and consulting employees in undertakings within the European Community.

2. When defining or implementing information and consultation procedures, the employer and the employees' representatives shall work in a spirit of cooperation and with due regard for their reciprocal rights and obligations, taking into account the interests both of the undertaking and of the employees.

Article 2

Definitions and scope

1. For the purposes of this Directive:

(a) 'undertakings` means public or private undertakings carrying out an economic activity, whether or not operating for gain, which are located within the territory of the Member States of the European Community and have at least 50 employees, without prejudice to the provisions of Article 4(3);

(b) 'employer` means the natural or legal person party to employment contracts or employment relationships with employees;

(c) 'employees` representatives' means the employees' representatives provided for by national laws and/or practices;

(d) 'information` means transmission by the employer to the employees' representatives of information containing all relevant facts on the subjects set down in Article 4(1), ensuring that the timing, means of communication and content of the information are such as to ensure its effectiveness, particularly in enabling the employees' representatives to examine the information thoroughly and, where appropriate, prepare consultations;

(e) 'consultation` means the organisation of a dialogue and exchange of views between the employer and the employees' representatives on the subjects set out in Article 4(1)(b) and (c),

- ensuring that the timing, method and content are such that this step is effective;

- at the appropriate level of management and representation, depending on the subject under discussion;

- on the basis of the relevant information to be supplied by the employer and the opinion which the employees' representatives are entitled to formulate;

- including the employees' representatives' right to meet with the employer and obtain a response, and the reasons for that response, to any opinion they may formulate;

- including, in the case of decisions within the scope of the employer's management powers, an attempt to seek prior agreement on the decisions referred to in Article 4(1)(c).

2. In conformity with the principles and objectives of this Directive, Member States may lay down particular provisions applicable to undertakings which pursue directly and essentially political, professional organisation, religious, charitable, education, scientific or artistic aims, as well as aims involving information and the expression of opinions, on condition that, at the date of adoption of this Directive, such particular provisions already exist in national legislation.

Article 3

Information and consultation procedures deriving from an agreement

1. Member States may authorise the social partners at the appropriate level, including at undertaking level, to define freely and at any time through negotiated agreement the procedures for implementing the employee information and consultation requirements referred to in Articles 1, 2 and 4 of this Directive.

2. The agreements referred to in paragraph 1 may establish, while respecting the general objectives laid down by the Directive and subject to conditions and limitations laid down by the Member States, arrangements which are different to those referred to in Article 2(1)(d) and (e) and Article 4 of the present Directive.

Article 4

Content of, and procedures for, information and consultation

1. Without prejudice to any provisions and/or practices more favourable to employees in force in the Member States, employee information and consultation shall, if there is no agreement between the social partners as envisaged in Article 3, cover:

(a) information on the recent as well as the reasonably foreseeable development of the undertaking's activities and its economic and financial situation;

(b) information and consultation on the situation, structure and reasonably foreseeable developments of employment within the undertaking and, where the employer's evaluation suggests that employment within the undertaking may be under threat, the anticipatory measures envisaged, in particular for employee training and skill development, with a view to offsetting the potential negative developments or their consequences and increasing the employability of the employees likely to be affected;

(c) information and consultation on decisions likely to lead to substantial changes in work organisation or in contractual relations, including those covered by the Community provisions referred to in Article 8(1).

2. The Member States shall ensure that information and consultation are effective and useful within the meaning of Article 1 and Article 2(1)(d) and (e). To this end, they shall determine the information and consultation procedures for the subjects listed in paragraph 1.

3. Member States may exclude from the information and consultation obligations referred to in paragraph 1(b) of this Article undertakings with fewer than 100 employees.

Article 5

Confidential information

1. Member States shall provide that the employees' representatives and any experts who assist them are not authorised to disclose any information which has expressly been provided to them in confidence. This obligation shall continue to apply irrespective of where the said representatives or experts are, even after expiry of their term of office.

2. Member States shall provide, in specific cases and within the conditions and limits laid down by national legislation, that the employer is not obliged to communicate information or undertake consultation when the nature of that information or consultation is such that, according to objective criteria, it would seriously harm the functioning of the undertaking or would be prejudicial to it.

Article 6

Protection of employees' representatives

Employees' representatives shall, when carrying out their functions, enjoy adequate protection and guarantees to enable them to perform properly the duties which have been assigned to them.

Article 7

Protection of rights

1. Member States shall provide for appropriate measures in the event of non-compliance with this Directive by the employer or the employees' representatives; in particular, they shall ensure that adequate administrative or judicial procedures are available to enable the obligations deriving from this Directive to be enforced, including procedures which may be instituted by the employer or the employees' representatives where either party considers that the other party is in breach of the obligations provided for in Article 5.

2. Member States shall provide for adequate penalties to be applicable in the event of infringement of this Directive by the employer or the employees' representatives. These penalties must be effective, proportionate and dissuasive.

3. Member States shall provide that in case of serious breach by the employer of the information and consultation obligations in respect of the decisions referred to in Article 4(1)(c) of this Directive, where such decisions would have direct and immediate consequences in terms of substantial change or termination of the employment contracts or employment relations, these decisions shall have no legal effect on the employment contracts or employment relationships of the employees affected. The non production of legal effects will continue until such time as the employer has fulfilled his obligations or, if this is no longer possible, adequate redress has been established, in accordance with the arrangements and procedures to be determined by the Member States.

The provision of the previous paragraph also applies to corresponding obligations under the agreements referred to in Article 3.

Within the meaning of the previous paragraphs, serious breaches are:

(a) the total absence of information and/or consultation of the employees' representatives prior to a decision being taken or the public announcement of that decision; or

(b) the withholding of important information or provision of false information rendering ineffective the exercise of the right to information and consultation.

Article 8

Link between this Directive and other Community and national provisions

1. This Directive constitutes the general framework for employee information and consultation in undertakings in the European Community. It is also applicable to the information and consultation procedures set out in Article 2 of Council Directive 98/59/EC and Article 6 of Directive 77/187/EC.

2. This Directive does not prejudice the provisions adopted in accordance with Council Directive 94/45/EC of 24 September 1994 on the establishment of a European Works Council or a procedure in Community-scale undertakings and Community-scale groups of undertakings for the purposes of informing and consulting employees.

3. This Directive shall be without prejudice to other rights of employees to information, consultation and participation under national law.

Article 9

Transposition of the Directive

1. Member States shall adopt the laws, regulations and administrative provisions necessary to comply with this Directive no later than . . . (two years after adoption) or shall ensure that the social partners introduce the required provisions by way of agreement, the Member States being obliged to take all necessary steps enabling them to guarantee the results imposed by this Directive at all times. They shall forthwith inform the Commission thereof.

2. Where Member States adopt these provisions, they shall contain a reference to this Directive or shall be accompanied by such reference on the occasion of their official publication. The methods of making such reference shall be laid down by the Member States.

Article 10

Review by the Commission

Not later than . . . (five years after adoption), the Commission shall, in consultation with the Member States and the social partners at Community level, review the application of this Directive with a view to proposing to the Council any necessary amendments.

Article 11

This Directive is addressed to the Member States.

(1) OJ L 225, 12.8.1998, p. 16.

(2) OJ L 61, 5.3.1977, p. 26.

OJ L 201, 17.7.1998, p. 88.

(3) OJ L 254, 30.9.1994, p. 64.

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