Opinion of the committee of the Regions on the proposal for a Council Directive 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
Date: 1995-04-21
Institutions: European Committee of the Regions
Subjects: approximation of laws, labour law, transfer of businesses, worker consultation, worker information













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51995IR0143

Opinion of the committee of the Regions on the proposal for a Council Directive 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  CdR 143/95  


Official Journal C 100 , 02/04/1996 P. 0025 





Opinion on the proposal for a Council Directive 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 () (96/C 100/06) On 15 November 1994, the Bureau of the Committee of the Regions decided to draw up an Own-initiative Opinion on the above-mentioned proposal.Commission 8 for Economic and Social Cohesion, Social Policy and Public Health, which was responsible for drawing up the Committee's work on the subject, adopted its Opinion on 16 March 1995. The Rapporteur was Mr Sileoni.At its 7th Plenary Session of 20 and 21 April 1995 (meeting of 21 April), the Committee of the Regions adopted the following Opinion.GENERAL COMMENTS The Committee of the Regions emphasizes that the overriding concern of local and regional authorities is that any amendments made to Directive 77/187/EEC should be as clear as possible, should resolve the areas of uncertainty that do still exist in the Directive without creating further ones and should not impose new burdens on authorities, while providing reasonable protection for employees and the consequent benefit for industrial relations.The Committee of the Regions calls upon the Commission to examine the possibility of including in the Directive the principle of safeguarding employees' entitlements to old age, invalidity or survivors' benefits on the basis of supplementary occupational or inter-occupational welfare schemes operating independently of Member States' compulsory social security systems.SPECIFIC COMMENTS 1. Section I1.1. Article 1(1)1.1.1. The Committee of the Regions is keenly interested in clarifying the scope of the Directive.1.1.2. The Committee feels that the Commission's declared intention to exclude from the scope of the Directive the transfer of an activity where this does not amount to the transfer of a business or undertaking is unlikely to achieve such clarification.1.1.3. The Committee fears that the precise effects of this proposal on scope are far from clear. The experience of those exercising local and regional responsibilities is that this distinction is easier to draw in the abstract than to apply in practice.1.1.4. Given that there is now a degree of certainty about the legal position regarding the applicability of the transfer of undertakings provisions, the Committee considers that any change raising new doubts in the area should be opposed. Since the proposed change is likely to be more trouble than it is worth, it should be dropped.1.1.5. In connection with the above comments, the Committee would urge that the concept of total or partial transfer of an undertaking, and the scope of the Directive, be defined with the greatest terminological, conceptual and legal clarity.1.2. Article 1(5)1.2.1. The Committee is puzzled by the inclusion of Article 1(5) in the draft Directive.1.2.2. The Committee has serious doubts about how a distinction can be made between bankruptcy (or analogous) proceedings instituted with a view to liquidation, and insolvency proceedings not involving liquidation [Article 3(4)]. Local and regional authorities consider this to be a distinction easy to make in theory, but which will raise numerous problems of interpretation, given that it is impossible to predict whether bankruptcy proceedings will lead to liquidation or not.1.2.3. The Committee believes that the draft Directive would be clearer if Article 1(5) were deleted.1.3. Article 2(2)1.3.1. The Committee recognizes that Article 2(2) as a whole offers greater protection for employees. Since the 1977 Directive made no mention of workers with part-time or fixed-duration contracts, the Committee welcomes the innovation proposed in this area by the draft Directive.2. Section II2.1. Article 3(1)2.1.1. The Committee shares the reservations expressed by some local and regional authorities about the proposal to extend joint liability for contractual obligations, since this could impose significant burdens on local and regional authorities. It therefore suggests that, in the first line of the second paragraph of Article 3(1), the words 'shall provide` be replaced by 'may provide`, in line with the current Directive on acquired rights. The present position is well understood in the Member States which have not introduced the principle of joint liability; in the absence of a compelling reason for it, the Committee opposes the proposed change.2.1.2. The Committee is not convinced that the draft Directive's proposal for Article 3(1), namely the introduction of the sentence 'However... date of transfer`, is quite clear.2.1.3. Although recognizing that this proposal may, in the final analysis, represent an improvement on the 1977 Directive (and, consequently, in terms of the effects for local and regional authorities), the Committee fears that the text as currently presented may be difficult to verify legally.2.1.4. The Committee agrees that the concept contained in the new element introduced in Article 3(1) should be retained, but the second sentence ('Member States... relationship`) should be re-worded so as not to diminish the effect of the previous sentence.2.2. Article 3(4)2.2.1. In an earlier paragraph, the Committee expressed its puzzlement at the retention of Article 1(5) in the draft Directive, explaining the problems that interpretation of the terms 'bankruptcy proceedings or any other analogous proceedings instituted with a view to the liquidation of the assets` would entail.2.2.2. In the Committee's view, Article 3(4) is closely linked to Article 1(5) mentioned above.2.2.3. The Committee therefore hopes that if Article 1(5) is deleted, Article 3(4) would be re-drafted without reference to 'insolvency proceedings... or other analogous non-liquidation proceedings`.2.2.4. The Committee instead proposes that a re-drafted Article 3(4) should refer to 'insolvency proceedings or proceedings for suspension of payments`.2.3. Article 4(3)2.3.1. The Committee of the Regions welcomes the facility for negotiation with the employer granted to employees.2.4. Article 4(5)2.4.1. The Committee fails to understand the introduction of this paragraph, which could raise problems for certain local and regional authorities, and calls upon the Commission to give further thought to this point, with a view to its possible deletion.3. Section III3.1. The Committee would like the following to be added to the first paragraph of Article 6: 'The Member States may uphold the right of the transferor and the transferee (i) not to divulge confidential financial information; or (ii) to communicate it confidentially and in accordance with the established rules in the Member States.`3.2. Article 6(1)3.2.1. The Committee is fully aware that Article 6(1) is a text currently in force on which it is not expected to comment in its Opinion.3.2.2. The Committee would, however, take this opportunity to make one observation in this regard, particularly with a view to any re-drafting of the existing Directive and the present draft.3.2.3. The Committee regrets the lack of precision of the expression 'in good time`, open to vague interpretation and which might, consequently, be detrimental to employees' interests.3.3. Article 6(2)3.3.1. The Committee is unsure of the exact meaning of the expression 'with a view to reaching an agreement`: it feels that practical application of Article 6(2) could involve problems of interpretation.3.3.2. The Committee wonders what might happen in the absence of agreement.3.4. Article 6(5)3.4.1. The Committee is not entirely satisfied with the inclusion of Article 6(5) in the draft Directive.3.4.2. The Committee considers that the number of employees alone is not sufficient to determine the size of an undertaking, particularly in view of the new technologies which are replacing workers.3.4.3. The Committee of the Regions therefore suggests that the most favourable Member State legislation in this area be taken into account.Done at Brussels, on 21 April 1995.The Chairman of the Committee of the RegionsJacques BLANC() OJ No C 274, 1. 10. 1994, p. 10.