CELEX: 51990PC0581
Language: en
Date: 1991-01-25
Title: PROPOSAL FOR A COUNCIL DIRECTIVE ON THE ESTABLISHMENT OF A EUROPEAN WORKS COUNCIL IN COMMUNITY-SCALE UNDERTAKINGS OR GROUPS OF UNDERTAKINGS FOR THE PURPOSES OF INFORMING AND CONSULTING EMPLOYEES

No C 39/10                           Official Journal of the European Communities                                  1.5. 2. 91
                                                 COMMISSION
              Proposal for a Council Directive on the establishment of a European Works Council in
              Community-scale undertakings or groups of undertakings for the purposes of informing and
                                                    consulting employees
                                                     COM(90) 581 final
                                    (Submitted by the Commission on 12 December 1990)
                                                        (91/C 39/11)
 THE COUNCIL OF THE EUROPEAN COMMUNITIES,                        Whereas Council Directive 75/129/EEC of 17 February
                                                                  1975 on the approximation of the laws of the Member
                                                                  States relating to collective redundancies (*) and Council
 Having regard to the Treaty establishing the European            Directive 77/187/EEC of 14 February 1977 on the
 Economic Community, and in particular Article 100                approximation of the laws of the Member States relating
 thereof,                                                         to the safeguarding of employees' rights in the event of
                                                                  transfers of undertakings, businesses or parts of busi-
                                                                  nesses (2) incorporate compulsory procedures              for
 Having regard to the proposal from the Commission,               informing and consulting the representatives of the
                                                                  employees affected by the operations in question;
 Having regard      to  the   opinion   of   the  European
 Parliament,                                                     Whereas        these    information    and      consultation
                                                                 requirements do not aim to cover all situations likely to
                                                                 affect the employees' interests and, in particular, do not
 Having regard to the opinion of the Economic and                extend specifically to situations in which the decision-
 Social Committee,                                               making centre is not situated in the Member State in
                                                                 which the employees affected by its decisions are
                                                                 employed;
Whereas point 17 of the Community Charter of Funda-
 mental Social Rights of Workers provides, inter alia, that
 information and consultation for workers must be
 developed along appropriate lines, taking account of the        Whereas this situation has a direct effect on the
practices in force in the various Member States; whereas         operation of the internal market and consequently needs
the Charter states that 'this shall apply especially in          to be remedied;
 companies or groups of companies having establishments
 or companies in two or more Member States';
                                                                 Whereas appropriate provisions must be adopted to
                                                                 ensure that the employees of Community-scale under-
Whereas the completion of the internal market is bound           takings or groups of undertakings are properly informed
to generate a process of concentrations of undertakings,         and consulted in cases where decisions likely to affect
cross-border mergers, take-overs, joint-ventures and             them are taken outside the Member State in which they
consequently, a transnationalization of undertakings and         are employed;
groups of undertakings; whereas, if economic activities
are to develop in a harmonious fashion, this situation
requires that undertakings and groups of undertakings            Whereas, in order to guarantee that the employees of
operating in more than one Member State must inform              undertakings or groups of undertakings operating in two
and consult the representatives of their employees               or more Member States are properly informed and
affected by their decisions;                                     consulted, a European Works Council must, in principle,
                                                                 be set up;
Whereas procedures for informing and consulting
employees as embodied in legislation or practice in
Member States are often inconsistent with the transna-           Whereas European Works Councils in such undertakings
tional structure of the entity which takes the decisions         or groups must encompass all establishments or, as the
affecting those employees; whereas this may lead to              case may be, group undertakings located in the
unequal treatment of employees affected by the decisions
of one and the same undertaking, or group of under-              (') OJ No L 48, 22. 2. 1975, p. 29.
takings ;                                                        (2) OJ No L 61, 5. 3. 1977, p. 26.
 ---pagebreak---  15.2.91                               Official Journal of the European Communities                            No C 39/11
 Community, irrespective of whether the undertaking or,           HAS ADOPTED THIS DIRECTIVE:
 in the case of a group, the controlling undertaking, has
 its central management outside the Community;
                                                                                          SECTION I
Whereas, in accordance with the principle of autonomy                                       General
 of the parties, it is for the representatives of employees
 and the management of the undertaking or the                                               Article 1
controlling undertaking in a group to determine by                1.    The object of this Directive is to improve the
 agreement the nature, composition, competence, mode              provision of information to and the consultation of
 of operation, procedures and financial resources of the          employees in Community-scale undertakings and groups
 European Works Council so as to suit their own                   of undertakings.
particular circumstances;
                                                                  2.    To this end, a European Works Council (here-
Whereas, however, in the absence of such an agreement,            inafter    'EWC')    shall be established     in   every
certain minimum requirements in respect of the compo-             Community-scale undertaking and group of under-
sition, functions and powers, procedures and financial           takings, where this is requested in the manner provided
resources of the European Works Council should apply;            for by Article 5 (3), with the purpose of informing and
                                                                 consulting their employees upon the terms, in the
                                                                 manner and with the effects laid down by this Directive.
Whereas, moreover, the employees' representatives may
unanimously agree not to seek the setting up of a
European Works Council and, in these circumstances,
the parties may decide upon an alternative procedure for                                   Article 2
informing and consulting employees on condition that             For the purposes of this Directive:
such an alternative procedure meets certain basic
conditions;
                                                                 (a) 'Community-scale undertaking' means an under-
                                                                      taking with at least 1 000 employees within the
Whereas the European Works Council must be kept                       Community and with at least two establishments in
informed as to the activities and prospects of the under-             different Member States each employing at least 100
taking or group of undertakings so that it may assess the             employees;
possible impact on the workers' interests; whereas, to
this end, the undertaking or the controlling undertaking
should be required to communicate to the European                (b) 'Community-scale group of undertakings' means a
Works Council, on the occasion of an annual meeting,                  group of undertakings with at least 1 000 employees
general information directed towards the interests of the             within the Community and with at least two group
employees and information relating more specifically to               undertakings in different Member States each of
those aspects of the undertaking's or group of under-                 which employs at least 100 employees within the
takings' activities and prospects which are liable to affect          Community;
the employees' interests;
                                                                 (c) 'group of undertakings' comprises a controlling
                                                                      undertaking and its controlled undertakings;
Whereas, before the implementation of any decision
significantly affecting the employees' interests, the
European Works Council should also be informed in                (d) 'representatives of the employees' means the
good time and invited to give its opinion;                            employees' representatives provided for by the laws
                                                                      or practice of the Member States, with the exception
                                                                      of members of administrative, managing or super-
Whereas the information and consultation requirements                 visory bodies of companies who sit on such bodies as
laid down by this Directive should be implemented in the              employees' representatives.
case of an undertaking or, in a group, a controlling
undertaking, having its central management in a
non-member country, by its representative agent in the
Community or, in the absence of such an agent, by the                                      Article 3
establishment or controlled undertaking employing the            1.     For the purpose of this Directive, a 'controlling
highest number of employees in the Community;                    undertaking' is an undertaking which:
Whereas appropriate remedies must be provided by                 (a) has a majority of the shareholders' or members'
Member States in the event of failure to comply with the              voting rights of another undertaking (controlled
obligations provided for by this Directive,                           undertaking);
 ---pagebreak--- No C 39/12                             Official Journal of the European Communities                                 15.2.91
    or                                                           2.     The setting up of the EWC shall be the responsi-
                                                                 bility of the central management of the Community-scale
                                                                 undertaking or, in the case of a Community-scale group
(b) has the right to appoint or remove a majority of the
                                                                 of undertakings, of the central management of the
    members of the administrative, management or
                                                                 controlling undertaking.
    supervisory board of another undertaking, and is at
    the same time a shareholder in, or member of, that
    undertaking (controlled undertaking);                         3.    Where a Community-scale undertaking or, in the
                                                                  case of a Community-scale group of undertakings, the
    or                                                            controlling undertaking, has its central management
                                                                  outside the Community, the responsibility referred to in
                                                                 paragraph 2 shall lie with its representative agent in the
(c) has the right to exercise a dominant influence over           Community to be designated, if necessary, or, in the
    an undertaking of which it is a shareholder or                absence of such an agent, by the management of the
    member, pursuant to a contract entered into with              establishment employing the highest number of
    that undertaking or to a provision in its memo-               employees in a Member State, or the central
    randum and articles of association, where the law             management of the group undertaking employing the
    governing that undertaking (controlled undertaking)           highest number of employees in the Community.
    permits its being subject to such contracts or
    provisions;
                                                                  4.    The law applicable in order to determine whether
                                                                  an undertaking is a 'controlling undertaking' shall be the
    or
                                                                  law of the Member State which governs that under-
                                                                  taking. Where the law governing the undertaking is not
(d) is a shareholder in or member of an undertaking,              that of a Member State, the law applicable shall be the
    and:                                                          law of the Member State in which the representative
                                                                  agent of the undertaking or, in the absence of such an
                                                                  agent, the central management of the group undertaking
     (i) has had the power to appoint, solely as a result
                                                                  which employs the highest number of employees in the
         of the exercise of its voting rights, a majority of
                                                                  Community is situated.
         the members of the administrative, management
         or supervisory bodies of that undertaking
         (controlled undertaking) who have held office
         during the financial year and during the                                        SECTION II
         preceding financial year, or
                                                                                    The EWC Agreement
    (ii) alone controls, pursuant to an agreement with                                     Article 5
         other shareholders in or members of that under-          1.    The nature, composition, competence and mode of
         taking (controlled undertaking), a majority of           operation of the EWC shall be determined by means of a
         shareholders' or members' voting rights in that          written agreement concluded between the central
         undertaking.                                             management of the Community-scale undertaking, or, in
                                                                  the case of a Community-scale group, the controlling
2.    For the purpose of paragraph 1 (a), (b) and (d), the        undertaking, and a special negotiating body drawn from
controlling undertaking's rights as regards voting,               the representatives of the employees of the undertaking
appointment and removal shall include the rights of any           or group. Where there are no employee representatives
other controlled undertaking and those of any person or           within the meaning of Article 2 (d), the employees
body acting in his or its own name but on behalf of the           concerned shall be entitled to elect from among their
controlling undertaking or of any other controlled                number representatives for the purpose of this Article.
undertaking.
                                                                  2.    The special negotiating body shall include at least
                                                                  one employee representative from each Member State in
                          Article 4
                                                                  which the Community-scale undertaking employs at least
 1.   EWCs shall encompass:                                        100 employees or, in the case of a Community-scale
                                                                  group of undertakings, from each group undertaking
                                                                  employing at least 100 employees within the Community.
(a) in the case of Community-scale undertakings, all the          Member States shall make provision for the special nego-
    establishments located within the Community each              tiating body to include additional representatives, up to a
    of which employs at least 100 employees;                      maximum of five, to be drawn from Member States or,
                                                                  as the case may be, group undertakings in which signifi-
(b) in the case of a Community-scale group of under-              cantly more than 100 employees are employed. The
    takings, all the group undertakings located within            additional representatives      shall be allocated       in
    the Community each of which employs at least 100              accordance with systems which take into account the
    employees.                                                    number of staff they represent.
 ---pagebreak--- 15. 2. 91                               Official Journal of the European Communities                             No C 39/13
3.    At the written request of any employees or of their         2.     However, by written agreement between the central
representatives, or on the initiative of the central              management of the Community-scale undertaking or, in
management of a Community-scale undertaking or, in                the case of a group, the controlling undertaking and the
the case of a Community-scale group, of a controlling             special negotiating body entered into at the conclusion
undertaking, a meeting of the special negotiating body            of the negotiations, it may be decided not to set up a
shall be convened by the said central management. The             EWC but only on condition that the minimum
composition of this body shall be determined in                   requirements in relation to information and consultation
accordance with paragraph 2. At the end of the aforesaid          set out at paragraphs (a), (c), (d), (f) and (g) of the
meeting, the special negotiating body shall inform the            Annex, as well as in Article 9 of this Directive are
central management in writing of its request for the              respected mutatis mutandis.
opening of negotiations with a view to concluding the
agreement referred to in Article 6 ( 1 ) . For the purpose of
such negotiations, it may be assisted by experts of its
choice. However, the special negotiating body may                                         SECTION III
decide unanimously not to request the setting up of a
EWC.                                                                                 Absence of agreement
4.     Member States shall also make provision for the                                      Article 7
costs of the discussions held under paragraphs 1 and 3 to
                                                                   1.    Where     the    central    management      of   the
be met by the undertaking or, in the case of a group, by
                                                                   Community-scale undertaking, or the controlling under-
the controlling undertaking.
                                                                  taking in a Community-scale group of undertakings, and
                                                                   the special negotiating body so decide, or in so far as
                                                                  they fail to reach the agreement mentioned in Article 6
5.     Each Member State shall determine the manner in
                                                                  within one year of the initial request to convene the
which representatives of employees or, in the absence
                                                                   special negotiating body referred to in Article 5 (3), the
thereof, the body of employees, employed in its territory
                                                                   minimum requirements laid down by the legislation of
by Community-scale undertakings or groups of under-
                                                                   the Member State in which the central management of
takings shall appoint or elect members of the special
                                                                  the undertaking or, in the case of a group, the
negotiating body.
                                                                   controlling undertaking is situated, shall apply.
6.     For the purpose of identifying the representatives of
employees employed in other Member States, each                    2.    The minimum requirements referred to in
Member State shall refer to the appropriate laws which             paragraph 1 shall be subject to the rules contained in the
implement paragraph 5 in the other Member States.                 Annex.
                          Article 6
                                                                                          SECTION IV
 1.    The agreement between the central management of
the Community-scale undertaking or, in the case of a                                     Miscellaneous
Community-scale group, the controlling undertaking and
the special negotiating body shall determine:
                                                                                            Article 8
                                                                   1.    Each Member State may provide that the central
(a) the nature and composition of the EWC, the number
                                                                   management of the Community-scale undertakings or
     of members, the allocation of seats and the method
                                                                   controlling undertakings situated in its territory has the
     and duration of appointment or election of the
                                                                   right to withhold information which, if disclosed, would
     members;
                                                                   substantially damage the interest of the undertakings
                                                                   concerned.
 (b) the functions and powers of the EWC;
                                                                   2.    Member States shall provide that members of the
 (c) the procedure for informing and consulting the                EWC or the employees to whom they refer, shall not
     EWC;                                                          reveal to third parties any information which has been
                                                                   provided to them in confidence.
(d) the place, frequency and duration of meetings of the
     EWC;
                                                                                            Article 9
(e) the financial and material resources to be allocated           The members of the special negotiating body and the
     to the EWC.                                                   members of the EWC shall enjoy, in the exercise of their
 ---pagebreak--- No C 39/14                                Official Journal of the European Communities                                     15. 2. 91
functions, the same protection and guarantees provided                                            Article 11
for employees' representatives by the national legislation
                                                                        1.    This Directive shall be without prejudice to
or practice in force in the country of employment. In any
                                                                        measures taken pursuant to Directive 75/129/EEC and
event they must be allowed to attend meetings of the
                                                                        Directive 77/187/EEC.
special negotiating body or the EWC and those members
who are employees of the Community-scale undertaking
or group undertaking must be guaranteed payment of                      2.     Nothing in this Directive shall affect the operation
full wages for the duration of any absence from work in                 of the laws or practice of the Member States in respect
connection with their duties.                                           of the provisions of information to and the consultation
                                                                        of employees at group level, undertaking level and estab-
                                                                        lishment level.
                          SECTION V                                     3.    This Directive shall not affect the right of the
                                                                        Member States to apply or introduce laws, regulations or
                        Final provisions
                                                                        administrative provisions more favourable to employees.
                            Article 10
                                                                                                  Article 12
1.    Each Member State shall ensure that the
                                                                        1.     Member States shall implement the laws, regu-
management of the establishments or group undertakings
                                                                        lations and administrative provisions necessary to comply
situated in its territory and their employees' represen-
                                                                        with this Directive by 31 December 1992 at the latest.
tatives or, as the case may be, employees abide by the                  They shall immediately inform the Commission thereof.
obligations laid down by this Directive, irrespective
of    whether      the     central    management         of    the
Community-scale undertaking or of the controlling                       2.    When Member States adopt these provisions, these
undertaking is situated in its territory.                               shall contain a reference to this Directive or shall be
                                                                        accompanied by such reference at the time of their
                                                                        official publication. The procedure for such reference
2.    Member States shall provide for appropriate                       shall be adopted by Member States.
remedies in the event of failure to comply with this
Directive, and, in particular, shall ensure that adequate                                         Article 13
procedures exist at the suit of the EWC for the
enforcement of obligations under this Directive.                        This Directive is addressed to the Member States.
                                                                 ANNEX
                                                          Minimum requirements
              1. The minimum requirements referred to in Article 7 (1) shall cover the matters set out in Article 6 (1)
                 and shall be subject to the following conditions:
                 (a) The competence of the EWC shall be limited to those matters which concern the Community-scale
                     undertaking or group of undertakings as a whole or at least two of its establishments or group
                     undertakings situated in different Member States. In the case of Community-scale undertakings or
                     groups of undertakings referred to in Article 4 (3) of this Directive the competence of the EWC
                     shall be limited to those matters concerning all their establishments or group undertakings located
                     inside the Community or concerning at least two of their establishments or group undertakings in
                     different Member States.
                 (b) The EWC shall:
                       (i) subject to paragraph b (ii), have a minimum of three members and a maximum of 30;
 ---pagebreak--- 15. 2. 91                              Official J o u r n a l of t h e E u r o p e a n C o m m u n i t i e s              N o C 39/15
                  (ii) include at least one member from each Member State in the territory of which a
                       Community-scale undertaking has an establishment employing at least 100 employees or, in the
                       case of a group, at least one member from each group undertaking employing at least 100
                       employees;
                 (iii) be composed of representatives of the employees of the undertakings in question who are
                       appointed, elected, replaced and removed by the representatives of employees or, in the
                       absence thereof, by the body of employees, in accordance with systems which take into
                       account, in an appropriate manner, the number of staff they represent.
             (c) The EWC shall have the right to meet with the central management of the undertaking                  or
                 controlling undertaking at least once a year, to be informed of the progress of the undertaking's    or
                 group of undertakings' business and of its prospects. This information shall relate in particular to its
                 structure, economic and financial situation, the probable development of the business and            of
                 production and sales, the employment situation and probable trend, and investment prospects.
             (d) Subject to subparagraph (a) above, the EWC shall have the right to be informed and consulted by
                 the central management of the undertaking or controlling undertaking about any management
                 proposal likely to have serious consequences for the interests of the employees of the undertaking.
                 This consultation shall be timely and shall be carried out on the basis of a report from the central
                 management of the undertaking or group of undertakings, on which the EWC may put forward its
                 opinion. The final decision shall be exclusively the responsibility of the central management of the
                 undertaking or controlling undertaking.
             (e) In addition to the annual meeting provided for by paragraph (c), at least one special meeting
                 between the EWC and the central management of the undertaking or controlling undertaking shall
                 be held per year where necessary for the purposes of paragraph (d) above. This shall be convened by
                 the central management of the undertaking or controlling undertaking at the request of the EWC.
             (f) The members of the EWC shall inform the workers' representatives at establishment or at group
                 undertaking level or, in the absence thereof, the body of employees, of the content and outcome of
                 the information and consultation process carried out in accordance with this Annex.
             (g) The operating expenses of the EWC shall be borne by the central management of the undertaking
                 or controlling undertaking. The central management concerned shall provide the members of the
                 EWC with such financial and material resources as enable them to meet and perform their duties in
                 an appropriate manner. In particular, the cost of the meeting facilities and interpretation, and the
                 accomodation and travel expenses of members of the EWC, shall be met by the central management
                 of the undertaking or controlling undertaking.
          2. Article 5 (5) and (6) of this Directive shall apply mutatis mutandis.