Let’s Give A New Boost To European Works Councils

Stan De Spiegelaere

The social policy track record of the European Union is bleak at best. But in one field the EU did make a marked difference: in 1994 it agreed on the European Works Councils Directive. In multinational companies of a certain size, employee representatives from across Europe have since enjoyed the right to be informed and consulted by management. But has the momentum stalled?

Together with the national works councils, these European Works Councils (EWCs) protect the fundamental right to ‘information and consultation in good time and at the appropriate level’, as enshrined in the European Charter of Fundamental Rights. Concretely, the European Works Councils can be organized in multinational companies with more than 1000 employees and at least 150 employees in two EEA countries.

Looking at the figures, the EWC policy could be called a success. Over the years, more than 1000 EWCs have been created, mobilizing tens of thousands employee representatives from all over Europe and covering an estimated 19 million employees.

This year, the European Commission is planning an evaluation of its policy and while the figures may look impressive, there is still a need to propel things forward and search for ways to increase the number of EWCs created.

30 more years to establish a fundamental right

 Let’s not get blinded by the light and take a second look at the figures. After some years of steep growth, the number of new EWCs is falling. Between 2012 and 2014 new EWCs amounted to only 24 compared with the record year of 1994 when more than 400 EWCs were created.

At the current pace, it would take over 30 years before all employees in multinational companies are guaranteed their fundamental right to information and consultation on transnational issues.

And this decline is not because of a lack of companies eligible to have an EWC. Although there is no perfect list of all companies that could have one, the available estimations suggest that even today less than half of all companies eligible actually have an EWC in place. This means that there are still about 19 million employees lacking transnational information and consultation rights. And at the current pace, it would take that long to get them covered.

Known obstacles and solutions

Realising this, Europe returned to action in 2009 by launching a Recast of the original directive. This Recast had as one of its objectives to increase the number of EWCs. It tried to do so in various ways but was markedly ineffective in stimulating the creation of more EWCs as the most common obstacles remained unaddressed: the lack of awareness, information and capacity.

• Awareness: A good many employees in multinationals do not even know about the possibility of creating an EWC. They don’t even know it exists. This is obviously a pretty big problem because as a rule, EWCs are created on the initiative of the employees or their representatives.
• Information: Even when employees are aware of the existence of EWCs, they and their representatives often do not know whether their company is large enough or not. This information is not public. There is no administrative database or registry of European multinationals, including data about the number of employees they have.
• Capacity: Even when there is awareness and information, employee representatives need to be able to start the process. They need to know the representatives or employees of other countries and to liaise with them, overcome linguistic barriers and start negotiations. In companies and sectors with low trade union density or in countries with weak national information and consultation traditions, employees often lack the capacity to enforce their fundamental rights.

These barriers are known, important but also perfectly surmountable. Country-by-country reporting about employee figures could help solve the information problem, information campaigns directed to those companies could resolve the awareness issue and capacity building can happen through strengthening trade unions’ presence and improving local works councils.

If Europe is serious about becoming Triple A Social Europe, as it claims to want to be, it can start by ensuring fundamental rights to information and consultation on transnational issues for all employees.