Ready. Set. Miss. How The Commission Missed The Target On EWCs

Reading the recent EU Commission Evaluation on European Works Councils is like watching this video of a Dutch fourth division soccer match: good tackle, direct run on goal, the keeper goes down, the attacker finds himself alone in front of a huge goal… and misses, completely. Inexplicably. In front of a capacity crowd. Likewise, the Commission lays down an admirably correct and critical analysis of the problems with EWCs, identifies the causes and… misses the ball totally when it comes to solutions:

On 14 May 2018, the European Commission published a report evaluating the implementation of the European Works Council Recast Directive (2009/38/EC). Reading its official Communication, one senses an upbeat assessment of the current state of play and genuine enthusiasm about the performance of this pioneering piece of EU legislation on workers’ rights. There is talk of a “positive evaluation” and that successes outweigh the shortcomings faced by EWCs in practice.  Hence, the only follow-up measures proposed are to develop a ‘practical handbook’ and to provide over “€7million [of] funding”. Commissioner Thyssen commented that all this is to “stimulate more take-up of this important instrument and to make existing ones even more effective”.

The stark truth of the matter is, however, that this is all pure spin.

Many stakeholders, including the authors of this post, have been waiting impatiently for the Commission’s report. (It should have been issued no later than 5 June 2016 but was postponed several times). So, we studied the 63-page document with great interest – only to end up disappointed at missed chances.

Positive, really?

And let’s also be clear. Nobody (at least to our knowledge) says that this 2009 EWC Recast was a failure. It brought about necessary improvements in terms of rights (for example, the right to training for employee representatives) and clarity regarding the competences of the EWC (e.g. what is meant by information and consultation).

Yet calling the whole experience unequivocally ‘positive’ is stretching it too far, even by the standards set by the Commission itself.

Let’s look at some examples.

One of the main declared objectives of the Recast was to foster the establishment of more EWCs. However, in the words of the Commission “the Recast Directive did not lead to an increase in the rate of creation of EWCs”.

Second example: In Europe, we are good at making rules, but enforcing them is more problematic. Sanctions must therefore be ‘effective, dissuasive and proportional’.  The Commission clearly sees that “there are significant differences in the levels of (…) financial penalties for a breach of EWC rights” and that “the nature and level of sanction are in many cases not effective, dissuasive and proportionate”.

Third example (but we could easily go on): EWCs are designed to address transnational issues. But how does the law actually define a transnational issue? The Commission duly reviews two court decisions about the interpretation of transnationality and concludes that “difficulties remain (…) over how to interpret the notion of transnationality, which creates some confusion concerning the type of information to disseminate to EWC members”.

With the EWC Recast Directive, the Commission qualified for the World Cup, but much remains to be done before they can lift the social Europe trophy. But luckily (?) they have a plan to make it to the final!

Make Europe social with a handbook and some money

The strategic attack plan of the Commission contains three axes: (1) creating a practical handbook, (2) providing funds and (2) facilitating exchanges between the Members States on enforcement. As such, they want to increase the number of EWCs, to bolster their effectiveness, to share good practices and to address some shortcomings in the implementation and enforcement.

There is a plan, sure, but it’s probably not worth your tickets to Russia. A handbook can solve issues caused by, e.g., a lack of skills or knowledge about possible practices or solutions. But the problems identified in the report have different causes. Based on our research, we’re convinced these problems require solutions geared towards treating the cause, not the symptoms. Think about the lack of effective sanctions, the lack of means to finance litigation, the abuse of confidentiality, the legal status of the EWC. These are problems grounded in legal shortcomings which require legal remedies. Legislators in the Member States don’t act according to recommendations in handbooks, they implement legal rules. Like soccer refs. Take away their yellow and red cards, provide them some ‘good examples’ to show the players and let’s see what happens to the level of fair play.

More money?  (Actually, not really…)

Next, the Commission plans to ‘mobilize funds’ to support EWCs. Let there be no mistake, financial resources are often needed to take the first steps in establishing and negotiating EWCs, improving members’ skills and knowledge, and developing projects. But when the Commission announces the mobilization of over €7m, this is no more than what the Commission has made available for information and consultation-related projects each year over the past decade or more. The only difference is that there will be a priority, for one year, for EWC-related projects. Moreover, the Commission itself clearly states in the document that “This initiative will not require additional resources from the EU budget”.  So, instead of putting its money where its mouth is, the Commission is putting its mouth where the money already was.

As the third solution, the Commission promises to ensure proper implementation of the Recast Directive by facilitating exchanges between the Member States, notably on the issue of sanctions and enforcement. Again, the Commission clearly recognizes the problem and we fully share this analysis. At the same time, we see no reason to believe that merely facilitating exchanges of info will incentivize the Member States to strengthen sanctions, so they match the levels of penalties on companies for breaching stock exchange regulations, to name but one example. Ready. Set. Miss.

Together with SE Works Councils, EWCs are the only genuinely European institution for the information and consultation of employees. These bodies mobilize tens of thousands of employee representatives, and cover millions of workers. They are a visible example that ‘Europe’ can do something for workers, that it can show a social face, that it can strengthen employees’ position, and that it promotes social dialogue. The recently published ‘European Appeal’ for more democracy at work accordingly calls for more decisive steps in Europe towards workers participation.

Within a Europe aiming to enhance its social dimension, the Commission took its time in evaluating the EWC instrument. It rightly identified some improvements and did not shy away from naming numerous gaps and problems in practice.  There was the goal, gaping wide open. But, seeing only a handbook and handful of gold, the Commission missed the ball entirely, just like that unfortunate football player in the Dutch fourth division. Or Germany’s Thomas Müller against South Korea. Or was the Commission aiming to lose, like England against the Belgians?