On the night of Tuesday 20 to Wednesday 21 May, European co-legislators reached a political agreement on the revision of the Directive on European Works Councils (EWCs).
EWCs or other transnational information and consultation formats currently exist in around 1,000 multinational companies, representing around 16.6 million employees in the EU.
The revision of the 2009 directive on EWCs, proposed for 2024 (see EUROPE 13335/19), is intended to provide better information for workers in the event of restructuring operations affecting employees of large multinational companies operating in at least two EU or European Economic Area countries.
The provisional political agreement clarifies:
- transnational matters that must be subject to the consultation of EWCs, decisions that substantially affect workers in more than one Member State, thereby triggering an obligation to inform and consult an EWC. However, this does not extend to day-to-day decisions or issues that only affect employees in a trivial way. The scope of any potential effects of transnational issues on the workforce should therefore be clarified and the level of management in question should be taken into account when determining whether an issue falls within the remit of a European Works Council;
- gender representation, with 40% of the seats of special EWC negotiating groups allotted to members of either gender. No obligation has been established here, as the Council wanted;
- the question of financial penalties;
- confidentiality of information.
Companies will have to provide easier access to information and justify their refusal to share it or why confidentiality needs to be maintained in certain cases. The new rules also improve workers’ consultation rights by ensuring that their representatives can be consulted before a decision affecting them is taken.
The European Parliament negotiators have secured the right for the EWC to meet central management in person at least twice a year, the European Parliament says.
As far as confidentiality is concerned, the agreement stipulates that experts assisting EWCs or members of special negotiating groups must not divulge any information that has not first been validated by the company, for its own good. However, central management should also, if possible, set a time limit for these confidentiality requirements. Restricting the provision of information should also meet a legitimate interest for the company, based on an objective criterion defined in law.
It is possible to withhold certain information, but the company will have to justify the reasons and allow for recourse.
On the question of gender, the special negotiating groups will also have to explain the reasons why they were unable to achieve a composition of at least 40% men or women. Failure to reach this threshold will not, however, prevent the creation of an EWC.
With regard to financial penalties, the agreement states that the company’s annual turnover should be taken into account (a key request of the Parliament) and that the penalty should be determined on the basis of the gravity, consequences and duration of the failure to comply with the law, as well as whether or not the failure to comply was intentional or negligent.
For its part, the EU Council has ensured that sanctions can take a form other than that of a penalty based on turnover, as long as it retains the same dissuasive effect.
(Original version in French by Solenn Paulic)