With the official Brexit negotiations underway, it’s a good time to look at the potential impact of the process on European Works Councils (EWCs).
EWCs were created to bring together the employees of large companies operating in a pan-European capacity. The meetings are an opportunity for employees to share concerns with management and receive updates on company developments and strategy. The Directive concerned 2009/38/EC, says any company with more than 1000 employees in the EEA, and at least 150 of them in two member states should establish a European Works Council. Consequently, when the UK leaves the EU, the dynamics of many of these EWCs will be affected.
The EU’s chief negotiator Michel Barnier has emphasised that concerns such as citizens’ rights should be prioritised so it may be some way down the line before we have more clarity on the future of EWCs. In the meantime, the management teams which organise the meetings, the employees who attend them and the interpreters who facilitate their discussions are all wondering what the outcome will be. The Unite union who has many members involved in EWCs has already held a conference dedicated to this issue.
Philip Sack, Director of European Employers Group has been advising companies on setting up and running European Works Councils and UK Information & Consultation arrangements since 2005. Given his unrivalled expertise on the legislative issues and contacts with EWC organisers, he is the ideal person to comment on the implications of Brexit.
In his view, post-Brexit, EWC legislation is unlikely to apply to the UK and this will have implications on works councils based throughout Europe namely:
- whether there is a continuing obligation to have a European Works Council
- the position of UK representatives on a European Works Council
- possible redistribution of seats on the EWC
- whether the governing law of the EWC will change.
Those most closely involved think that the UK government will find it difficult if not impossible to maintain the bulk of this unique legislation. However, for companies whose employee numbers are still above the threshold outlined – even without their UK colleagues – will still need to have an EWC agreement, so companies who have filed their agreement under UK law will need to take action. Agreements can be filed in any EU member state where the company has a presence, so they will need to be transferred, given the similarities in legal system; it seems that many will look to re-file in Ireland. Furthermore, Unite, General Secretary Len McCluskey has argued in favour of finding a solution where UK workers can still have a right to participate in EWCs after the UK exits from the EU. It would certainly be strange to have a situation where some employees may not be able to participate in a council where company strategy is discussed.
For companies where the UK’s withdrawal means they will fall below this threshold, there are perhaps employee relations and practical rather than legal questions on whether to continue. Given the value that the meetings hold for employees and managers to meet and share ideas, Mr Sack believes the likelihood is that many companies will continue to hold their annual or even bi-annual meetings. There is also the practical advantage that if a company subsequently expands in Europe and hits the employee threshold again in the future, there is no need to start from scratch with setting up the works council.
There may be a need to re-allocate the number and allocation of seats but although the UK representatives would not be required to attend, it is still possible with some minor re-wording of the agreement that they can participate as invited guests, or even as full members. Managers are less affected and can be invited from whoever countries are relevant as may guest speakers and industry experts. As the day-to-day operational team tends to be from management side, people are unlikely to want disruption and many will continue to operate in their existing systems.
In conclusion, while there may be some legislative issues, on the ground there is hope that should they choose to do so colleagues across Europe and the UK will be able to continue to communicate with each other for many years to come.