| Author (Person) | Bower, Helen | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| Publisher | ProQuest Information and Learning | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Series Title | In Focus | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Series Details | 26.7.02 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Publication Date | 27/07/2002 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Content Type | News, Overview, Topic Guide | In Focus | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Companies across the European Union will have to consult their employees on any significant decisions in the future following the formal adoption of the EU Information and Consultation Directive [Directive 2002/44/EC] by the European Parliament and the Council of the European Union in February 2002. After three years of negotiation, the Directive will not enter into force for a further three years but when it does all undertakings across the EU employing more than 50 people will have to consult their workers about business developments, employment trends and changes in worker organisation. Background The idea for an EU wide framework for national-level information and consultation rules was first put forward in the European Commission's medium term social action programme [COM(95) 134 final] in April 1995. Renault's closure of its Vilvoorde car plant in Belgium in 1997 with the loss of 3000 jobs emphasised the need for new legislation to improve worker consultation. The French car maker ignored the European Works Council Directive and the Collective Redundancies Directive and failed to inform or consult representatives of the workers prior to its decision. Speaking about Renault's behaviour Padraig Flynn, the then European Commissioner for Employment and Social Affairs said:
He added:
In June 1997, in line with social policy agreement, the European Commission initiated the first phase of a consultation procedure with the social partners about the advisability of legislation in this area. Although the European Trade Union Confederation (ETUC) and the European Centre of Enterprises with Public Participation and of Enterprises of General Economic Interest (CEEP) supported the concept, the Union of Industrial and Employers' Confederations of Europe (UNICE) argued that EU-level action in this area was unwarranted. In UNICE's opinion an extensive framework of provision for worker information and consultation already existed at national and transnational levels. The European Commission made clear its preference for a social partner initiative to reach a European agreement on worker consultation when it opened a second consultation phase in November 1997. However, UNICE once again opposed the initiative and rejected joining negotiations in March 1998. Many observers suggested that UNICE's refusal was the result of strong opposition from its member organisations in Germany, Greece, Portugal and the UK, which felt that there was already provision in the form of the European Works Council Directive and any further legislation went against the principle of subsidiarity. European Commission tables a draft Directive With the ETUC still calling for a framework agreement in this area, the European Commission tabled its proposal for a Directive establishing a general framework for informing and consulting employees in the European Community [COM(98)612 final] on 11 November 1998. The proposal offered a significant degree of flexibility in relation to the exact shape and scope of information and consultation arrangements but did stipulate that it should apply to undertakings with at least 50 employees. Estimates at the time suggested this would apply to 3% of European enterprises and 58.25 of European employees. Padraig Flynn presented the proposal to the Labour and Social Affairs Council on 2 December 1998. However, it was not to proceed much further with the Council during the course of 1999 with the German Presidency excluding it from their agenda during the first six months and the Finnish Presidency prioritising the proposal on the European Company Statute in the latter half of the year. The European Parliament did debate the proposal in 1999 with MEPs giving it their approval at their first reading of it in April 1999 but with a number of amendments. In June 2000, the Portuguese Presidency initiated official level discussion of the proposal at a meeting of the Council's social working group. The momentum was then taken up by France during the second half of 2000 with several discussions taking place in the working group, CORPER and the Employment and Social Policy Council. However the French Presidency was unable to secure an agreement at the Council meeting on 27-28 November 2000. The United Kingdom, Germany, Ireland and Denmark all expressed reservations about the draft Directive but for different reasons. The UK vehemently opposed the proposal on the basis it went against the principle of subsidiarity and was a disproportionate response to the behaviour of Renault. Germany's reservations were believed to represent a political agreement with the UK and also a reflection of their priority to finalise the European Company Statute. Denmark and Ireland expressed their preference for collectively agreed consultation agreements. After intense efforts by the Swedish Presidency during the first half of 2001 ministers meeting for the Employment and Social Policy Council in June of that year successfully reached a political agreement on a common position. However, the European Parliament put forward a series of amendments to this common position in October 2001 and so the proposal entered the conciliation stage. Following discussions between the Parliament, the Council and the Commission the latter put forward a compromise proposal on 30 November 2001. Representatives met from the three institutions on 5 December 2001 and approved this compromise proposal. This political agreement was adopted unanimously by the full 30 strong conciliation committee on 17 December 2001 and duly adopted by the European Parliament and Council in February 2002. After three years of difficult negotiations, the proposal was adopted at a time when two other large companies, Danone and Marks and Spencer, had just announced a comprehensive restructuring plan with the possibilities of large numbers of redundancies. The compromise proposal sought to prevent this in the future by:
In order to win the support of the UK and Irish governments the proposal also provided the UK and Irish governments, which have no history of consultation, with a transitional period of five years for SMEs with 100 employees and six years for those with 50 employees Reaction to the Proposals After such a long period of negotiations, the adoption of the proposal was welcomed by the European Trade Union Confederation (ETUC). Emilio Gabaglio, the president of the ETUC, said:
The Trade Union Congress in the United Kingdom echoed ETUC's support of the proposal saying:
Even the Confederation of British Industry, one of the staunchest opponents to the proposal appeared fairly satisfied with the final conciliation agreement. In a press release, it recognised that the UK government had successfully prevented European Parliament proposals from succeeding. Future of Workers' Information and Consultation Directive The adoption of the Workers' Information and Consultation Directive has been widely heralded as a landmark in EU social policy. However, the Directive must still be implemented at the national level. Many question whether the Directive will have much effect in practice particularly in the United Kingdom and Ireland where there is no history of worker consultation. Many believe that an EU law which extends Franco-Belgian standards of social protection to the rest of the EU is not enough to guarantee that workers will require prior information of proposed job losses, that would require a real change in corporate thinking on the rights of workers. The adoption of the Directive completes one of the EU's most important social policy dossiers, a number of other European Commission initiatives such as proposals on EU-level dispute resolution mechanisms and the EU takeover Directive mean that employment issues are likely to remain high on the EU agenda. Further information within European Sources Online:
Further information can be seen in these external links: EU Institutions Further and subsequent information on the subject of this In Focus can be found by an 'Advanced Search' in European Sources Online by inserting 'worker consultation' in the keyword field. Helen Bower Companies across the European Union will have to consult their employees on any significant decisions in the future following the formal adoption of the EU Information and Consultation Directive [Directive 2002/44/EC] in February 2002. |
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| Subject Categories | Employment and Social Affairs | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
