UK government rallies opposition to worker consultation proposals

Date: 29/10/1998

By Simon Coss

NEW European Commission plans to bolster the rights of workers in firms operating in only one EU country could be scuppered by member states, amid signs that several of them are planning to join forces to try to sink the proposals.

The UK is leading the charge against the new initiative, which is set to be unveiled after next Wednesday's (4 November) Commission meeting.

London argues there is no need for EU legislation to ensure the right of workers to be adequately consulted when their employers are planning major restructuring initiatives - such as mass redundancies - if the company involved is based in just one member state.

"We do not believe that in this particular case it is necessary to take action at European level. We do not think such a move is compatible with the principle of subsidiarity," said one British official, referring to the principle that decisions should be taken at the lowest level of administration possible.

European employers' federation UNICE used almost exactly the same argument when it announced last month that it did not want to sit down with the other EU social partners, the European Trade Union Confederation (ETUC) and the public sector employers CEEP, to draw up a draft directive on 'worker information and consultation in national companies'.

When the issue was put to the vote among UNICE's 17 member federations, six of them, from the UK, Germany, Portugal, Greece, Sweden and Italy, are understood to have opposed talks. UNICE's refusal to negotiate triggered the Commission's announcement that it would bring forward its own proposals.

The UK claims that its opposition to the Commission's plan is likely to be supported by some, if not all, of the countries whose employers' federations voted 'no' in the UNICE poll. If that is the case, then it might be able to muster enough votes to block the proposal, which must be approved by qualified majority vote to become law.

However, the Commission disputes the UK premise that governments are likely to follow the lead set by their employers' organisations.

Barbara Nolan, spokeswoman for Social Affairs Commissioner Pádraig Flynn, pointed out that the vast majority of EU member states already had in place laws or statutory agreements between employers and trade unions guaranteeing workers' rights to adequate consultation. Only the UK and Ireland have no such binding rules. "The bulk of member states have nothing to fear from this directive," she insisted.

Under Flynn's proposal, the new regulations would apply to all companies which employ more than 20 people, bringing only around 3% of firms but 68% of employees within its scope. The proposals include "effective and dissuasive" penalties which could be imposed on employers who fail to consult their workers adequately, including the possibility of declaring certain decisions invalid.

But it is not yet clear whether the proposal will be adopted in its current form by the full Commission.

Several of Flynn's colleagues have reservations about the plan, with Trade Commissioner Sir Leon Brittan understood to be among those voicing concerns about subsidiarity, together with fears that it could damage the competitiveness of European companies and would be very difficult to enforce in practice.