Unions welcome progress on works councils

Date: 18/09/1997

ONE year after new EU rules on worker consultation came into force, trade unions remain guardedly optimistic even though more than half of the companies theoretically covered have not yet implemented the regulations.

The Works Council Directive was agreed by national governments in 1994 and came into force on 22 September last year. It lays down that companies which fall within its scope must set up information and consultation committees - known as works councils - to discuss issues of concern to management and employees, such as major staff lay-offs or factory closures, if asked to do so by the workforce.

The directive applies to multinational organisations employing more than 1,000 people across the EU with at least two branches with 150 staff each in two separate countries.

The European Trade Union Confederation (ETUC) estimates that some 1,200 firms are covered by the law and so far about 470 have established works councils. The vast majority of these bodies (around 440) were actually set up before the directive came into force, with only 30 or so being created subsequently.

But the ETUC is not unduly worried by this apparent slow-down. “We had a flurry of activity before September 1996. I just think people are taking some time to reflect on the issue,” said ETUC expert Willi Buschank.

He argues that most companies will probably wait until 1999, when a three-year consultation period for the directive expires.

The trade unions have already made it clear that they want the directive to be strengthened, citing carmaker Renault's shock decision earlier this year to close its profitable factory in Vilvoorde, Belgium to support their argument.

The ETUC claims Renault effectively ignored the worker consultation rules. But European employers' federation UNICE argues that the Renault affair proves that the directive has all the teeth it needs. They say rulings against the company in the French and Belgian courts and at the European Court of Justice demonstrate that its provisions are adequate.