Thematic feature - works councils and other workplace employee representation and participation structures

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This article examines the Luxembourg situation, as of September 2003, with regard to works councils and similar workplace employee representation and participation structures. It looks at the regulatory framework, statistical data, evidence on practice and the views of the social partners.

The issue of works councils and similar workplace employee representation and participation structures is topical at present, with the EU Member States required to implement the recent Directive (2002/14/EC) establishing a general framework for informing and consulting employees in the European Community (EU0204207F) by March 2005 (though countries which currently have no 'general, permanent and statutory' system of information and consultation or employee representation may phase in the Directive's application to smaller firms up until 2008). The Directive applies to undertakings with at least 50 employees or establishments with at least 20 employees (the choice is left to the Member States). It provides employees with the following rights to information and consultation:

• information on the recent and probable development of the undertaking's or the establishment's activities and economic situation;

• information and consultation on the situation, structure and probable development of employment within the undertaking and on any anticipatory measures envisaged, in particular where there is a threat to employment; and

• information and consultation, with a view to reaching an agreement, on decisions likely to lead to substantial changes in work organisation or in contractual relations.

Information and consultation arrangements set out in agreements between management and labour, including at undertaking or establishment level, may differ from those laid down in the Directive.

While the Directive does not stipulate that information and consultation must be provided through any particular channel or structure, it defines such information and consultation as taking place between the employer and the employee representatives provided for by national laws and/or practices. It is these representatives, who in most EU Member States sit on standing 'works council'-type structures (and in many countries already enjoy all or most of the information and consultation rights laid down in the Directive) that are the focus of this article. The existence of workplace employee representation and participation structures, based on law or widespread collective agreements, is seen in some quarters as a distinctive and important feature of the (mainland) European industrial relations model. Indeed, the idea has been raised of using the coverage of such worker involvement arrangements as an indicator of 'quality' in industrial relations (as suggested, for example, by the European Commission’s June 2001 Communication on Employment and social policies: a framework for investing in quality).

In this context, in September 2003, the EIRO national centres in each EU Member State (plus Norway), were asked, in response to a questionnaire, to provide information about the current situation with regard to national (rather than European level) works councils and similar bodies – the regulatory framework, statistical data (or estimates where not available), evidence on practice and the views of the social partners. The Luxembourg responses are set out below (along with the questions asked).

Regulation

What is the legislative framework in your country concerning works councils and/or other workplace employee representation and participation structures? Please include here: definition; workforce-size threshold for establishment; composition/election; subjects for information, consultation and co-determination; conditions under which information, consultation and co-determination should take place (ie timing, methods, contents, level of representation, type of response by employees, form of interaction etc); meetings; confidentiality; protection of employees’ representatives. If there is no legislation on this issue in your country, please refer to widespread systems of works councils etc based on collective agreements.

There are two main statutory structures for workplace employee participation and representation in Luxembourg - the employee committee and the joint works committee.

Employee committees

Under the law of 18 May 1979, all organisations regularly employing 15 workers under a contract of employment must arrange for the election of an employee committee (délégation du personnel). The committee is made up of employee representatives elected every five years by the workforce, with their number varying according to the number of employees represented. In larger companies, separate elections are held among blue- and white-collar workers. Elections are on the basis of lists of candidates presented by trade unions or a certain number of employees. Employee committees are establishment-based and multi-establishment companies must set up a central committee (délégation centrale).

The main function of the employee committee is to protect employees' rights and interests through its rights of information and consultation. It has the rights to:

• formulate and present opinions on all issues relating to the improvement of employees' working conditions, terms and conditions of employment and social rights;

• present individual and collective complaints to the employer;

• seek to prevent and resolve any disagreements arising between the employer and the workforce and, in the event of non-compliance with regulations, enlist the assistance of the relevant authorities;

• present opinions on the management of the enterprise and monitor the application of, and propose amendments to, the works rules;

• participate in the definition and implementation of the rules governing the employment of apprentices;

• make proposals with respect to the re-employment of victims of industrial injuries, disabled workers etc;

• participate in the management of the company welfare facilities;

• help to prevent accidents at work and occupational illnesses (through the appointment of special safety representatives);

• be consulted when the employer is contemplating the creation of part-time jobs;

• receive information on the enterprise's economic situation;

• in joint-stock companies, receive detailed accounts on the company's financial and economic situation at least once a year.

Since a law of 7 July 1998, company management has been obliged to provide the employee committee with regular statistics, disaggregated by gender, relating to staff recruited, promotions, transfers and dismissals, and the pay and training of the workforce. The employee committee also nominates the members of the joint works committee (see below).

The committee meets at least six times a year, and the establishment's manager may be invited to take part in its proceedings. Committee members enjoy special protection against dismissal, and may only be dismissed by the Labour Tribunal (Tribunal du travail).

Joint works committees

The law of 6 May 1974 provided for joint works committee s (comités mixtes d'entreprise) made up of equal numbers of employer’s representatives and employee representatives in all private sector enterprises employing 150 workers (over a reference period of three years). The employee representatives are appointed by the employee committee (see above).

The joint works committee has:

• co-determination rights over company policy on recruitment, promotion, transfer and dismissal, employee appraisal, works rules, health and safety matters, and the use of equipment to monitor employee performance;

• information and consultation rights over management decisions on technical changes, working methods and the work environment, current and forecast labour requirements, vocational training and retraining, and the enterprise's economic and financial position, including an obligation on the employer to provide it with information, at least once a year, on levels of pay; and

• the right to monitor and keep a check on company welfare facilities, such as company housing.

The law of 7 July 1998 requires joint works committees, in the performance of their duties, to ensure rigorous compliance with equal treatment for women and men in respect of access to jobs, vocational training and promotion, and pay and conditions of employment.

Management must call a meeting of the joint works committee at least once a quarter, and whenever at least a quarter of the representatives so request. Joint works committee members enjoy the same protection against dismissal as employee committee members.

Other provisions

Beyond workplace level representation, under the law of 6 May 1974, employees have representation on the boards of companies which are more than 25% state-owned or which receive state aid for their main business, and of all companies with more than 1,000 employees (TN9809201S). In the latter companies, employee representatives have one-third of the seats on the board of directors, and no fewer than three members. In companies with state involvement, there is one employee representative for every 100 employees with a minimum of three employee representatives and a maximum of one-third of the total board. Employee committees appoint board representatives from among the company's workforce, with proportional representation of both blue- and white-collar workers. In the iron and steel industry, the most representative national trade unions directly appoint three of the board representatives, who need not be company employees.

The law of 28 July 2000 (LU0101157F) implemented the EU European Works Councils Directive (94/45/EC). It provides for a range of statutory employee information and consultation rights concerning transnational issues in multinational companies.

Statistics

Please provide the most recent available statistics (in absence of statistics please provide estimates referring to sources) on the following (referring to other workplace employee representation and participation structures where works councils are not present and to widespread collective agreements on the issue where there is no legislation):

• the total number of employees and undertakings/establishments in your country;

A total of 23,194 companies liable to pay VAT were recorded by the Central Statistical and Economic Research Centre (Service Central de la Statistique et des Études Économiques, STATEC) on 1 January 2002. In 2002, there was a total of 268,800 employees, again according to STATEC.

• the total number of undertakings/establishments covered by the works councils legislation in your country and their total employment (data should be as much as possible disaggregated by gender, company size and sector);

No accurate figures are available.

• the total number of undertakings/establishments in your country which have established works councils and their total employment (data should be as much as possible disaggregated by gender, company size and sector).

Please provide any other national data indicating the number/diffusion of works councils.

About 2,200 companies have an employee committee (according to the Labour and Mines Inspectorate, Inspection du Travail et des Mines), and there are almost 2,500 employee committees in total. In 1998, the last elections to employee committees were held, nearly 145,000 workers were eligible to vote. About 200 companies have a joint works committee (according to the Labour and Mines Inspectorate). Some 15 enterprises fall within the scope of the legislation on board-level employee representation, and all are thought to have such representation. Finally, three Luxembourg-based multinationals fall within the scope of the EWCs legislation.

Practice

If there are any other statistical sources or recent research on the current practice of works councils or other workplace representation/participation bodies, please give details of the results paying attention to the issues covered by Question 1 (Regulation). Please provide as much quantitative data as possible - eg how many meetings and how often, chair, agenda, composition (eg how many representatives of management, if any, workers, proportion of women members, proportion of women as head of works councils etc) and identify factors of success. Please indicate how the works councils (or works council-type bodies) institution has evolved over the years.

There are no statistics or research available on the practice of employee committees and joint works committees. Their number is thought to have steadily since their introduction. At the most recent elections to employee committees in 1998 (LU9812185N), lists presented by the two main trade union confederations won the overwhelming majority of seats, with the Luxembourg Confederation of Independent Trade Unions (Onofhängege Gewerkschafts-Bond Lëtzebuerg, OGB-L) ahead of the Luxembourg Confederation of Christian Trade Unions (Lëtzebuerger Chrëschtleche Gewerkschafts-Bond, LCGB). The next elections will take place in November 2003.

Social partners

Please summarise the views of trade unions on works councils etc and their operation, and outline relations between works councils and trade unions.

Please summarise the views of employers’ organisations on works councils etc and their operation.

Employee committees and joint works committees seem to be well received and used both by trade unions and employers, and they often serve as the starting point for collective bargaining - most of Luxembourg's 250-300 collective agreements are concluded at company level. The various representation structures do not seem to be an issue of major controversy between the social partners, although a number of issues continue to give rise to disagreement (LU0011149N). (Marc Feyereisen)