European Parliament calls for amendments to information and consultation Directive
In October 2001, the European Parliament voted to support a series of amendments to the draft EU information and consultation Directive, but a crucial amendment designed to strengthen the sanctions for non-compliance with the Directive did not receive the backing of sufficient MEPs to be adopted.
At its plenary session on 22-25 October 2001, the European Parliament (EP) adopted a range of amendments to the Council of Ministers' common position on the draft EU Directive establishing a general framework for informing and consulting employees in the European Community. The amendments seek to introduce more specific information and consultation requirements on employers and reverse concessions won by the UK and Irish governments when the common position was agreed by the Council in June 2001 (EU0106219F) (following this political agreement, the common position was formally adopted in July). Crucially, however, a proposal to strengthen the sanctions to be imposed for failure to comply with the Directive did not receive the backing of a sufficient number of MEPs to be adopted.
MEPs voted on a wide-ranging list of amendments proposed by the EP's Employment and Social Affairs Committee on 9 October 2001 in a report drawn up by the Italian socialist MEP, Fiorella Ghilardotti. The Committee's amendments sought to strengthen the Directive's requirements on employers and included proposals for stronger sanctions for non-compliance. The changes proposed by the Committee were welcomed by European and national trade union bodies but prompted criticism from employers' organisations. Willy Buschak, confederal secretary at the European Trade Union Confederation (ETUC), commented that adoption of the Ghilardotti report would 'remedy the weaknesses the common position of the Council still contains'. However, the UK employers' organisation CBI said the proposed amendments would be 'highly damaging' and vowed to lobby MEPs vigorously in a bid to get the proposed amendments dropped.
In a vote on 23 October, the EP endorsed the bulk of the Committee's proposals, in some cases with changes to their wording. However, although supported by a majority of those voting, three potentially significant amendments failed to receive sufficient votes to be adopted (EU rules require EP amendments to a common position to be adopted by an absolute majority of the 625 MEPs, ie by at least 313 votes in favour).
Most importantly - and against expectations - MEPs did not adopt an amendment which would have required Member States to provide more stringent sanctions where employers seriously breach their information and consultation obligations in respect of decisions which may lead to the termination of employment, and to provide for specific procedures allowing employees' representatives to obtain the suspension of decisions in such circumstances.
The EP also did not adopt amendments which would have:
- required Member States to prevent undertakings from reducing the size of their workforce or changing their structures with the purpose of depriving employees of the right to information and consultation; and
- shortened the period within which Member States must transpose the Directive into national law from three years after adoption, as specified by the Council's common position, to two years.
Nevertheless, the amendments the EP did adopt are potentially far-reaching and are intended to strengthen the Directive's requirements in a number of key areas. They include:
- adding a new 'recital' stating that Member States should take measures to guarantee that employees' representatives are elected by employees or designated by employees' organisations;
- adding a further new recital which says that 'more stringent, dissuasive penalties and specific judicial procedures applicable in the case of decisions taken in serious breach of the obligations under this Directive should be established' (despite the fact that the proposed amendment to the main body of the Directive which would have achieved this did not receive enough votes to be adopted);
- extending the definition of 'information' to include 'all relevant data' and to specify that it must take place 'before the decision is taken';
- specifying that consultation should take place 'during the planning stage of a decision in order to ensure the procedure is effective and to allow influence to be exerted on the decision-making process';
- adding that Member States must 'foster and promote social dialogue' in small and medium-sized enterprises not covered by the Directive;
- specifying that employee representatives should be informed about the undertaking's 'economic and financial situation ... in particular as regards investment, production, sales and structure as well as strategic plans, including changes to organisational structures and market developments';
- providing that 'if the implementation of a decision will have significant adverse consequences for employees, the final decision may be postponed for an appropriate period at the request of the employees' representatives so that consultations may continue with the aim of avoiding or mitigating such adverse consequences';
- specifying that negotiated agreements on information and consultation must meet the general objectives laid down by the Directive plus any conditions set by the Member States. Such agreements must be between the 'social partners' (rather than 'management and labour' as in the Council's common position). The term 'social partners' is defined to mean 'the competent representative trade union organisation, the employees' representatives, as provided by law, the employers' organisation and/or the employer';
- specifying that employees' representatives should have legal protection against being disadvantaged with regard to career, wages and training, and should have the right to paid training leave, to organise regular meetings among themselves and with all employees and to use the undertaking's internal computer networks;
- requiring Member States to 'examine in cooperation with the social partners appropriate ways in which the principles laid down in this Directive can be implemented in public administrations'; and
- deleting the transitional arrangements included in the Council's common position whereby Member States in which there is no 'general, permanent and statutory system' of information and consultation, nor of workplace representation, to delay applying the Directive to smaller undertakings.
During the debate in the EP, the Commissioner for Employment and Social Affairs, Anna Diamantopoulou, told MEPs that the Council's common position 'strikes a delicate balance between different points of view and divergent interests on the sensitive issues at stake. While I understand your desire to improve the text, it would be unwise, in my view, to depart now from that balance and jeopardise the actual adoption of the proposal.' She said that the European Commission was not prepared to accept the majority of the amendments put forward by the Employment and Social Affairs Committee, but signalled the Commission's support, in full or in part, for certain, relatively minor amendments, as well as its partial support for the proposed amendment, subsequently not adopted by the EP, seeking tougher sanctions for non-compliance.
The amendments adopted by the EP will now go forward to the Council and to the Commission, which will give its opinion on the amendments. The Council is highly unlikely to approve all the amendments supported by the Parliament and, under the co-decision procedure that applies to the Directive, this will mean that it will be referred a joint Parliament/Council conciliation committee which will have the task of reaching agreement on a joint text.
The current Belgian EU Presidency is said to be determined to secure agreement on a final text of the Directive before its term of office expires at the end of 2001. It seems likely that the conciliation procedure could be launched in the second half of November following the Commission's formal response to the EP's amendments and consideration of the EP's amendments by the Committee of Permanent Representatives (COREPER). A short conciliation stage might enable final adoption of the Directive by the Employment and Social Policy Council on 3 December and by the Parliament at its plenary session on 10-13 December. This, however, would be a very tight schedule. While observers expect the conciliation process to result in an agreed joint text under the current Belgian Presidency, it is possible that formal adoption by the EP and the Council may not take place until early in 2002 under the subsequent Spanish Presidency.
The failure of the key amendment on sanctions to be adopted by MEPs was reportedly due to a late change in position by the European People's Party, which had previously supported the amendment at the Committee stage, and pressure from a number of governments which either opposed the amendment in principle (eg the UK) or wished to facilitate rapid agreement at the conciliation stage (eg Belgium, France and Germany).
By not adopting the proposed amendment calling for more specific provisions on sanctions for non-compliance, the EP has effectively removed from the equation the issue which most commentators thought would be the most difficult to resolve at the conciliation stage. The conciliation process is now expected to be quicker and easier as a result.
One area where some compromise would appear to be necessary is on the timescale within which Member States currently without 'general, permanent and statutory' systems of information and consultation and workplace representation (ie the UK and Ireland) may phase in the coverage of the Directive's requirements. The Council's common position would enable such countries initially to apply the Directive only to undertakings with at least 150 employees (or establishments with at least 100 employees), extending coverage to undertakings with at least 100 employees (or establishments with at least 50 employees) two years later and to undertakings with at least 50 employees (or establishments with at least 20 employees) two years after that. Following the EP's rejection of this formula, it is possible that the conciliation process might result in shorter periods between each of these phases.
The EP's amendment designed to limit the scope for negotiated agreements to depart from the Directive's requirements appears highly unlikely to prompt any movement on the part of the Council. The wording in the common position on this point is a careful compromise, agreed only after lengthy negotiation, and observers do not expect EU ministers to be willing to accept any further changes.
Another key issue which European trade unions hope will be given priority in the conciliation process concerns the timing of information and consultation. Unions support the EP's amendments to the Council's common position specifying that information and consultation must take place before management decisions are taken. The nature of the Directive's final provisions in this area could have a major bearing on the eventual impact of the legislation in practice. (Mark Hall, IRRU)