UK implements European Works Councils Directive

Regulations to implement the European Works Councils Directive in the UK came into force in January 2000. Following consultations on draft Regulations published in July 1999, the government made a number of changes to its original proposals.

The UK's Transnational Information and Consultation of Employees Regulations 1999 were laid before parliament on 14 December and came into force on 15 January 2000 - one month later than the implementation deadline specified in the 1997 Directive which applied the requirements of the original 1994 European Works Councils (s) Directive to the UK.

The Regulations, made under section 2(2) of the European Communities Act 1972, take the form of a statutory instrument (SI 1999/3323). The Regulations required the formal approval of parliament under a procedure whereby the Regulations were subject to annulment by negative resolution of either House (the Commons or Lords) within 40 days of being laid before parliament.

The coming into force of the Regulations represents the final step in the reversal of the previous UK government's "opt-out" from the 1994 EWCs Directive. In July 1999, the current Labour government initiated a three-month consultation exercise on draft Regulations (UK9907220F), during which employer and trade union organisations argued for modifications to various provisions. The final version of the Regulations includes a number of changes from the draft Regulations. Among other amendments:

  • the government has qualified its initial proposal that UK members of special negotiating bodies (SNB s) must be elected by workforce-wide ballot by providing that, where there exists a consultative committee whose members have been elected by all UK employees of the company or group, its members are entitled to nominate the UK members of the SNB from among their number;
  • the Regulations now provide that, in addition to one SNB seat for each member state of the European Economic Area (EEA) in which a company or group operates, one, two or three additional seats will be allocated to member states with 25%, 50% and 75% of the company's total EEA workforce respectively. This is the formula recommended by the European Commission-convened transposition working party and adopted by most other member states, and replaces the variant originally proposed in the draft UK Regulations; and
  • the proposal in the draft Regulations that it should be a criminal offence for SNB/EWC members etc to disclose information provided to them in confidence by management has been dropped. The final Regulations rely instead on civil remedies for breach of statutory duty.

The Regulations provide that, where companies whose central management is in the UK have concluded an "Article 6" agreement with an SNB under the law of another member state before the UK legislation took effect, it may be made subject to the UK Regulations with the consent of the parties. In the case of companies whose central management is in the UK but are party to continuing SNB negotiations which were started under the law of another member state prior to the entry into force of the UK Regulations, the negotiations will now become subject to the UK Regulations but will maintain their original timetable.

The Department of Trade and Industry (DTI) estimates that the introduction of the UK Regulations will roughly double the number of UK-based companies subject to the requirements of the EWCs Directive - with about 100 UK companies being newly brought within scope as a result of the inclusion of UK employees in the application of the Directive's workforce-size thresholds.

Commenting on the final Regulations, the DTI minister responsible, Alan Johnson, said in a statement: "The approach we have taken is flexible ... It is important that employers and employees work out constructively what sort of arrangement will be best for them and work together in a spirit of partnership to achieve it, without getting bogged down in the mechanics."

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