Act establishing works councils to be enacted

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The legislative Act on works councils is to be considered by the upper chamber of the Polish parliament, after its adoption by the lower chamber in March 2006. The new statute complies with the European Parliament and Council Directive 2002/14/EC, establishing a general framework for information and consultation with employees.

Having been adopted by the lower chamber (Sejm), the new statute on works councils will be considered by the upper chamber of the Polish parliament (Senat) in the next step of the legislative process. The Senat may either endorse the bill as presented by the Sejm or introduce amendments. It then passes the bill to the President for his signature – the final step required for passing an act into Polish law. Provided that the Senat does not make many amendments to the legislative Act on works councils, the final text of the statute should be published in the Journal of Laws by late 2006.

Criteria for setting up works councils

According to the draft statute approved by the Sejm, works councils are to be established in enterprises employing more than 50 people. By 23 March 2008, the works councils should be in place in enterprises employing between 50 and 100 people; the deadline for instituting councils in larger enterprises – of more than 100 employees – has been fixed at one year earlier, 23 March 2007. The works councils are to consist of between three and seven members. In addition, the statute sets their period of office at four years, for the duration of which the council members will benefit from protection against dismissal (along similar lines to that extended to union leaders). Moreover, the employer will be legally obliged to present its works council with information concerning the operations and the financial condition of the company. Employers must also consult with the council regarding proposed changes to the employment structure and work organisation. Uncooperative employers will face criminal penalties.

Applications to the works councils may be submitted by trade unions; where trade unions fail to agree on the composition of the council, its members would be elected directly by employees. In cases where enterprises have no trade unions, the works council will be convened by electing candidates nominated by employees. If a union is established in a company after elections for the works council have already been held, then the existing council is disbanded and the union is asked to establish a new one.

Delay in implementing EU Directive

Poland has benefited from a postponement of the deadline for implementing the EU Directive 2002/14/EC establishing a general framework for information and consultation with employees. This was due to the fact that laws providing for the information and consultation rights of trade unions had been dispersed in many different legal instruments and did not amount to a cohesive system conforming with EU standards. Even with this respite, the implementation is already one year behind schedule (it was supposed to be completed by 23 March 2005). To a large extent, this delay is the result of difficulties in reaching agreement among the social partners.

The unions took the position that a hasty, ill-considered implementation of the Directive might undermine their strength since they have enjoyed exclusivity with respect to information and consultation tasks until now. The employers, meanwhile, were reluctant to yield any more power to the unions. At the same time, they also feared that the creation of new forms of employee representation would increase their business costs and threaten the confidentiality of sensitive information pertaining to the operation of their enterprises.

Another significant point of contention was the employment level above which a works council would become mandatory. The unions proposed to set the threshold at five employees, the government proposed a threshold of 20 employees, while the employer organisations proposed a threshold of 50 employees. In the end, the employer proposal prevailed, and the possibility of appointing a workforce representative in enterprises with less than 50 employees was abandoned.

Commentary

As it stands, the draft statute represents the outcome of an uneasy compromise, and has attracted some criticism in the lower chamber of parliament. The Civic Platform (Platforma Obywatelska, PO), an opposition party, proposed a number of amendments, but these were rejected in a vote. Prior to the vote, the Vice Minister of Labour and Social Policy, Robert Kwiatkowski, emphasised that, ‘this draft is one of the few examples where social dialogue was operational in Poland’ and argued that, as such, it should be adopted. However, considering the difficulties that had to be surmounted up to this point, one would expect that the works councils law – provided, of course, that it is enacted – will soon be subject to amendment.

Jacek Sroka, Instytut Spraw Publicznych

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