Poland: The effect of the Information and Consultation Directive on Industrial Relations in the EU Member States five years after its transposition

  • Observatory: EurWORK
  • Topic:
  • Participation at work,
  • Labour and social regulation,
  • Industrial relations,
  • Published on: 18 January 2011



About
Country:
Poland
Author:
Adam Mrozowicki
Institution:

Disclaimer: This information is made available as a service to the public but has not been edited by the European Foundation for the Improvement of Living and Working Conditions. The content is the responsibility of the authors.

The Act on the Information and Consultation of Employees (the I&C Act), enacted in Poland on 7 April 2006, created a new institution in Polish industrial relations, i.e. the works councils (rady pracowników). Four years after, the overall effect of the I&C Act on broadening of the scope of information and consultation available to employees is debatable. Works councils were founded only in 9% of companies covered by the I&C Act. They exist mostly in unionised enterprises (69% of all cases). If there is no strong trade union and favourable board to support their operations, their information and consultation prerogatives are usually limited.

Question 1: Trends in the incidence of undertaking- and/or establishment-level information and consultation bodies

(a) Using official statistics where possible, please provide annual data for the years 2005-2009 (inclusive) on the number and proportion (%) of undertakings and/or establishments which have an information and consultation (I&C) body or equivalent.

Since the Polish legislator made use of the transitory period, conditionally allowed by the EU Directive 2002/14/EC, works councils (rady pracowników) initially had to be established in companies that employed over 100 workers (around 17,000 enterprises). In January 2008, there were also 4,052 cases, in which employers and employee representatives concluded agreements that specified other ways of providing information and consultation than via works councils (based on Article 24 of the I&C Act). From 23 March 2008, when the transitory period ended, the Act began to apply to all companies employing 50 and more workers. According to the data from December 2008, there were 34,123 companies meeting this criterion.

Table 1. The number of works councils

Year

Number of works councils

Proportion of the enterprises covered by the I&C Act which had works councils

Proportion of the enterprises covered by the I&C Act having works councils or their equivalent

1 March 2007

1900

11%

34%

1 April 2008

2120

6.4%

18%

31 March 2009

2895

8.5%

20%

30 November 2009

2915

8.5%

20%

31 May 2010

3048

8.9%

20%

Source: Ministry of Labour and Social Policy (Ministerstwo Pracy i Polityki Społecznej, MPiPS). No earlier data available.

(b) Where possible, please provide data to show trends in the uptake of I&C bodies by:

(i) size of undertakings/establishments in terms of employment levels (i.e. under 50 employees, 50-99 employees, 100-199 employees; 200-499 employees, 500 or more employees or other appropriate size bands used in national statistics)

(ii) sector (broadly defined, i.e. industry/manufacturing, private services, public services).

The proportion of enterprises of different size, in which works councils were established, can be computed from the statistics on the number of employees in works councils which depends on company size. However, since the number of works councils members can also be determined by an organisation-specific agreement, in some cases, the size of the enterprise cannot be reconstructed based on the official statistics.

Table 2. Works councils by size of enterprise
 

50-250

251-500

501 and more

Unspecified

31 March 2009

1866

464

425

140

31 May 2010

1978

491

438

141

Source: Ministry of Labour and Social Policy (Ministerstwo Pracy i Polityki Społecznej, MPiPS)

There is no data on the sectors in which works councils were established.

(c) Please provide information on the extent of I&C arrangements in:

(i) smaller undertakings (those with fewer than 50 employees)

(ii) public administration.

Public administration as well as smaller enterprises (with fewer than 50 employees) are excluded from the I&C Act. In public administration, information and consultation proceeds mostly via the trade union channel. In smaller companies, information and consultation is often provided in direct contacts between employees and employers.

(d) What factors explain any increase/decrease in the incidence of I&C bodies (e.g. economic climate, legislative change, other)?

The end of the transitory period in March 2008 contributed to a growth in the number of works councils, as they had to be founded also in the companies employing more than 50 workers. However, it also led to a decrease in the coverage of works councils, since the number of companies, to which the I&C Act applied, increased. It was also noted that the number of agreements regulating information and consultation in other ways than via works councils sharply increased right before the adoption of the I&C Act. It was interpreted as the way to by-pass the statutory regulations by some employers and trade unions.

Question 2: Procedures for establishing I&C bodies

(a) What are the procedures for establishing I&C bodies in your country? For example, are I&C bodies mandatory (i.e. employers are obliged by law to establish them), or is their establishment dependent on employees/trade unions triggering statutory procedures? In the latter case, who can initiate the procedure? Is there a specified level of employee support required?

According to the I&C Act, the works councils are mandatory in the companies employing more than 50 employees, except for (1) the state-owned enterprises in which an employee board level representation exists, based on the Act on State-owned Enterprise of 1981; (2) enterprises with mixed capital (public-private) employing at least 50 employees, (3) state-owned film enterprises.

The proposal to establish works councils should be made in writing to an employer by at least 10% of employees. Under the original I&C Act, in unionised workplaces works councils’ members were to be appointed by trade unions (in consensus). If there were no trade unions in the company, they were to be elected ballot by all employees. On 1 July 2008, the Constitutional Tribunal ruled the regulations of the I&C Act on the elections system in the part concerning unionised workplaces unconstitutional, due to the fact that the incriminated regulations effectively denied the non-members of the company-level trade unions any say on the make up of works councils. For that reason, the Act had to be amended in May 2009 by revoking the articles infringing on the Constitution. The new ruling determines that candidates for works councils members may be proposed by a group of at least 10 employees and are to be elected in general ballots (in companies employing less than 100 employees) or at least 20 employees (in larger companies). The new rules apply to works councils’ elections in 2010.

(b) Please supply any available data on the extent to which I&C bodies have been:

(i) requested by employees

(ii) requested by trade unions

(iii) initiated unilaterally by employers.

As of 31 May 2010, there were 2108 works councils (69%), which had been established in the unionised companies upon request of trade unions. At the same time, there were 940 works councils (31% of the total), which had been founded in non-unionised companies. Qualitative research by Bednarski (2010) demonstrated that in non-unionised firms the initiative to establish works councils often came from employers.

(c) Have the national government and/or the social partners in your country actively promoted the establishment of I&C bodies? If so, how have they done this?

Works councils are systematically promoted by a non-governmental think-tank, the Civil Affairs Institute (Instytut Spraw Obywatelskich, ISO) within ‘The Support Centre for Works Councils project ’, co-financed by the Polish government and the European Economic Area funds. The project made it possible to provide training and secure legal advice for almost 500 works councils’ members. In 2009, the Independent and Self-Governing Trade Union ‘Solidarity’ (Niezależny Samorządny Związek Zawodowy ‘Solidarność’, NSZZ Solidarność) carried out another project co-financed from the European funds. It led to the establishing of 16 regional info points, in which trade unionists and all employees could get information on works councils and prepare for the first general elections to works councils in 2010.

(d) What explains the absence of I&C bodies in some undertakings/ establishments in which I&C bodies are supposedly mandatory or the statutory right to trigger their introduction applies?

The absence of I&C bodies can be explained by several factors. First, since employers are not obliged to trigger the procedure of establishing works councils, they do not consider their creation a part of their duties. Secondly, the initiative to establish works councils has to come from 10% of employees in a company, the threshold of 10% being an important organisational and psychological impediment in founding of an I&C body. Other important factors are limited information of employees on the procedures of establishing works councils and the reluctance of some employers toward any kind of employee involvement.

Question 3: Constitutional provisions

(a) Are the structure, rights and functioning of I&C bodies in your country determined by:

(i) statutory requirements that apply to all establishments/undertakings

(ii) organisation-specific agreements/arrangements that may differ from the statutory provisions, providing the scope for organisations to vary the design of the I&C body and the processes of information provision and consultation

(iii) a mixture of the two.

A mixture of two solutions applies. The general structure, rights and functioning of I&C bodies are determined by statutory requirements. However, article 5 of the I&C Act gives way to organisation-specific arrangements. As for 31 May 2010, organisation-specific arrangements were concluded in 1108 (36%) enterprises in which works councils existed.

(b) To what extent can and do organisation-specific agreements/arrangements differ from national statutory requirements on I&C? What motivates the parties to introduce such agreements/arrangements? Please summarise any available data on the provisions of organisation-specific agreements/arrangements.

Organisation-specific arrangements regulate issues, which were left open by the legislator, for instance the exact scope of information about the company situation provided by employer and the exact procedures of consultation. If no organisation-specific arrangements are concluded, the actual functioning of works councils is impeded. However, it was also observed that in many cases agreements decreased the prerogatives of works councils as compared to statutory requirements. As documented by Okraska’s report (2007), this included the limitation of the scope of information provided to works councils, constraints on information-sharing with employees and restrictions on hiring independent experts.

(c) Are the terms of organisation-specific agreements/arrangements enforceable? What procedures – e.g. complaint to external administrative or judicial authorities (please specify which) – are available for this purpose?

In case of organisation-specific arrangements the same compliant procedures apply as in the case of statutory arrangements. A complaint can be lodged by employees to the National Labour Inspectorate (Państwowa Inspekcja Pracy, PIP), which represents them in court.

Question 4: The main subjects for I&C

(a) What types of information are regularly provided by senior management to I&C bodies? Please give examples.

As illustrated by Portet’s research (2008), works councils typically have access to information on the legal status and organisation of companies, size of employment, profit and loss accounts and economic forecasts of the company. The least available information concerns capital transfers between dominant company and dependent companies, business operations among companies, outsourcing of a part of business operations to external companies and changes in work organisation.

(b) What issues are typically the subject of consultation between management and employee representatives? Please give examples.

A limited number of case studies analysed by Bednarski (2010) indicates that consultation concerns wages, work regulations and employment-related issues. However, it takes place only in a limited number of companies and rarely leads to formal agreements.

(c) What issues are typically raised by employee representatives themselves? Please give examples.

No information available.

(d) Since the onset of the recession, to what extent have I&C bodies been a vehicle for dialogue and consultation over management decisions concerning restructuring and recession-related developments? Please provide a general overview with evidence and examples.

There is no data on the extent of the involvement of works councils in the social dialogue during recession. An example of good practice might be the Żywiec Group (Grupa Żywiec), in which a joint body of six company trade unions created already in 1997, plays the role of a works council (based on Article 24 of the I&C Act). In the wake of a crisis, the meetings of the joint union representation with the board of directors intensified and became the main vehicle of social dialogue in the company, which helped sustain wage increase despite difficult situation.

Question 5: The nature and extent of the I&C process

(a) How often do I&C bodies typically meet with management? Is it common practice for special meetings of the I&C body to be called to consider urgent or important matters? If so, on what issues?

The frequency of meetings between works councils and management can vary from twice per year to once per month. As documented by Bednarski’s study (2010), there were cases, in which works councils were ‘activated’ only in the wake of deep organisational changes, when the management attempted to reach employees and reassure them.

(b) How does consultation take place? For example, is information on proposed changes provided by management so that employee representatives can prepare a considered view? Do managers provide a reasoned response to employee representatives’ opinions? Examples of good and poor practice would be helpful.

Research by Portet (2008) suggested that 54% of works councils representatives had not been denied the right of consultation by employers. However, in-depth case studies led to a conclusion that in many of these cases actual consultations did not take place. On the other hand, Bednarski (2010) analysed a limited number of cases, in which cooperation between management and works councils led to joint agreements on pays, bonuses or work regulations.

(c) Is information usually provided on a confidential basis to the I&C body before management decisions are taken and announced? Are there examples of I&C not taking place due to confidentiality considerations?

The situation is varied. On the one hand, the issue of confidentiality does not constitute a major problem for the activity of works councils because they rarely demand sensitive business information. On the other hand, there are well-documented cases of the Factory of Motor Cars (Fabryka Samochodów Osobowych, FSO) and Alima Gerber, where information on the costs of the employment of temporary workers (in case of FSO) and salaries, the size of production and economic forecast was denied to works councils due to confidentiality considerations (PL080429I).

(d) Please outline what guarantees and protections employee representatives usually have, e.g. time off work, training, material and financial resources, facilities, protection against dismissal/ discrimination, access to workers.

According to the I&C Act, works councils’ members are protected against dismissals and worsening the terms of their contracts during the term of their office. They also have the right to be released from work to perform their duties retaining their regular remuneration. Since May 2009, employers should cover the costs of works councils’ operations (earlier, the costs in unionised workplaces had to be covered by the unions). In practice, according to the study by Portet (2008), 40% of works councils had their own offices, 31% had their own computer, 54% had access to a phone line and 75% obtained regular pays for their activities in works councils.

(e) Can employee representatives seek external advice on how to handle difficult topics for consultation (e.g. from trade unions, external consultants)? In the case of the latter, who pays?

Article 25 of the I&C Act enables works councils to seek advice from external experts. Since May 2009, the costs of such expertise should be covered by employer. The study by Portet (2008) showed that 91% employee representatives considered external advice ‘necessary’, but only 11% works councils had special budget to pay external consultants. Only 46% employers agreed to pay for consultants in organisation-specific agreements, while 53% provided such support on an ad-hoc basis.

Question 6: Practical outcomes of consultation

(a) What evidence is there, if any, of the consultation process resulting in the modification of management decisions and/or the process or timetable for their implementation? Please give an overview of the impact of consultation with examples.

There is no direct evidence of the impact of consultation in the existing studies. Consultation procedures are generally less developed than information practices. According to the study carried out by NSZZ Solidarność on 11 companies in the metal sector (Matla, 2008), ‘the involvement of works councils in the process of management change has been so far very limited’ and particularly weak in non-unionised companies.

(b) How many complaints per year concerning the operation of I&C procedures (e.g. employers not consulting in circumstances where consultation is obligatory) have been lodged with administrative or judicial authorities since 2005? Who were the claimants and what were the key issues? What proportion of these applications were upheld? What sanctions were imposed?

There is no recent data on the number of complaints per year lodged with the National Labour Inspectorate (PIP). According to the data provided by PIP to the Ministry of Labour and Social Policy, until 20 February 2007 there were 34 complaints with regard to the implementation of the I&C Act made by employees. They typically concerned the cases, in which information and consultation was not provided by employers and situations, in which employers blocked the establishing of works councils. In seven cases, the inspectors of PIP reprimanded employers and five cases were brought to the court. In addition, two employers were fined PLN 2,000 (in total).

Question 7: Relationship between I&C bodies and other forms of employee voice

(a) Can, and if so do, trade unions play a part in the establishment of I&C bodies and in their operation? Do external trade union officers often sit on I&C bodies? How common is it for I&C bodies to include both union and non-union employee representatives?

According to the original I&C Act of 2006, trade unions played statutory role in the establishment of works councils in unionised workplaces. Although trade unions lost their statutory rights to appoint works councils’ members due to the amendment to the I&C Act in 2009, they will most likely retain their influence on the selection of candidates to be elected in unionised companies. In this kind of enterprises, the involvement of non-union employees in works councils has been very rare so far.

(b) Is there any overlap between the remit of I&C bodies and trade union-based collective bargaining? If so, how are such issues resolved?

The prerogatives of the works councils and the trade unions partially overlap. Yet, the works councils have more precise and extensive rights to information than the trade unions. Research by Bednarski (2010) documented the variety of relationships between both types of employee representation in unionised companies. They ranged from the total subordination of the works councils to the company trade union to a partial and limited autonomy of works councils from union influences. In some cases, works councils became a platform, on which the joint stance of company trade unions in collective bargaining with employer was presented.

(c) Is the consultation required by the collective redundancies/transfer of undertakings Directives carried out via I&C bodies, trade unions or other employee representatives?

According to the Polish transposition of the EU Directive 98/59/EC and the Trade Unions Act of 1991, which relates to the EU Directive 2001/23/EC, the consultation in the case of collective redundancies and transfer of undertakings should be carried out via trade unions or, in absence of trade unions, by employee representative appointed in a way approved by the employer. The dilemma whether and in what way the works councils shall be involved in consultation has not been solved by legislators (PL0710029S).

(d) Is the use of direct forms of employee involvement by management through such things as team briefings seen as complementary to or in competition with the I&C body?

There is no systematic information on these issues. It should be noted, however, that some employers consider direct contacts with their staff and the use of modern information technologies (intranet) an equivalent to the I&C bodies.

Question 8: Views of the social partners

(a) What are the attitudes of the main employer and trade union organisations in your country towards (i) the value or necessity of I&C bodies and (ii) the operation of I&C bodies in practice, especially in a recession?

Although the 2006 I&C Act was drafted by the social partners in the Tripartite Commission for Social and Economic Affairs (Trójstronna Komisja ds. Społeczno-Gospodarczych), they initially showed limited support to works councils. Trade unions were afraid of weakening their position in enterprises; employer organisations were concerned about extending workers’ access to sensitive business information. While the sceptical attitude of employer organisations towards works councils has changed very slowly, the trade unions began to view works councils as potentially useful as an institution providing more extensive rights to information (PL070029Q). The current criticism of trade unions concerns mostly the poor implementation of the I&C Act at the company level. Social partners did not put special emphasis on the role, value and necessity of works councils in a recession.

(b) Have the social partners, jointly or separately, conducted any review of the operation of the national regulatory framework governing I&C? What is their assessment of its effectiveness? Is there any pressure from the social partners for reform?

The assessment of the operation of the I&C Act was done by the Tripartite Commission in April 2007. Social partners proposed amendments to the legislation, including specification of the election and operation procedures of works councils. They also decided to review the implementation of the I&C Act on a yearly basis. However, the protocols of the meetings of the Tripartite Commission do not indicate that such a review took place.

The main pressure to change legislation came from the Confederation of Polish Employers (Konfederacja Pracodawców Polskich, KPP), which opposed the monopoly of trade union organisations to appoint works councils’ members in unionised companies. KPP referred the I&C Act to the Constitutional Tribunal, which on 1 July 2008 ruled that the part concerning the elections in unionised workplaces had been unconstitutional.

An additional assessment was done by the Metalworker Secretariat of NSZZ Solidarność (Sekretariat Metalowców NSZZ Solidarność) during a conference in March 2008. While the new I&C bodies were evaluated as useful institutions broadening employee access to information, it was emphasised that legislative changes were needed with regard to a precise definition of the information that should be transmitted to the councils and clear rules on the employer bearing the costs of the council’s operation.

The amendment of the I&C Act in May 2009 partially included the postulates of social partners. It opened the way to the election of works councils in general ballots and specified that the costs of works council’s operations should be borne by employers.

Commentary by national correspondents

Despite the four years’ presence in industrial relations system in Poland, works councils have not yet become one of its central institutions. As documented by Gardawski’s (2009) study in 2007, 76.5% of working Poles supported the creation of works councils. Works councils are considered a useful institution by management, trade unions and, obviously, their members. However, research by Męcina (2009) demonstrated that that only 4.6% of employees saw works councils as an institution representing their interests better than direct supervisors (31%), trade unions (13.9%) or the board (12.1%). The same research indicated a persistent gap in interest representation at the company level: 21.7% of respondents stated that nobody represented their interests. Works councils did not fill this gap in non-unionised companies as the majority of them (69%) had been created in unionised firms and controlled by trade unions. It remains to be seen to what extent recent legislative changes, which opened the way to the election of works councils in general ballots, will contribute to broadening of the scope of workers’ representation.

Sources

  • Bednarski, Marek, ‘Rady pracowników w polskich przedsiębiorstwach. Wnioski z badań empirycznych’, in Wratny, Jerzy, Bednarski, Marek (ed.) Związki zawodowe a niezwiązkowe przedstawicielstwa pracownicze w gospodarce transformacyjnej, Warszawa, IPiSS, 2010
  • Gardawski, Juliusz, ‘Związki zawodowe w badaniach z 2007 roku’, in Gardawski, Juliusz (ed.), Polacy pracujący a kryzys fordyzmu, Warszawa, Wydawnictwo Naukowe Scholar, 2009.
  • Matla, Andrzej, ‘Wykorzystanie dyrektywy 2002/14 dotyczącej informowania i konsultacji z pracownikami w procesie zarządzania zmianami w przedsiębiorstwie – wnioski z badań’, Katowice, Sekretariat Metalowców NSZZ Solidarność, 2008, available at: http://www.funduszs.com.pl/pdf/Broszura_ERZ_2008.pdf
  • Męcina, Jacek (ed.), Dialog społeczny na poziomie zakładu pracy. Między zasadami a realiami, Warszawa, Ministerstwo Pracy i Polityki Społecznej, 2009.
  • Okraska, Remigiusz, ‘Jesteśmy u siebie. Rady pracowników jako narzędzie kształtowania postaw obywatelskich’, Łódź, ISO, 2007, available at: http://www.radypracownikow.info/dokumenty/raport_rady_pracownikow_2007.pdf
  • Portet, Stephane, ‘Rady pracowników – monitoring Ustawy z 7 kwietnia 2006 r. o informowaniu pracowników i przeprowadzaniu z nimi konsultacji’, Katowice, Sekretariat Metalowców NSZZ Solidarność, 2008, available at: http://www.funduszs.com.pl/pdf/Broszura_ERZ_2008.pdf
  • Wratny, Jerzy, ‘Rady pracowników. Przedstawiciele pracowników powoływani ad hoc’, in Wratny, Jerzy, Bednarski, Marek (ed.) Związki zawodowe a niezwiązkowe przedstawicielstwa pracownicze w gospodarce transformacyjnej, Warszawa, IPiSS, 2010

Adam Mrozowicki, Institute of Public Affairs and University of Wroclaw

Useful? Interesting? Tell us what you think. Hide comments

Add new comment