Employee participation enables employees to influence the course of events and policies in the company in which they work. Through employee participation, employees are involved in making decisions. Conversely, the employer receives important information from employees through employee participation.
Examples of tasks of a representative body are to ensure that:
- There is sufficient work consultation;
- There are good working conditions;
- Employees are treated and rewarded equally.
The Works Councils Act regulates employee participation. In virtue of the Act, a company must establish a works council (WC) if more than 50 people are employed within the company. Companies with at least 10 but less than 50 employees can also establish a staff representative body (PVT). This serves two purposes:
- The interest of the proper functioning of the company in all its objectives;
- For the benefit of consultation with and representation of those working in the company.
To this end, the Works Council and the employer regularly consult each other. Here, on the one hand the Works Council is a consultation partner and thinks along with the employer in decision-making. On the other hand, the Works Council represents the interests of the employee and puts forward the opinions and wishes of the staff. To exercise influence, a works council has several rights:
If the employer takes a decision that could have major consequences for employees such as a merger, reorganisation or major investment, the Works Council has an advisory right.
Right of consent
The employer must ask the Works Council for its consent to adopt, amend or revoke personnel regulations. These are regulations on working hours, working conditions, training, job evaluations and sick leave.
Right of initiative
The Works Council may make unsolicited proposals to the employer on all social, organisational, financial and economic matters. After consultation, the employer decides how to deal with the proposal.
Right to information
The Works Council must receive information from the employer to fulfil its role properly. For example, the Works Council is given access to the annual accounts, annual social report, remuneration structure and policy plans.
In companies with more than 100 employees, the Works Council is allowed to inspect the remuneration and terms of employment of top management.
The Works Council also has the right to speak at shareholders’ meetings, this allows it to represent employee interests to shareholders.
Rights and protection of works council members
OR members must spend a minimum of 60 hours a year working for the OR. There is no maximum.
Works Council members are also entitled to training leave:
- OR members: 5 days of training leave per year;
- Members of Works Council committees: 3 days per year;
- Members who are members of both the Works Council and a Works Council committee: 8 days per year.
The training must be agreed between the Works Council and the employer. The employer pays for the costs of training.
Ban on dismissal
The employer has a ban on giving dismissal to a Works Council member or when an employee is on the list of candidates for the Works Council. However, the employment contract can simply end if the employee agrees, if there is a summary dismissal, if there is a company closure or if the employee reaches the age of AOW. A Works Council member enjoys limited protection in the event of economic dismissal.
Mandatory establishment of Works Council
The law requires an entrepreneur with more than 50 employees to establish a works council. However, there is no sanction for not establishing a works council. Employees may, however, demand that the employer establish a Works Council. In extreme cases, a court can attach a penalty to this.
Amendments to the WCA
From 1 January 2022, the Works Councils Act (WCA) has been amended in some respects. The amendments mean that employees are more involved in a Works Council (WC) and there are fewer obstacles to participating in an OR. Below are the important changes.
Per January 1st 2023 the accountant has to send the audit report to the work council when he’s in serious concerns about the continuity of the business.
The active and passive right to vote
The statutory deadlines for the active right to vote (voting for an employee on the Works Council) and the passive right to vote (employee stands for election to the Works Council) have been shortened. Employees can therefore elect and be elected earlier.
The term for the right to vote was ‘at least 6 months of service with the employer’ and has become: at least 3 months.
The term for passive suffrage was ‘at least 12 months in the service of the employer’ and has also become: at least 3 months.
The law already gave the possibility to extend or shorten the terms through the Works Council regulations. This possibility remains.
Temporary workers also already had the aforementioned electoral rights, but only after a period of 24 months. This term has been shortened to 15 months.
Specifically, this means that a temporary worker has electoral rights after the 15-month period and the new 3-month period mentioned above (total after 18 months).
A Works Council could set up standing committees. The rule was intended that a majority of the members of a standing committee must be Works Council members. In practice, this meant that in addition to participating in the OR, OR members often had to participate in a standing committee. This was considered very burdensome (high workload).
The new rule is that at least one Works Council member participates in a standing committee. The standing committee may further consist of other employees.
Tip: The Works Council may have already made adjustments to the regulations based on the amendments to the WOR. Perhaps the amendments are just cause to still do so, for instance before the next elections. The Works Council should make sure that it involves the employer when adopting amended regulations.
The Social and Economic Council (SER) offers support, sample regulations and other sample documents for entrepreneurs who want to set up or will have to deal with an employee participation body.