Information and consultation of workers across Europe: part three

If a trade union believes that an employer has not fulfilled its duties in relation to any of the above obligations, it can bring a case to the Labour Court. In general, around 300 cases every year are brought by trade unions to the Labour Court. Most of these are concerned with breaches of the prior consultation provisions of the 1985 Act and provisions regarding dismissals and layoffs of the 1982 Act.

In addition to these statutory rights, a number of collective agreements, both at national and local level, contain addition rights, such as details concerning paid time off to carry out employee representation duties. In some cases, they also give trade unions the right to use the services of an expert or a consultant and give additional information and consultation rights in areas such as the introduction of new technology.

Confidentiality

The employer can oblige trade union representatives not to disclose any information that it deems to be of a confidential nature. If there are disagreements between trade union representatives and management about whether information is confidential, the matter can be taken to the Labour Court, which will issue a ruling.

Protection of employee representatives

In terms of protection against dismissal, trade union representatives are the last people who can be dismissed when selecting for redundancy. These provisions, contained in the 1982 security of employment Act, are highly controversial and this Act has been the subject of much debate in recent years.

Amendments to the 1982 Act, allowing companies with 10 or fewer employees to make two employees exempt from rules governing selection for redundancy on grounds of seniority, came into force at the beginning of 2001.

Resources

The 1974 Act relating to the position of trade union representatives at the workplace allows trade union representatives to carry out their duties and attend any relevant training courses in working time. In practice, the actual amount of paid time allowed is negotiated at local level.

Further, the employer must provide adequate resources in terms of office space to allow trade union representatives to carry out their duties.

Worker participation at Zanussi

A worker participation agreement was signed on 21 July 1997 at Zanussi, the Italian subsidiary of the Swedish white goods manufacturer Electrolux. The accord was signed by representatives of the Electrolux Zanussi Group and the Fim-Cisl, Fiom-Cgil and Uim-Uil metalworking trade unions.

Worker participation at Zanussi dates back to 1991 when bipartite bodies were established to deal with a wide range of issues previously subject to collective bargaining, including the organisation of work, technology, health and safety and canteens. Decisions on these issues are subject to majority voting within the individual bodies. In 1993 Zanussi extended this "worker-friendly" approach to cover negotiations on redundancies and the promotion of flexible working patterns. The July 1997 agreement builds on this and puts into place an improved participation model.

The participatory system at Zanussi comprises four joint bodies at local level:

The workings of these local joint bodies are overseen by group-level coordination centres.

Four further group-level centres are provided for:

Above all of these joint bodies sits the national guarantee commission, which ensures the proper functioning of the company's participation model. This is made up of three company representatives, three union representatives and a mutually-appointed neutral chair.

UNITED KINGDOM

There is no statutory or collectively agreed generalised framework in place in the UK obliging employers to inform and consult employee representatives, although some information and consultation rights do exist in certain areas, connected to the transposition of EU Directives. However, voluntary collective bargaining arrangements between employers and trade unions operate in many companies, underpinned by a new statutory right to trade union recognition if supported by the majority of the workforce.

Information and consultation rights

Representatives of the workforce have a right to information and consultation in the areas in which the UK has issued legislation to comply with EU Directives, principally: business transfers; collective redundancies; and health and safety. Information and consultation in the area of health and safety is conducted between the employer and statutory health and safety representatives. These representatives may be appointed by a representative trade union. If there is more than one representative, the employer must, if requested, set up a health and safety committee. Further, provisions of the Employment Relations Act 1999 which came into effect on 6 June 2000 give recognised trade union representatives the right to be informed and consulted on training issues.

Information and consultation in the areas of collective redundancies and business transfers is conducted between the employer and trade union or elected workforce representatives.

In addition, voluntary collective bargaining arrangements exist in many companies between the employer and trade union representatives. These agreements may cover information and consultation on a range of issues. If the employer recognises the trade union for collective bargaining purposes, negotiation between the employer and union representatives will take place on a range of issues, with a view to reaching an agreement. If there is disagreement, the trade union may ballot on industrial action in support of its position.

Recognition arrangements have been given a boost over the past year by the coming into force on 6 June 2000 of provisions of the Employment Relations Act 1999, obliging an employer with at least 21 employees to recognise a trade union if the majority of the workforce wishes, and puts into place a balloting procedure to support this right if an employer refuses to grant recognition.

Prior to the coming into force of this legislation, there was no obligation on employers to recognise trade unions. Thus, there is now statutory underpinning of voluntary recognition. There is also evidence that this legislation has increased the incidence of trade union recognition and collective bargaining in the UK.

Protection of employee representatives

Dismissal on grounds of trade union membership or activities or for non-membership of a trade union counts as unfair dismissal and is not subject to the normal qualifying period of one year's service which applies to claims of unfair dismissal on other grounds. Further, any discrimination based on grounds of trade union membership or non-union membership is prohibited.

Resources

Trade union representatives have a statutory right to "reasonable" paid time off work in order to carry out their duties and to undergo relevant training. The operation of this right is clarified in a code of conduct drawn up by the UK state Advisory, Conciliation and Arbitration Service, ACAS, entitled ACAS Code of Practice No.3 - Time off for trade union duties and activities.

Trade union representatives also have a right to hold workplace ballots on employer premises. Other resources may be obtained by agreement.

Partnership

A growing number of partnership agreements between trade unions and company management, providing for workforce information and consultation structures, have been signed in recent years. These agreements are aimed at giving companies a competitive advantage and essentially address areas such as training, development and business issues. The impetus for many agreements is restructuring to ensure the survival of the company - many partnership agreements find a balance between flexibility desired by the employer and job security as desired by trade unions. Many employers in the UK used partnership accords to restructure their information and consultation arrangements in advance of the coming into force of the Employment Relations Act 1999.

The central trade union confederation, the Trades Union Congress (TUC), supports the concept of partnership and in January 2001 launched the TUC Partnership Institute to help organisations improve industrial relations and develop partnerships between unions and employers. Its stated aim is to "create a sea change in British workplaces by establishing partnership as the modern and successful approach to industrial relations".

Recent examples of partnership agreements negotiated in UK companies include those at British Nuclear Fuels Ltd, the retailer Tesco, Barclays Bank, the insurance group Legal & General, ScottishPower Generation Wholesale, Blue Circle Cement and Thames Water Utilities. Case studies of these agreements can be found in IRS Employment Review, available from IRS. For an overview of the partnership agreement at the business process outsourcing organisation CSL Group, see the box below.

The first two parts of this feature were published in Information and consultation of workers across Europe: part one and Information and consultation of workers across Europe: part two.

Partnership agreement at CSL

CSL Group is one of the UK's leading business process outsourcing organisations. Employing around 2,500 people, it concentrates on providing managed services to local and central government, including accounting and financial management, human resources and transaction and technology services. In June 1999, CSL signed two partnership agreements, one with the public service union Unison and the other with the Public and Commercial Services Union (PCS). Unlike many other partnership agreements in the UK, the impetus for this accord was not company restructuring, but a desire to improve employee relations, particularly in light of the fact that the UK government was, at the time, preparing its Fairness at Work legislation, which included a right to statutory trade union recognition. This right came into force in 2000 as part of the Employment Relations Act 1999. In particular, the company felt that it wanted to create its own employee representation culture ahead of the coming into force of the new legislation.

The agreement is based on a climate of cooperation and trust between company management and the unions. It states that: "To ensure an effective partnership agreement, both parties recognise the need for a spirit of mutual trust. Confrontational management or union activity is seen as unproductive and contrary to the partnership agreement." The accord states that the company is committed to "wide-ranging and inclusive consultation" with its employees through "properly constituted staff forums".

National forum

The accord provides for the setting up of a national forum as the vehicle for company-wide collective bargaining and consultation. This forum comprises two full-time officials from the PCS trade union, two full-time officials from Unison, four CSL management representatives and one representative from each of 13 local sites. These 13 local representatives are either nominated trade union representatives, if over 40% of employees at the site are union members, or are elected staff representatives if less than 40% of employees at the site are union members. In practice, this means that all consultation bodies may be a mixture of union and staff representatives, depending on the level of trade union membership. Representatives are elected or nominated annually.

This national forum meets at least quarterly and is defined as the main vehicle for collective bargaining at the company. It has collective bargaining rights in the areas of pay and benefits, health and safety and disciplinary and grievance procedures. It also acts as the consultation vehicle for company-wide issues such as organisational change which affects a large group or groups of employees, company policies and procedures which relate to employees and training.

Local forums

The agreement also sets up forums at local level, comprising either nominated trade union representatives, if more than 40% of the workforce are trade union members, or elected staff representatives, if less than 40% of the workforce are trade union members. The size of these forums depends on the size of the business centre, with the aim being that one representative should represent around 40 employees.

Discussions in the local forums focus on local business issues, statutory consultation in the event of redundancy or the transfer of staff at that site, the implementation of nationally determined initiatives and locally determined issues.

Advantages for unions and management

The trade unions involved decided to sign the agreement, even though it contains minimum membership thresholds for union representation, as they saw it as a way to improve service for existing members, retain and increase membership, help to improve industrial relations in the future and serve as an example to other companies on how to create national collective bargaining structures.

For the company, the agreement was both a means of being able to pre-empt the Employee Relations Act 1999 and a means of creating a "problem-solving" rather than a confrontational climate at the organisation.

A full overview of this agreement can be found in IRS Employment Trends 693, December 1999, pp.4-10, available from IRS.

Impact of the information and consultation Directive: the views of the social partners

The proposed new Directive on informing and consulting employees, on which a conciliated text has now been reached (this issue, p.2), will have a varying impact in individual countries, depending on the system currently in place. In some countries, such as France, Germany and the Scandinavian countries, it is likely to have limited impact, while in others such as Ireland and the UK, the effects are likely to be much greater. Many social partner organisations have issued position papers and statements containing their views on this subject. We look at a range of views in selected countries.

In Austria , the social partners have all issued statements containing their views on the Directive. The central trade union confederation OGB welcomes the Directive as an important development in creating common minimum social standards in Europe, although it notes that the Directive should not be allowed to prejudice existing arrangements in Europe. The workers' chamber (Arbeiterkammer) has also welcomed the Directive as a way of addressing the gaps in social rights highlighted by the now-famous Renault case of February 1997.

However, the employers' organisation, the economic chamber (Wirtschaftskammer) is opposed to the Directive on grounds of subsidiarity, as it believes that there is no need to regulate this issue at the European level. It also believes that the legal base of the Directive is not appropriate, and is fiercely opposed the provision in the original draft of the text that decisions would be void if the provisions of the Directive were breached. This sanction has now been dropped from the text.

In Denmark, the social partners feel that the proposed Directive will not require any significant alteration of current practice. However, there is concern about how to implement the Directive by means of collective agreement, which is the preferred method of regulation in Denmark.

In Finland, employers' organisations - TT and PT - have expressed opposition to the proposed Directive on the grounds that European-wide regulation is not necessary. However, trade unions have been quite positive, although SAK has stated that the proposal could have gone further, particularly in terms of the proposed threshold and, in its view, the narrow definition of information.

In Greece, there is at present not an especially lively debate about information and consultation. In general, the GSEE trade union confederation is in favour of the proposed Directive on this topic, although this is not one of its stated policy priorities at present. However, employer representative organisations are more sceptical about the draft Directive. Nevertheless, once the Directive is adopted, there is bound to be renewed interest in terms of its transposition and implementation. The main task is likely to be to articulate and harmonise the existing, but not active, provisions of legislation already in place.

Ireland is one of the countries that will be most affected by the Directive, and employers have expressed concern about its content and the potential impact it may have on current information and consultation practices in Ireland. ICT Ireland, the sectoral association representing companies in the information and communications technology sector, and affiliated to the central employers' organisation IBEC, has issued the following statement: "Whilst ICT Ireland wholeheartedly supports the principle of informing and consulting employees, we need a balanced approach so that companies have the ability to be flexible in order to survive in this fast-moving world. The burden currently placed on companies as concerns social legislation and processes is considerable and growing. The need to inform and consult employees should not place heavy, unworkable structures on companies but should support them in finding a solution which best suits them and their employees in order to build up a lasting and worthwhile relationship. The Directive has the potential to impose new unwieldy structures for communicating with employees which could be counterproductive and interfere with a company's absolute right to manage." It adds that, in its view, it is vital that the Directive is implemented with sufficient care to recognise Irish industrial relations traditions and customs.

In Italy, trade unions support the Directive, as they maintain that around 80% of workers in Italian companies (mainly small and medium-sized companies) do not enjoy information and consultation rights. However, the central employers' organisation, Confindustria, is opposed to the Directive, stating that national collective bargaining and the transposition of EU Directives are more than adequate in providing protection to workers in this area.

In the Netherlands, both employers and employees are fairly relaxed about the implementation of the Directive because, as it currently stands, it would not have any significant impact upon current practice in this country. The employers' organisation AWVN recently conducted research among 17 Dutch headquartered multinational companies, finding that their management believed that communication generally added value in an organisation. The FNV trade union confederation has as one of its main aims the improvement of consultation. Most specifically, it would like the timing of consultation to be meaningful in that it always gives employee representatives an opportunity to formulate an opinion and have an input into the decision-making process.

In Spain, the social partners are generally in favour of the proposed Directive as, in its current form, it reinforces practices already current in this area.

Information and consultation of employees at the workplace is not at the forefront of debate in Sweden. However, employers are always keen to stress how expensive trade union consultation and negotiation is. In terms of the Directive, employers have some concerns in terms of how it will affect the way the system currently operates in Sweden. Trade unions feel that the Directive could have gone further by extending rights to workers in smaller companies. They have also expressed disappointment that it will not make much difference to the way things operate in most EU countries, with the obvious exceptions of the UK and Ireland.

In the United Kingdom, where practice could be considerably affected by the Directive, the central employers' confederation CBI has stated that it is "deeply disappointed" with the Directive. However, it goes on to say that the text as agreed by the Council in June 2001 contains some "useful flexibilities that will help limit its damaging impact" - this refers to provisions such as the longer implementing period for countries with no generalised system of information and consultation. The CBI was unhappy that the European Parliament removed some of this flexibility in its second reading of the text, given in October 2001 (European Parliament votes to amend information and consultation proposal) and has been active in endeavouring to put across its view of what the final text ought to contain.

But the UK central trade union confederation - the TUC - actively supports the Directive and has welcomed the European Parliament's amendments to the text, which strengthen its provisions in a number of areas. TUC general secretary John Monks has issued a statement maintaining that the Directive "opens the door on a whole new era in UK employment relations. There is a good business case for involving the workforce actively in decision making and in developing appropriate and effective management systems. Effective consultation helps to enhance competitive performance because employees who are being consulted are far more likely to support management plans."