No 6 (January 97/Janvier 97/Januar 97)

A High Level Group of Experts on worker involvement has been set up by the Commission under the chairmanship of Viscount Etienne Davignon, former Vice-President of the European Commission. The creation of the Group forms part of the Commission's continuing efforts to break the deadlock in the Council over the issue of worker involvement, primarily in relation to the European Company Statute ("ECS") but also in the context of the Statutes for a European association, a European mutual society and a European cooperative society.

This initiative has been taken in response to the request for acceleration of work on the ECS by the Florence European Council last year, and in the light of continuing pressure from businesses and UNICE for the adoption of the ECS. They believe the ECS will bring significant cost-savings for enterprises operating at the European level and thus help improve competitivity.

A major cause of the blockage lies in the great disparity between Member States' laws as regards the degree of worker involvement in company decision-making organs. Some Member States, notably Germany, have institutionalised systems of worker co-determination (Mitbestimmung). They fear that their companies will use the ECS to escape from Mitbestimmung if something similar is not reproduced in the ECS. Germany is supported to varying degrees by Austria, the Netherlands, Denmark and Luxembourg. Other Member States favour company works councils, whilst in the United Kingdom and Ireland there is either no institutionalised system at national level of employee representation (the United Kingdom), or what little institutionalised representation there is at national level is limited to state enterprises (Ireland). Most countries are not prepared to accept compulsory worker co-determination provisions in the ECS, but there is no majority for an alternative solution either.

Progress at the EU-level on the issue of worker involvement was made in 1994 with the adoption of the European Works Council ("EWC") Directive. This provides for compulsory information and consultation of workers in companies with a European dimension. Encouraged by the adoption of the EWC Directive to make a concerted effort to break the impasse over the worker involvement issue, the Commission took the initiative in November 1995 of issuing its Communication on the information and consultation of workers.

The Communication addressed the issue of worker involvement in relation to all of the proposals blocked by it and suggested certain options for consideration by the Member States. The third of those options, and the one which addressed in particular the ECS (as well as the proposed statutes for a European association, a European mutual society and a European cooperative society), was to remove any mention of worker participation from the proposals in question, relying instead upon the EWC Directive to provide the necessary degree of worker involvement in European Companies ("SEs") and the other entities concerned.

Such a solution has proved unacceptable, however, to countries such as Germany which favour participation in the decision-making organs of the SE, as opposed to mere worker information and consultation. In addition, they are alarmed by the fact that the EWC Directive is not binding on the UK, which opted out of the Social Chapter at Maastricht. Such countries wish to be able to continue to apply their own national laws on co-determination to SEs set up within their borders. Since the export of Mitbestimmung would not be acceptable to other Member States, however, safeguards are needed to reassure countries such as Germany that the SE would not be used by companies to escape their Mitbestimmung obligations.

The remit of the High Level Group is to make a comparative analysis of the existing systems of worker involvement in company decision-making in the EU and to evaluate the risks that the ESC might be used to escape Mitbestimmung obligations, in order to identify an approach that will meet with agreement in the Council.

The Group has met several times already, and is expected to reach its conclusions in the early part of 1997.

In addition to Mr Davignon, President of Société Générale de Belgique, the Group is comprised of experts from both sides of industry and from academia, namely: Mr Ernst Breit, former President of the Deutsche Gewerkschaftsbund (DGB); Mrs Evelyne Pichot, a French consultant working with French and European works councils, acting as rapporteur; Prof. Silvana Sciarra, Professor of Labour Law and Comparative Labour Law at the University of Florence and Professor of European Labour Law and Social Law at the European University Institute, Florence; Mr Rolf Thüsing, member of the Executive Committee of the German Employer's Confederation BDA and Vice-President of UNICE's Social Affairs Committee; and Prof. Alain Viandier, Professor specialising in company law at the Law Faculty of the University of Paris V.

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