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What makes a good company? Employee interest representation in European company law: reflections and legal provisions (ETUI-REHS Report 94)

Bedrac report

Involvement of workers’ representatives is crucial for sound corporate governance, promising both improved economic performance and fulfilment of the Lisbon strategy. This report presents an overview of European company law and its relationship to European law on employee involvement. Thanks to Janja Bedrac’s compilation, trade unionists will find it easier to orient themselves and to identify legal reference points in this relevant and decisive debate.

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Our contact details

A list of our contact details.

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Trade Unions

A fifth of employees (18%) are union members in the Netherlands, and the proportion has been gradually falling in recent years. There are two main confederations, the FNV – the larger of the two – and the CNV, initially divided on ideological/confessional lines, although now with good relations. The other main union grouping has recently split and with the FNV also undertaking a radical restructuring, unions are facing significant organisational changes. note2

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General framework for informing and consulting employees (Directive 2002/14/EC)

The objective of Directive 2002/14 is to establish a general framework for informing and consulting employees in the European Community. In contrast to the EWC and SE Directives, this legislation lays down minimum standards at national level. It is the first in which the EU has extended to every member state the obligation to provide a procedure for effective, ongoing and regular information and consultation for workers on recent and probable developments in the undertaking’s activities, financial and economic situation, the evolution of employment and in particular of decisions that might lead to major changes in the organisation of labour.

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Background: "The SCE – The small sister of the SE"

The European Cooperative Society (SCE) constitutes another step in the completion of the EU’s internal market. It aims to reduce existing cross-border obstacles and to make it easier for companies to operate across European borders, thereby enhancing their competitiveness. In this sense, the SCE complements the legislation on European Companies (SE) which has enabled companies to set up as a European public limited company. The SCE fills the gap regarding the transnational activities of cooperatives. As in the case of the SE, the SCE legislation consists of a Regulation on the Statute for an SCE and an accompanying Directive on worker involvement. The Regulation came into force from 18 August 2006, by which date the member states also had to transpose the SCE directive into national law.

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Workplace Representation

Employee representation at the workplace is essentially through works councils elected by all employees. They should be set up in all workplaces with at least 50 employees and more than three-quarters of workplaces of this size have them. (There are other arrangements for smaller workplaces.) Works councils are not directly union bodies, although union members often play a key role.

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Who pays the costs of the special negotiating body (SNB) and the representative body (RB)?

How long do negotiations on employee involvement take?

What can be the result of the negotiations?

What is the content of an agreement under Article 4 Dir?

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