Country overview

Lionel Fulton (Labour Research Department)

Employee representatives have half the seats on the boards of larger Germany companies and one-third of the seats in medium-sized companies. Both unions and employers were consulted on the legislation implementing the directive and the employers used the discussion on implementation to start a wide-ranging attack on the national system of board-level representation.

Employee representation at board level is a central part of the German system of industrial relations. Employee representatives have a right to seats on the supervisory board of larger companies – one-third in companies with 500 to 2,000 employees, half in companies with more than 2,000. This made the issue of employee representation in European companies a key concern. In the years of debate before the directive was passed, the German government was concerned to ensure that German companies could not use the opportunity to become European companies to escape from their obligations to give supervisory board seats to employee representatives.
Unions and employers were consulted on the implementation of the directive and the employers used the opportunity to launch an attack on the existing system, arguing in a document published in November 2004 that it required substantial “modernisation”. This led in turn to a government commission, made up of representatives of the unions and the employers and independent experts, being appointed to discuss employee board-level representation in Germany. It completed its work at the end of 2006 but was unable to present a common report because of fundamental disagreements between the unions and employers. However, the independent members of the commission produced their own report, which stated that they saw no reason to propose a fundamental revision of the German system of board-level representation but called for a number of changes. As the coalition government which by that time was in place, had agreed that it would only implement the recommendations of the commission if they were unanimous, no subsequent changes were introduced.
It remains the case, however, that Germany is one of the few, if the not the only country, where the implementation of the directive led to a wide public debate.

Special negotiating body (SNB)

Standard rules under the fallback procedure

Misuse of procedures and structural change

L. Fulton (2008) Anchoring the European Company in National Law - Country Overviews (online publication, prepared for