Country overview

Lionel Fulton (Labour Research Department)

There is no right to employee representation at board level in UK companies and, other than in a tiny handful of companies, it does not exist in practice. The government produced a consultative document on the proposed legislation but there were few responses and no wider public debate.

There is no right to employee representation at board level in UK companies, and although there is nothing to prevent companies choosing to have employee representatives on boards, there are only a tiny handful of cases where this has occurred. These are companies which have substantial employee shareholdings, or companies fully-owned by municipalities – for example, some bus companies. The basic principle behind UK company law is that companies are operated for the benefit of shareholders and this leaves little room for employee involvement at board level.
The UK government published a single consultative document covering both the directive on employee involvement and the European company Regulation in October 2003. This emphasised that setting up as a European Company or SE “will be entirely voluntary”. The government indicated that it wanted to give “maximum flexibility in the way in which SEs are structured” and that it wanted to make as few changes as possible to the existing rules. There were only 22 responses to this consultation exercise, mostly from professional bodies, although the main employers’ body, the CBI, and the TUC union confederation both responded. There was, however, no formal separate consultation with unions and employers.
The implementation was achieved through a form of legislation, a Statutory Instrument, which does not require a parliamentary debate, and there was none. There was also almost no wider debate, as the issue was seen as being of little concern to the UK.

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