What changed between the draft committee report and the plenary report

DRAFT EUROPEAN PARLIAMENT LEGISLATIVE RESOLUTION

on the proposal for a directive of the European Parliament and of the Council amending Directive 2009/38/EC as regards the establishment and functioning of European Works Councils and the effective enforcement of transnational information and consultation rights

Changed:(COM(2024)0014 – C90012/2024C900012/2024 – 2024/0006(COD))

5 unchanged paragraphs

(Ordinary legislative procedure: first reading)

The European Parliament,

– having regard to the Commission proposal to Parliament and the Council (COM(2024)0014),

– having regard to Article 294(2) and Article 153(1)(e) in conjunction with Article 153(2)(b) of the Treaty on the Functioning of the European Union, pursuant to which the Commission submitted the proposal to Parliament (C90012/2024),

– having regard to Article 294(3) of the Treaty on the Functioning of the European Union,

Changed:– having regard to the opinion of the European Economic and Social Committee,Committee of 30 May 2024,

Change 1

Changed:– having regard to the opinionAfter ofconsulting the Committee of the Regions,

Changed:– having regard to Rule 5960 of its Rules of Procedure,

Changed:– having regard to the report of the Committee on Employment and Social Affairs (A90000/2024),(A10-0029/2024),

1. Adopts its position at first reading hereinafter set out;

2. Instructs its President to forward its position to the Council, the Commission and the national parliaments.

Change 2

Changed:Recital 5: (5) Evidence shows that legal uncertainty regarding the concept of transnational matters has led to differences in interpretation and disputes. In order to ensure legal certainty and reduce the risk of such disputes, it is necessary to clarify that concept. To this end, it is appropriate to clarify that this Directive should not only cover cases where measures considered by management can reasonably be expected to affect employees in more than one Member State, but also cases where such measures can reasonably be expected to affect workers in only one Member State, but the consequences of those measures can reasonably be expected to affect workers in at least one other Member State. In addition, casesCases in which measures considered by management of the Community-scale undertaking or Community-scale group of undertakings are taken in a Member State other than that in which those effects are produced should also be covered. This is necessary to cover cases where undertakings envisage measures, such as lay-offs and redundancies, which do explicitly target establishments in only one Member State but nevertheless can reasonably be expected to have consequences affecting employees in another Member State, for instance due to changes in the cross-border supply chain or production activities, where such measures could lead to substantial changes in work organisation or in contractual relations.

Change 3

Changed:Recital 8: (8) Directive 2009/38/EC requires the parties to a European Works Council agreement to determine the venue of meetings of the European Works Council. It is appropriate to specify that they are to determine also the format of such meetings, notably to avoid any doubt aboutthat theirthe freedomregular toannual agreemeetings thatof somethe ofEuropean Works Council and the select committee should take place in person, whereas additional meetings may be held in a virtual environment, using online meeting tools,tools if so agreed, reducing the environmental footprint of meetings in line with Union, national and companies’ emission reduction targets, while ensuring meaningful information and consultation at lower environmental and financial costs.

Change 4

Changed:Recital 9: (9) There can be uncertainty and disputes with respect to the coverage of certain expenses and access to certain resources also during the operation of European Works Councils. In accordance with the principle of autonomy of the parties, it is appropriate to require that certain types of financial and material resources be determined specifically in the European Works Council agreements, namely the possible use of experts – such as representatives of a recognised Community-level trade-union, technical subject-matter experts or legal experts – and the coverage of experts’ fees, and the coverage of legal costs, including the costs of legal representation and of participation in administrative or judicial proceedings. The agreements should also address the provision of relevant training to the members of the European Works Council, and the coverage of related expenses, without prejudice to the minimum requirement in Article 10(4) of Directive 2009/38/EC. Reasonable costs concern expenses that are related to the proper functioning and operation of the special negotiating body or the European Works Council, including the costs of experts, legal representation, participation in administrative and judicial proceedings and training. Member States may lay down budgetary rules regarding the operation of a European Works Council.

Change 5

Removed:Recital 11: (11) Evidence shows that the initiation of negotiations is sometimes delayed beyond the period of six months set out in Directive 2009/38/EC. In some cases, management neither takes steps nor expressly refuses to commence negotiations following a request to set up a European Works Council. It should therefore be specified that the subsidiary requirements laid down in Directive 2009/38/EC apply where the first meeting of the special negotiating body is not convened within six months following a request to establish a European Works Council, irrespective of whether central management expressly refuses to commence negotiations or where, after 18 months from the date of such a request, the central management and the special negotiating body are unable to reach an agreement.

Added:Recital 10: (10) European Works Councils should promote a balanced, inclusive and diverse representation of employees. The requirement in Directive 2009/38/EC to take into account, where possible, the need for a balanced representation of employees with regard to their gender when determining the composition of European Works Councils has proven insufficient to promote gender balance. Women remain underrepresented in most European Works Councils. Therefore, it is necessary to lay down more effective and specific objectives regarding gender representation, to be implemented by management and employee representatives when negotiating or renegotiating their agreements. To attain those objectives, it may in certain cases be necessary to give priority to the underrepresented sex in composing the European Works Council or its select committee. In accordance with the case-law of the Court of Justice of the European Union, such positive action is possible, in accordance with the principle of equal treatment of men and women, provided that the measures taken to achieve the gender balance objective do not automatically and unconditionally give priority to persons of a certain gender but allow to take into account other criteria, such as merits and qualifications and the procedure for election established by the relevant laws. Parties to European Works Council agreements should therefore be afforded the flexibility necessary to respect the legal and factual limitations to the positive action. For s…

Change 6

Changed:Recital 12: (12) When sharing sensitive information with members of European Works Councils, members of special negotiating bodies, or employees’ representatives in the framework of an information and consultation procedure, management has the possibility to provide that such information is shared in confidence and should not be disclosed further. This should not apply to situations whenin which members of the European Works Council decide to reveal information to national or local work councils that may affect the situation of workers. When sharing information in confidence, central management should be required to provide at the same time a reasonable justification based on objective criteria. Setting up adequate arrangements to safeguard the confidentiality of sensitive information can instil trust and facilitate the sharing of such information, while protecting business and workers’ interests, including to avert growing risks such as industrial espionage.

Change 7

Changed:Recital 15: (15) Effective transnational consultation requires a genuine dialogue between central management and European Works Councils, or employees’ representatives in the framework of an information and consultation procedure. This implies that information and consultation need to be conducted in a meaningful and timely way that enables worker’s representatives to express their opinion prior to the adoption of the decisiondecision, which could include business plans, social plans, and process innovations where they may impact on redundancies, and that opinions issued by European Works Councils or employees’ representatives must receive a reasoned response from central management before the latter or other competent organ of the Community undertaking or Community-scale group of undertakings adopts its decision on the proposed measure at issue. An explicit requirement to that effect should be laid down in Directive 2009/38/EC to ensure legal certainty. In thisthat context, it is important to ensure that Community undertakings or Community-scale groups of undertakings can take decisions effectively.effectively and do not result in undue delays in decisions taken by Community undertakings or Community-scale groups of undertakings.

Change 8

Changed:Recital 15 a (new): (15a) In the case of a disagreement onabout whether to undertake an information or consultation procedure, there is a lack of guidance on how to resolve the negative effects that such disagreements may have on members of European Works Councils and employees'semployee representatives. Therefore, shouldif there beis a dispute with regardsregard to whether an information and consultation procedure should be undertaken, the central management should provide duly substantiated grounds in writing specifying the reasons why the information and consultation provisions ofin this Directive relating to information and consultation are not applicable.

Change 9

Changed:Recital 15 b (new): (15b) In the context of an information and consultation procedure, the European Works Council or the select committee mayshould be able to request assistance and advice from experts of its choice, such as representatives of competent recognised Community-level trade union organisations. Such experts should be allowed to attend meetings of the European Works Council and meetings with the central management in an advisory capacity. Moreover, Member States can lay down budgetary rules for the operation of a European Works Council.

Change 10

Changed:Recital 17: (17) In certain Member States, rightsholders under Directive 2009/38/EC encounter difficulties in bringing legal actions to enforce their rights. It is therefore necessary to strengthen Member States’ obligation to ensure effective remedies and access to justice and the supervision by the Commission of their compliance with that obligation. For that purpose, Member States should be required to notify the Commission of how and under which circumstances the rightsholders, including employees’ representatives, members of the special negotiation body and members of a European Works Council, can bring judicial, and where applicable, administrative procedures, in respect of all their rights under this Directive, including the right to form and join trade unions. In addition, Member States should develop mechanisms to encourage mediation and, where appropriate, provide for alternative dispute mechanisms. Moreover, it should be clarified that the relevant procedures have to enable a timely and effective enforcement, and that possible prior out-of-court settlement procedures can neither result in a decision which is binding on the parties concerned, nor prejudice rightsholders’ right to bring legal proceedings. However, Membersmembers of special negotiations bodies,bodies and members of European Works Councils and employees’ representatives should enjoy the same protection and guarantees equivalent to those provided to employees’ representatives by national legislationlaw or practice applicable in their country of employment.

Change 11

Changed:Recital 18: (18) The Commission’s 2018 evaluation of Directive 2009/38/EC has shown that sanctions applicable in the case of non-compliance with transnational information and consultation requirements regretfully are often not sufficiently dissuasive, effective or proportionate. Therefore, it is appropriate to lay down the Member States’ obligation to provide for effective, dissuasive and proportionate sanctions. Financial penalties should be provided for in case of failure to comply with the information and consultation procedures set out in Directive 2009/38/EC. Other forms of sanctions should also be provided for, including administrative and judicial procedures. In line with national law and practice, Member States should ensureprovide thefor a possibility to request a preliminary injunction in national courts or other competent authorities for a temporary suspension of the implementation of management decisions until an information and consultation procedure has taken place at the relevant level of management and representation and in such a way as to enable a reasoned response from the central management in accordance with this Directive. Financial sanctions should be determined taking into consideration the size and financial situation of the Community-scale undertaking or group – for example, based on its annual turnover – and any other relevant factors – such as the gravity, duration, consequences, and intentional or negligent nature of the offence –, in order to be effective, dissuasive an…dissuasive…

Change 12

Removed:Recital 19: deleted / (deleted)

Added:Recital 19: (19) Undertakings with an agreement on the transnational information and consultation of employees concluded before 23 September 1996, that is to say prior to the date of application of Council Directive 94/45/EC1a, are exempted from the application of the obligations arising from Directive 2009/38/EC. The employee information and consultation bodies established under such agreements have been concluded and continue to operate outside the scope of Union law and their legal status should be ensured by civil or collective labour law, depending on the different legal system of each Member State. Directive 2009/38/EC does not provide the employees in the exempted undertakings with the possibility to request an establishment of a European Works Council under that Directive. However, for reasons of legal clarity, equal treatment and effectiveness, employees and their representatives in all Community-scale undertakings or Community-scale groups of undertakings should in principle have the right to request the establishment of a European Works Council. Almost 30 years after a legislative framework setting minimum requirements for the transnational information and consultation of employees was first established at Union level, those reasons prevail over the considerations of continuity for pre-existing agreements which initially motivated the exemption. That exemption should therefore be deleted.

Change 13

Changed:Recital 19 a (new): (19a) After more than 25 years from the adoption of Council Directive 94/45/EC, many pre-directive agreements are still in force and have not been adapted to the requirements of Directive 2009/38/EC. It is essential that all European Works Council agreements are governed by the same rights and obligations in order to ensure equal treatment of workers, access to the application of high Union standards, and legal certainty. With a view to creating a regulatory level-playing field governing the functioning of European Works Councils, the rights and obligations arising from Directive 2009/38/EC should be applicable to all European Works Council agreements and agreements on an information and consultation procedure concluded in accordance with Articles 5 and 6 of Directive 94/45/EC or in accordance with Articles 5 and 6 of this Directive. All agreements which have been concluded pursuant to Article 13(1) of Directive 94/45/EC and agreements concluded pursuant to Article 6 of Directive 94/45/EC which were signed or revised between 5 June 2009 and 5 June 2011 should fall within the scope of this Directive without any obligation to renegotiate.

Recital 20: deleted

Change 14

Added:Recital 21: (21) European Works Councils operating based on the subsidiary requirements set out in Annex 1 to Directive 2009/38/EC have the right to meet with central management once a year, to be informed and consulted on the progress of the business of the relevant Community-scale undertaking or Community-scale group of undertakings and its prospects. In order to strengthen the transnational information and consultation of those European Works Councils, it is appropriate to increase the number of such annual plenary meetings in the subsidiary requirements to at least two. When appropriate and agreed upon and while ensuring meaningful information and consultation, digital means of communication and coordination can be used in exceptional cases without replacing ordinary meetings.

Added:Recital 24: (24) Existing European Works Council agreements or agreements on information and consultation procedures, concluded under Directive 94/45/EC or Directive 2009/38/EC before the entry into force of the measures adopted by Member States to transpose this Directive, may not be in conformity with the revised required contents of those agreements. It is therefore appropriate to set out transitional arrangements enabling the parties to such agreements to negotiate addenda, without, however, requiring a complete re-negotiation of the agreement. In order not to allow for any interruption of the information and consultation of employees, the existing European Works Council agreement or agreement on information and consultation procedure is to remain in force during the negotiation of such addenda.

Added:Recital 24 a (new): (24a) If the central management initiates negotiations to supplement an existing European Works Council agreement or agreement on information and consultation procedures in accordance with the requirements of this Directive, there is no obligation to renegotiate the entire existing agreement. The amended requirements should be negotiated as an addendum within 2 years of the date of transposition of this Directive. Provision should be made for the subsidiary requirements specifically relating to the amended requirements to apply in the absence of an agreement on the addendum within that time limit.

Added:Recital 24 b (new): (24b) It is necessary to ensure that the special negotiation body has the opportunity to meet regularly with the central management in order to be able to conduct meaningful negotiations. Where the conditions laid down in Article 7(1) are met, it should be clarified that it is the responsibility of the central management to initiate the establishment of a European Works Council according to the subsidiary requirements.

Directive 2009/38/EC

Change 15

Changed:Article 1 – paragraph 1 – point 1, Article 1 – paragraph 4 – subparagraph 2 – point a: (a) the measures considered by management ofin the Community-scale undertaking or Community-scale group of undertakings can reasonably be expected to affect workers in undertakings or establishments in more than one Member State; or

Directive 2009/38/EC

Change 16

Changed:Article 1 – paragraph 1 – point 1, Article 1 – paragraph 4 – subparagraph 2 – point b: (b) the measures considered by management ofin the Community-scale undertaking or Community-scale group of undertakings can reasonably be expected to affect workers in an undertaking or establishment in one Member State, and workers in an undertaking or establishment in anotherat least one other Member State can reasonably be expected to be substantially affected by the consequences of those measures.”; or

Directive 2009/38/EC

Change 17

Changed:Article 1 – paragraph 1 – point 1, Article 1 – paragraph 4 – subparagraph 2 – point b a (new): (ba) the measures considered by central management of the Community-scaleCommunityscale undertaking or Community-scale group of undertakings arecan takenreasonably be expected to affect workers in a Member State other than that in which those effectsmeasures are produced.’;being considered.

Directive 2009/38/EC

Change 18

Changed:Article 1 – paragraph 1 – point 1, Article 1 – paragraph 4 a (new): 4a. In order to determine the transnational character of a matter, the scope of its possible effects on the workforce and the level of management and representation involved shall be taken into account. This includes matters which, irrespective of the number ofshall Memberinclude Statesmatters involved,which are of concern to workers in terms of the scope of their potential impact,impact in two or more Member States, as well as matters which involve the transfer of activities between two or more Member States.

4 unchanged paragraphs

Article 1 – paragraph 1 – point 2: (2) in Article 2(1), points (d), (f) and (g) are replaced by the following:

Directive 2009/38/EC

Article 1 – paragraph 1 – point 2, Article 2 – paragraph 1 – point d: (d) ‘employees’ representatives’ means trade unions or the employees’ representatives provided for by national law or practice;

Directive 2009/38/EC

Change 19

Changed:Article 1 – paragraph 1 – point 2, Article 2 – paragraph 1 – point g:f: (g)“(f) ‘consultation’‘information’ means the establishmenttransmission of dialoguedata andby exchangethe ofemployer viewsto betweenthe employees’ representatives andin centralorder managementto orenable anythem moreto appropriateacquaint levelthemselves ofwith management,the subject matter and to examine it and is given at such time, in such fashion and with such content as enables employees’are representativesappropriate to express a prior opinion on the basis of the information provided about theenable proposedemployees’ measuresrepresentatives to which the consultation is related, without prejudiceundertake toan thein-depth responsibilitiesassessment of the management,their andpossible withinimpact aand, reasonablewhere time,appropriate, whichprepare isfor toconsultations bewith takenthe intocompetent accountorgan withinof the Community-scale undertaking or Community-scale group of undertakings. Consultation shall take place in such a way as to enable employees’ representatives to obtain a reasoned response in due time from the central management prior to the adoption of the decision;”;undertakings;

Directive 2009/38/EC

Change 20

Removed:Article 1 – paragraph 1 – point 3 – point – a (new), Article 5 – paragraph 1: (-a) paragraph 1 is replaced by the following: / ‘1. In order to achieve the objective set out in Article 1(1), the central management shall initiate negotiations for the establishment of a European Works Council or an information and consultation procedure on its own initiative or at written request, either jointly or separately, of at least 100 employees or their representatives in at least two undertakings or establishments in at least two different Member States.’;

Added:Article 1 – paragraph 1 – point 2, Article 2 – paragraph 1 – point g: (g) ‘consultation’ means the establishment of dialogue and exchange of views between employees’ representatives and central management or any more appropriate level of management at such time, in such fashion and with such content as enables employees’ representatives to express a prior opinion on the basis of the information provided about the proposed measures to which the consultation is related, without prejudice to the responsibilities of the management, and within a reasonable time, which is to be taken into account within the Community-scale undertaking or Community-scale group of undertakings. Consultation is to take place in such a way as to enable employees’ representatives to obtain a reasoned written response in due time from the central management prior to the adoption of the decision provided the employee representatives expressed their opinion within a reasonable time in accordance with the first sentence;

Directive 2009/38/EC

Change 21

Removed:Article 1 – paragraph 1 – point 3 – point -a a (new), Article 5 – paragraph 2 – introductory part: (-aa) the introductory wording of paragraph 2 is replaced by the following: / 2. For this purpose, a special negotiating body shall be established within six months of the date of a request pursuant to paragraph 1, with a possible 6-month extension, in accordance with the following guidelines:

Added:Article 1 – paragraph 1 – point 2, Article 2 – paragraph 1 –subparagraph 1 a (new): For the purposes of point (c) of the first subparagraph, employees of controlling and controlled undertakings within the meaning of Article 3(2), point (ca), shall also be taken into account in the definition of a Community-scale group of undertakings;

Directive 2009/38/EC

Change 22

Removed:Article 1 – paragraph 1 – point 3 – point a a (new), Article 5 – paragraph 4 – subparagraph 3: (aa) in paragraph 4, the third subparagraph is replaced by the following: / ‘For the purpose of the negotiations, the special negotiating body may request assistance from representatives of competent recognised Community-level trade union organisations and, if needed, further experts of its choice. Such experts and such trade union representatives may be present at negotiation meetings in an advisory capacity at the request of the special negotiating body.’;

Added:Article 1 – paragraph 1 – point 2 a (new), Article 3 – paragraph 1: (2a) in Article 3, paragraph 1 is replaced by the following: / ‘1. For the purposes of this Directive, ‘controlling undertaking’ means an undertaking which can exercise a dominant influence over another undertaking (the controlled undertaking) by virtue, for example, of ownership, financial participation, control over decisions or the rules which govern it.’

Directive 2009/38/EC

Change 23

Removed:Article 1 – paragraph 1 – point 3 – point b – indent 1, Article 5 – paragraph 6 – subparagraph 1: “These expenses shall include reasonable costs of experts, including a representative of a recognised Community-level trade-union, for legal assistance, insofar as necessary for that purpose, as well as reasonable costs of legal representation and participation in administrative or judicial proceedings. Expenses shall be notified to central management before they are incurred.”;

Added:Article 1 – paragraph 1 – point 2 b (new), Article 3 – paragraph 2 – point c a (new): (2b) in Article 3(2), the following point is added: / (ca) operates directly or indirectly in the internal market selling goods or providing services through franchise or license agreements concluded with independent third-party companies in return for royalties where such agreements ensure a common identity, a common business name or concept and the application of uniform business methods.

Removed:Article 1 – paragraph 1 – point 4 – point a – indent 1: – points (b), (c) and (d) are replaced by the following:

Directive 2009/38/EC