EWC
A body for workers’ and employer’s cooperation in transnational companies in
European Union
What does EWC stand for?
• EWC stands for: European Works Council.
What is EWC?
• EWC is an official platform where the employer of
a transnational European company and it’s
workers’ representatives can sit down to work
together and discuss important issues about their
work and the company.
• Companies may choose to name this platform
other than EWC.
Is EWC mandatory?
• According to the 2009/38/EC directives, EWC’s
formation is mandatory when a company has at
least 100 workers in an EU/ETA-country and 150
workers in at least two EU/ETA-countries.
• Corresponding law in Finland is the Act on Cooperation within Undertakings (334/2007). The law
is based on the older directive from the year 1994.
The new directive will be implemented into the
Finnish Law by early June 2011.
Why EWC?
• EWC is a possibility for the staff representatives
to learn about their company and discuss its
future.
• In EWCs representatives are able to compare
how the laws and agreements solve work related
issues in other countries.
How does EWC work?
• Some EWC’s exists only on paper. In other words,
the company has not understood how to benefit
from the EWC.
• Some EWC’s work very well. In these EWC’s,
workers are able to influence and participate in
their company’s decision making and everyone
benefits from the dialogue.
Here’s how it works:
Imagine there is a Company Ltd
Company Ltd has manufacturing plants in three different
countries and marketing organizations in yet another three.
2 000
employees
800
employees
1 000
employees
100 employees
50 employees
150 employees
The company has signed an EWC agreement. That is to say the
agreement on ”Group Company Co-operation”. In this agreement the
total number of EWC representatives the workers have and the
number of representatives allocated to each country is stated .
2 000
employees
100
employees
EWC
800
employees
1 000
employees
50
employees
150
employees
EWC agreement
• Each company has its own individual EWC
agreement.
• The agreement stipulates how to participate in
the council, who represents whom, how the
communication is to be carried out and many
other details.
• The terms of the agreement vary according to
the laws of the nationality of the corporation.
Nationality is determined by the location of the
headquarter.
The company is usually represented by either the managing director
or the personnel director or both. Managing Director knows what
business plans there are. Personnel Director knows what the policy in
the company’s work agreements is.
Company
Managing
Director
Personnel Director
Employees
EWC
In Finland employees are represented by an elected employees’
representative. In some countries a union officer may represent the
employees. In countries where organization rates are low workers must
learn how to elect a representative. The first election is always the most
difficult one. It helps if good practices are shared among representatives
form different countries.
Company
Managing
Director
Personnel Director
Employees
EWC
In EWC meetings, representatives can discuss for e.g. what
business plans the company has.
Company
Managing
Director
Personnel Director
Employees
EWC
Our production line B is no
longer profitable. We intend to
sell it away. Instead we want to
buy company N which will give
us a new production line H.
Managing
Director
EWC
Personnel Director
Company
Employees
This would mean a
personnel reduction of 600
employees in our Finnish
plant and closing down our
Estonian sales organization.
The new company which we
intend to buy, will probably
be situated in Belgium and
add 400 new employees.
Managing
Director
EWC
Personnel Director
Company
Employees
Our most profitable products are customized products manufactured in
Production lines A and C. The tools and know-how needed for these
commissions are provided by the employees from Production line B. If
we were to sell off Production line B, we would also lose our strategic
know-how.
Managing
Director
EWC
Personnel Director
Company
Employees
Now, this is something to think about. According to
our customer survey, quality is the key to our success.
Fortunately we presented this plan first to you and not
the Board. We need to think about this more.
Managing
Director
EWC
Personnel Director
Company
Employees
How does EWC benefit the company?
Company
Employees
Employees have intimate knowledge on
what actually happens at work. By listening
to them, management gets information it
wouldn’t get from anywhere else.
Managing
Director
Experience has proven, that when
employees can influence their work, they
will be more motivated and committed.
Through the EWC, the employer can also
benefit from the representatives’
knowledge of the laws, agreements and
customs in different countries.
EWC
Personnel Director
How does EWC benefit the workers?
Company
Employees
•Employees get to be heard and
get an opportunity for equal
treatment even when decisions
concerning their work are made
in an other country.
Managing
Director
Personnel Director
EWC
•Dialogue between
representatives from different
countries help employees
understand their company and
communication cultures in
different countries.
How does EWC benefit the employees’ representative?
Company
Employees
•Representatives get information and an
opportunity to influence the decisionmaking
Managing
Director
EWC
•Representatives learn to understand
how employers think.
•They learn languages and gain
presentation skills.
Personnel Director
•Experience from working with
representatives of different countries
broadens one’s mind. It is a good way to
learn more about union practices and
collective bargaining.
How does EWC benefit a union?
Company
Workers
Association
Trade Union
EWC
Managing
Director
Personnel Director
•In transnational companies employees are hired
and fired and collective bargaining tried out. Best
practices tend to set a model. This model may in
time become basis of an EU directive and after
that get to be implemented in work laws of all
member states. EWC representatives are the
forerunners, who have the opportunity to
influence these practices when they are just
beginning to form.
How does EWC work in practice?
Company
Managing
Director
Personnel Director
Employees
EWCmeeting
Company agrees on an ”international cooperation within Group companies” –
agreement, which stipulates for e.g. how
often the EWC-representatives meet. The
agreement stipulates also other important
meeting practices, such as who can
propose items on the agenda, time
schedule of such proposals, whether it is
mandatory for each country to have a
representative, is there a deputy system…
The 2009/38/EC Directives provides
guidance on the minimum number of
delegates in a meeting and directs that the
EWC should meet at least once a year.
There are few limitations on the quantity of
delegates and the number of meetings as
long as the minimum requirements are met.
The employee representatives must always be given the
opportunity to have their own meeting before and after
EWC-meetings.
Company
Employees
Managing
Director
Personnel Director
EWCmeeting
For effective interaction, one or two meetings a year are not enough. In business
life, plans and decisions are being made all the time. What the EU directive aims
at, is that employees should have an opportunity to influence. This aim will not be
fulfilled if corporate decisions are only made known to employees afterwards.
Therefore annual EWC-meetings are supplemented by working committees. They
consist of fewer people and can be summoned easily. It is also possible to form
other work groups to take a stand on upcoming matters.
Company
Employees
Work
committee
Managing
Director
Personnel
training work
group
Annual
EWC- meeting
Strategy
work group
Personnel Director
R&D work group
Employees receive information about decisions and their rationales
through their own representatives. Through representatives a
genuine dialogue and possibility to influence is made available to all
employees.
€ m
o a
€ m
k
o a
§s
l
s
k
§
l
Personnel
training work
group
Work
Committee
m
€ o
a
k
l
s
o € m a
k
§
R&D work group
l
Strategy
work group
§s
Employees receive information about decisions and their rationales
through their own representatives. Through representatives a
genuine dialogue and possibility to influence is made available to all
employees.
a
§m y € t
h
Work
committee
Personnel
training work
group
t
§m y €
a
h
a h
§m y €
t
t
h
§m y €
a
Strategy
work group
R&D work group
§m y €
h a t
How to start EWC in a company?
When a company becomes a multinational company e.g. , through acquisition,
either management or the employee representatives of at least two countries will
propose to call a meeting of a Special Negotiation Body (SNB). The body will
make the preparations for the starting of the EWC.
It is not wise to wait too long for the employer to take initiative. In Europe there
are about 2000 companies, where there should, according to the law, be an EWC
but only about 850 where one has been established.
I propose to call for an SNB meeting.
Employee representative
Managing
Director
Special
Negotiation
Board
SNB
Personnel Director
Employee
representative
I support the proposal.
The SNB shall be represented by at least one representative from each
EU member state, where the company operates. The employees get one
additional representative for each 25% of employees of the total number
of employees in Europe. (This may change with the new law.) An SNBrepresentative represents all groups of employees in his or her country.
Management
Production
Production
workers
Production workers
Managing
Director
Special
Negotiation
Board
SNB
Administration
Production
Workers
Sales
Administration
Sales
Personnel Director
Management
Sales
SNB negotiates the international co-operation of the Group companies.
The agreement will form a base for the future co-operation function. When
an agreement is achieved, the SNB will be dissolved and its work will be
continued by the EWC. The same persons, however, may continue to work
in the EWC. Trade unions provide support and expertise in the
negotiations.
Employee representative
Management
Production
Employee representative
Workers
Production
Employee representative
Workers
Production
Managing
Director
Personnel Director
Special
Negotiation
Agreement
Board
SNB
Employee
representative
Administration
Production
Employee representative
Workers
Sales
Employee representative
Administration Sales
Employee representative
Management
Sales
What does EWC-agreement cover?
Total number of EWCrepresentatives, manner
of election, duration
of their term
Scope of financial
resources,
how many days, etc.
Number of meetings per year,
where meetings take place
Agreement on Group
Company co-operation
How long is the
agreement valid and
when must it be
renewed
Methods of
information and
communication
Agenda of
meetings
Language, use of
interpreters
Group companies’ structure, financial
sitution, business and employment
Prospects, transfer of production,
fusions…….
Always consult your national union when
negotiating the terms of the agreement.
You will benefit from their experience.