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BackWhat shall the future of EU Company Law look like? The EU Commission is presently in the process of clarifying within the scope of a public consultation whether it is necessary to adjust the European regulatory framework covering this sector to current developments. During a conference organised by the Social Democratic Faction in the European Parliament which was attended by trade unions, it became clear that workers’ involvement and participation rights of employees are at stake and have to be defended.
Until recently, the harmonisation of the Company Law at EU level, which is to provide equal protection to shareholders, creditors and other actors, has been important for the European Commission to promote the Internal Market. Relevant prestige projects include European legal forms for businesses, such as the European Company, which was introduced in 2004. From the point of view of employees, the key aspect of the discussion about the future development of the European Company Law is to ensure that participation by employees is protected and not undermined.
Aline Conchon, researcher at the European Trade Union Institute, argued that the European Company statute could theoretically be used to bypass co-determination rights by employees on boards of directors or supervisory boards. After all, the forms of participation are only negotiated before the establishment of a European Company and not at a later date - even if the number of staff employed by the company would change in the meantime.
Sustainable enterprise model must focus on employees
Claudia Menne of the European Trade Union Confederation (ETUC) called for a new sustainable enterprise model. This could not be achieved without employees having information and consultation rights. Greater focus on stakeholders, i.e. employees, and less focus on the short-term perspective of the shareholder value of a company was needed. ETUC demands the creation of a framework instrument for the involvement of employees. The demands, for example, include a re-evaluation of the main seat of enterprises. It had to be prevented that enterprises relocate their registered seat on paper to countries with lower standards of workers’ involvement, thereby bypassing the rights of employees in the country of their actual business activity.
Professor Jonas Malmberg, Faculty of Law at the University of Uppsala, based his comments on the report of the Reflection Group set up by the Commission ‘On the Future of EU Company Law’, which was published in spring 2011. The Reflection Group views participation at board-level from the perspective of the benefit it has for the performance of a company and believes that it has neither a positive nor a negative impact on it. However, according to the Treaty, employee participation is still seen as a part of EU Social Policy, underlines Malmberg. One of its objectives would be to improve the social dialogue, which was a value in itself.
Michael Petersen, Chairman of Honeywell's European Works Council, brought his experiences with practical employee representation to the debate. He commented that when a European Works Council would be heard, the relevant decision had long been taken; this should be changed. He also called for giving European Works Councils the power to adjourn a decision.
Gyula Cserey of the Directorate General for Employment in the Commission referred to the ongoing public consultation on the future of EU Company Law. It was the aim of the Commission to adapt the Company Law after the crisis to the new political and economic landscape. The Commission intends to present new guidelines and proposals on Company Law and Corporate Governance in October - hence, the debate will continue to be very interesting.
Further information:
Information of the European Commission on EU Company Law
Aline Conchon, researcher at the European Trade Union Institute, argued that the European Company statute could theoretically be used to bypass co-determination rights by employees on boards of directors or supervisory boards. After all, the forms of participation are only negotiated before the establishment of a European Company and not at a later date - even if the number of staff employed by the company would change in the meantime.
Sustainable enterprise model must focus on employees
Claudia Menne of the European Trade Union Confederation (ETUC) called for a new sustainable enterprise model. This could not be achieved without employees having information and consultation rights. Greater focus on stakeholders, i.e. employees, and less focus on the short-term perspective of the shareholder value of a company was needed. ETUC demands the creation of a framework instrument for the involvement of employees. The demands, for example, include a re-evaluation of the main seat of enterprises. It had to be prevented that enterprises relocate their registered seat on paper to countries with lower standards of workers’ involvement, thereby bypassing the rights of employees in the country of their actual business activity.
Professor Jonas Malmberg, Faculty of Law at the University of Uppsala, based his comments on the report of the Reflection Group set up by the Commission ‘On the Future of EU Company Law’, which was published in spring 2011. The Reflection Group views participation at board-level from the perspective of the benefit it has for the performance of a company and believes that it has neither a positive nor a negative impact on it. However, according to the Treaty, employee participation is still seen as a part of EU Social Policy, underlines Malmberg. One of its objectives would be to improve the social dialogue, which was a value in itself.
Michael Petersen, Chairman of Honeywell's European Works Council, brought his experiences with practical employee representation to the debate. He commented that when a European Works Council would be heard, the relevant decision had long been taken; this should be changed. He also called for giving European Works Councils the power to adjourn a decision.
Gyula Cserey of the Directorate General for Employment in the Commission referred to the ongoing public consultation on the future of EU Company Law. It was the aim of the Commission to adapt the Company Law after the crisis to the new political and economic landscape. The Commission intends to present new guidelines and proposals on Company Law and Corporate Governance in October - hence, the debate will continue to be very interesting.
Further information:
Information of the European Commission on EU Company Law