IR Notes

The European Court of Justice has issued a judgement concerning redundancies imposed in two retail chains, resulting in several thousands of dismissals (see press release. The directive on collective redundancies provides for employee representatives to be consulted on the redundancy plan when at least 20 employees are to be dismissed over a period of 90 days, “whatever the number of workers normally employed in the establishments in question”. Employees working on sites with fewer than 20 employees sought a protective award on the grounds that the consultation procedure had not been followed. The question referred to the Court was whether the thresholds for consultation should be construed at company level, taking all of the affected establishments into account, or only at the level of the individual establishment. In the eyes of the Court, what must be taken into account is each “particular establishment” of an undertaking, rather than the aggregate number of dismissals across all of the establishments of a company. The employer therefore did not need to consult the employees affected in establishments having fewer than 20 workers. This decision thus deprives employees in undertakings operating as a network of small entities of their right to consultation.

• Relaunch of social dialogue: In a policy brief, the IndustriAll trade union federation expresses its doubts about the European Commission’s intention to relaunch social dialogue. IndustriAll denounces the decreasing resources being devoted to sectoral social dialogue and the failure to respect the European social partners’ autonomy by introducing a cost/benefit analysis of their agreements.

• Electricity: The European social partners in the electricity sector have sent a joint letter to the European Commission to express their concern about the absence of a social dimension in its plan to form an Energy Union.


• Construction: The social partners in the construction industry have presented their joint proposals for combating social fraud to the European Commission. In particular, the partners call for greater legal clarity as regards the position of temporary agency workers in the framework of posting.

• Annual leave: The European Commission has asked Denmark to respect the right of workers to take their minimum paid annual leave in the year in which it was accrued. At present, workers newly entering the labour market cannot take any annual leave in the first year of employment, and some employees with fixed-term contracts cannot take annual leave at all while employed (press release).

• Parental leave : on 27 April the government presented a bill to reform parental leave which: 1. Raises the minimum allowance from 1,778 to 1,922.96 euros per month; the allowance is to become proportional to income up to a ceiling of 3,200 euros per month. 2. Grants greater flexibility to parents when taking parental leave (six months in the case of a full-time worker), which is to be formalised in a “parental leave plan” worked out with the employer.

• Health and safety: the labour minister, Fatima Baneza, has presented the Strategy for health and safety at work 2015-2020 together with the general secretaries of the CC.OO and UGT trade union confederations and the chairman of the CEOE employers’ organisation.

Deutsche Börse: A judgement handed down in first instance by Frankfurt-am-Main regional court alters the way in which workforce thresholds are appraised for the application of co-determination. German legislation provides that companies with between 500 and 2,000 employees must reserve one-third of the seats on the supervisory board for employee representatives; this goes up to one-half when the workforce reaches 2,000. This calculation includes only employees working on German soil. Now, in the case of Deutsche Börse, the court has found that not only the 1,624 employees in Germany, but also the 1,747 working in other EU countries should be taken into account. If confirmed, this judgement would have a significant impact on the application of co-determination in Germany, exposing a large number of companies to similar claims. As a possible side-effect, companies might pursue a practice of locating their head office outside Germany, or opt for conversion to a European Company (SE) (see below).

• OHB: The German company OHB, which is active in the space technology sector (more than 2,000 employees in Europe), has been converted to a European Company (SE) after concluding an agreement on the participation of employees in the SE with negotiators representing employees from six countries (see company press release). With 1,700 employees on German soil, OHB was close to reaching the workforce threshold of 2,000, at which co-determination involving the reservation of half of the seats on the supervisory board for the employees becomes mandatory. The agreement that has been signed allows this rule to be circumvented and provides for co-determination of one-third if the workforce reaches the 4,000 mark in Germany or 5,000 at European level.

• Coca-Cola: The Spanish Supreme Court on 15 April delivered its ruling concerning the reorganisation decision taken by Coca-Cola in Spain, affecting four production locations (821 redundancies). The unreported decision rules that the dismissals are invalid on the grounds that, in breach of the law, the company made use of subcontractors during the strikes organised by workers at the sites concerned.

• Slight decrease in the proportion of part-time workers wishing to work more hours: According to a study by Eurostat, 9.8 million part-time workers were underemployed in 2014, meaning they wished to work more hours and were available to do so. They represent 22.2% of part-time workers. This total signifies a slight downturn, since the 2013 percentage was 22.7% (compared to 18.5% in 2008).


• Reduction in collective disputes in Germany: According to a review produced by the Institute of Economic and Social Research (WSI), there was a reduced level of conflicts in 2014. The study recorded 214 strikes linked to the renegotiation of collective agreements (compared to 218 in 2013), 392,000 days of work lost (down well over 25% compared to 2013) and 345,000 workers who had taken part in industrial action (nearly two-thirds fewer than in 2013).