Co-determination in Germany at establishment level refers to the representation of employees of a company. The employee representatives, who are elected by the staff, have participation and co-determination rights in the employer's decisions. Forms of co-determination at establishment level include
Co-determination in Germany at corporate level is a comparatively powerful instrument in the possession of the elected employee representatives because the employer and the employee representatives have the right to decide at equal level within the statutory limits (so-called principle of positive consensus).
A decision taken by the employer without the compulsory participation of employee representatives, for example, may be legally ineffective and, hence, incapable of effectively shaping the legal relationship with the employees (so-called theory of conditional effectiveness, according to which the effectiveness of any measures taken by the employer is conditional upon the implementation of co-determination rights).
In an extreme case, the employee representatives could in fact paralyze a business unit in Germany, e.g. by objecting to the work schedule prepared by the employer.
Co-determination at establishment level (betriebliche Mitbestimmung) differs from co-determination at company level (unternehmerische Mitbestimmung).
Whether at establishment or at company level, co-determination in Germany relates to the interests of employees. However, especially the latter has a major influence on the daily work at the company.
Co-determination is relevant both in private companies and in public sector establishments.
If a German company comprises more than one establishment, a company works council may be formed. Within a group structure, the existing company works councils may establish a group works council to represent the employees' interests throughout the group.
Elections of works councils or employee representatives are subject to detailed statutory regulations and may be challenging especially for companies and public sector establishments that are faced with an election of a staff representative body for the first time. As both, organizing and holding elections, are complex matters, companies that wish to avoid mistakes should definitely seek expert assistance by a German attorney.
Mistakes affecting the election may render the election voidable and/or void. An already constituted staff representative body may be dissolved after a lengthy and costly court procedure and must be newly elected thereafter. Both, the procedure itself and the new elections, involve substantial costs that can be avoided by obtaining legal advice from the beginning of the election procedure. We will be pleased to advise you on any aspects concerning the election of a staff representative body within your company or public sector establishment.
Besides, the next regular works council election in Germany will be in 2022 and should thus be prepared in good time.
The range of objects that are subject to co-determination in Germany at establishment level in the private and public sectors is broad:
Given the large number of topics requiring an involvement of staff representative bodies, employers should always seek legal advice to ensure they keep an overview and safeguard their rights at all times. Our employment law attorneys offer competent support in realizing your projects in a legally secure way.
Employers in Germany should exploit the opportunities for co-determination at establishment level and cooperate in a trustful manner with their respective staff representative body. A trusting cooperation with the respective staff representative body usually has a positive effect on the workplace atmosphere, motivates employees, and may produce valuable synergies.
A difficult relationship with the staff representative body, on the contrary, may entail organizational and costly problems in operation processes and is a source of discontent.
To ensure that you, as an employer, succeed in walking the fine line between the preservation of your rights and interests and a trustful cooperation with the staff representative body, our employment law attorneys support you in a competent and reliable manner through advice as well as in negotiations with your staff representative body and assist you in preparing and concluding collective bargaining arrangements, such as company agreements or establishment agreements.
If a legal conflict cannot be avoided in an individual case, we will also assist you in safeguarding your interests at the arbitration committee or before the labor courts.
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