(1)

Pursuant to Article 27 of the Charter of Fundamental Rights of the European Union (the ‘Charter’), workers or their representatives are, at the appropriate levels, to be guaranteed information and consultation in good time in the cases and under the conditions provided for by Union law and national law and practices. Principle No 8 of the European Pillar of Social Rights reaffirms the right of workers or their representatives to be informed and consulted in good time on matters relevant to them.

(2)

With regard to transnational matters, the objective of Directive 2009/38/EC of the European Parliament and of the Council (3) is to give practical effect to those basic principles by setting minimum requirements for informing and consulting employees in Community-scale undertakings and Community-scale groups of undertakings.

(3)

In its evaluation of Directive 2009/38/EC of 15 May 2018, the Commission confirmed the added value and relevance in principle of that Directive. It found that many of the Directive’s provisions are sufficiently flexible to accommodate evolving technological and economic realities and a variety of forms of undertaking or group. For example, it applies to all Community-scale groups of undertakings, regardless of the type of legal arrangements that allow the exercise of the dominant influence between the controlling and the controlled undertakings forming such groups. Consequently, undertakings linked, for instance, by franchise or license agreements can fall under the definition of Community-scale group of undertakings, provided that dominant influence is established.

(4)

However, the Commission evaluation also identified shortcomings regarding, for instance, the effectiveness of the consultation process, access to justice, penalties and the interpretation of certain concepts.

(5)

On 2 February 2023, the European Parliament adopted, pursuant to Article 225 of the Treaty on the Functioning of the European Union (TFEU), a legislative own-initiative resolution with recommendations on a revision Directive 2009/38/EC. Subsequently, the Commission carried out a two-phase consultation of the social partners pursuant to Article 154 TFEU on the need for and possible content of measures to address the shortcomings of Directive 2009/38/EC. The Commission also collected evidence through a study involving a targeted online survey, stakeholder interviews, workshops and an analysis of national case-law and of relevant provisions in national law.

(6)

Evidence shows that legal uncertainty regarding the concept of transnational matters has led to differences in interpretation and disputes. In order to improve legal certainty and reduce the risk of such disputes, it is necessary to clarify the concept of transnational matters. To that end, it is appropriate to clarify that Directive 2009/38/EC not only covers cases where measures considered by the management of an undertaking or group of undertakings can reasonably be expected to affect workers of that undertaking, of that group, or of any establishment of that undertaking or group, in more than one Member State, but also cases where such measures can reasonably be expected to affect such workers in only one Member State and the consequences of those measures can reasonably be expected to affect such workers in at least one other Member State. Such clarification is necessary in light of cases where an undertaking envisages measures, such as lay-offs, redundancies, the allocation of production activities or the outsourcing of activities, which explicitly target establishments in only one Member State but which can reasonably be expected to have consequences affecting workers of that undertaking, of that group, or of any establishment of that undertaking or group, in another Member State, for instance due to changes in the cross-border supply chain or in production activities. The concept of transnational matters covers measures which could affect employees in a substantial and not in a merely trivial manner and which do not concern only individual employees or ordinary operational decisions. To that end, it should be clarified that the scope of the potential effects of transnational issues on the workforce and the level of management involved are to be taken into account to determine whether a matter falls within the competence of a European Works Council.

(7)

The definitions of information and consultation in Directive 2009/38/EC include normative requirements. For the sake of coherence and legal clarity, it is appropriate to move those normative provisions to the article on the operation of the European Works Council and the information and consultation procedure for workers.

(8)

The election and appointment of employees’ representatives is governed by national law and practice. The national systems for the election and appointment of employees’ representatives vary among Member States. Employees’ representatives can be trade union representatives, where the national law or practice of a Member State so provides.

(9)

With a view to concluding an agreement establishing a European Works Council, central management is required to negotiate with a special negotiating body representing employees. To increase legal certainty in that regard, it should be clarified that central management is required to convene a number of meetings with the special negotiating body sufficient for both parties to reach such an agreement.

(10)

It is possible that members of special negotiating bodies need legal advice to carry out their tasks under Directive 2009/38/EC. It is however not sufficiently clear that they are entitled to have the associated legal fees covered. To that end, it should be clarified that central management bears such expenses when incurred by members of special negotiation bodies. Such expenses should be notified in advance by special negotiation bodies to central management. Where the precise amount of the expenses is not known in advance, an estimate of the expenses, including information about their nature, should be notified to central management. It is appropriate to limit central management’s liability for such expenses to reasonable legal costs, to ensure that central management is not liable for manifestly disproportionate costs, costs without a justifiable link to the provision of relevant legal advice, or costs created by manifestly unfounded, frivolous or vexatious claims. Moreover, Directive 2009/38/EC gives Member States discretion to lay down budgetary rules regarding the operation of special negotiating bodies and European Works Councils based on subsidiary requirements, having regard to the principle that expenses relating to the appropriate conduct of the special negotiating body’s functions must be borne by central management. The provisions in Directive 2009/38/EC referring to the number of experts to be funded by central management are therefore redundant and should be deleted.

(11)

Directive 2009/38/EC requires the parties to a European Works Council agreement to determine the venue for the meetings of the European Works Council. Those parties should also determine the format of such meetings, namely whether they are in person, online or hybrid, in order, inter alia, to avoid any doubt about their freedom to agree, on the one hand, to hold some or all of the meetings in a virtual environment, using online meeting tools, reducing the environmental footprint of meetings in line with Union, national and company emission reduction targets, while ensuring the meaningful and efficient sharing of information and consultation at a lower environmental and financial cost, and, on the other, to hold physical meetings which can offer a confidential environment that instils trust and provides an opportunity for exchanges in person.

(12)

There can also be uncertainty and disputes with respect to the coverage of certain expenses and access to certain resources during the operation of European Works Councils. In accordance with the principle of the autonomy of the parties, it is appropriate to require that certain types of financial and material resources be determined specifically in European Works Council agreements, namely the possible assistance of experts – such as representatives of recognised Union-level trade union organisations, technical subject-matter experts or legal experts –, the coverage of experts’ fees and the possible participation of experts in meetings. 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 requirement to provide the necessary training pursuant to Directive 2009/38/EC.

(13)

The requirement in Directive 2009/38/EC to take into account, where possible, the need for 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 balance, to be implemented by management and employees’ 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 European Works Councils or their select committees. In accordance with the case-law of the Court of Justice of the European Union (4), 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 national laws. Parties to European Works Council agreements should therefore be allowed the flexibility necessary to respect the legal and factual limitations to the positive action. For similar considerations, it is also appropriate to strive to achieve gender balance in the composition of the special negotiating bodies, so that gender balance is already promoted during the negotiation phase.

(14)

Evidence shows that the initiation of negotiations is sometimes delayed beyond the period of six months provided for 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.

(15)

When sharing sensitive information with members of special negotiating bodies, members of European Works Councils, or employees’ representatives in the framework of an information and consultation procedure, central management can require such information to be shared in confidence and prohibit it from being disclosed further. To prevent the excessive use of such confidentiality restrictions and to align the relevant provisions of Directive 2009/38/EC with the corresponding provisions in Directive 2002/14/EC of the European Parliament and of the Council (5), confidentiality restrictions should be possible only to protect the legitimate interest of the undertaking concerned. The existence of such a legitimate interest should be assessed on the basis of objective criteria to be laid down in national law. Moreover, when sharing information in confidence, central management should be required to provide at the same time reasons justifying confidentiality. The confidentiality restriction should be applied only for as long as the reasons for confidentiality persist. Setting up adequate arrangements to safeguard the confidentiality of sensitive information can instil trust and facilitate the sharing of such information, while protecting the interests of businesses and workers, including averting growing risks such as industrial espionage.

(16)

The possibility of central management not to transmit information to the members of special negotiating bodies, the members of European Works Councils, or employees’ representatives in the framework of an information and consultation procedure, should be limited to cases where such transmission would seriously harm the functioning of the undertakings concerned. For reasons of transparency and effective redress, central management should also be required to specify the reasons justifying the non-transmission of information in a way which allows for sufficient legal scrutiny, while not disclosing protected information.

(17)

With a view to increasing legal clarity, it is appropriate to lay down the provisions on the transmission of information in confidence and on the non-transmission of information in two separate articles. Moreover, the provision allowing Member States to lay down particular rules for undertakings pursuing the aim of ideological guidance should be moved to an article concerning the relationship with other national provisions, because it pertains to the implementation of the requirements of Directive 2009/38/EC more broadly.

(18)

Decisions on transnational matters can have far-reaching consequences for employees, such as in the case of redundancies arising from business plans, social plans, or process innovations. 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 is to be conducted in a meaningful and timely way that enables employees’ representatives to express their opinion prior to the adoption of the decision. It also implies that opinions issued by European Works Councils or employees’ representatives are to receive a reasoned response from central management or a more appropriate level of management before the decision on the proposed measure at issue is adopted. Explicit requirements to that effect should be laid down in Directive 2009/38/EC, to ensure legal certainty.

(19)

In the context of information and consultation on transnational matters, it is important to ensure that Community-scale undertakings or Community-scale groups of undertakings can take decisions effectively and that information and consultation does not result in undue delays in the decision-taking process. It is also crucial that employees’ representatives are provided with adequate time to form, coordinate and express their views on sometimes complex transnational matters, taking into account any agreed arrangements for linking information and consultation of the European Works Council and national employee representation bodies. To enable parties to reconcile those considerations in practice, the minimum requirements for the consultation process should remain sufficiently flexible, allowing them to schedule the process as appropriate in light of the respective circumstances and content of the consultation. Rather than imposing a rigid timeframe for employees’ representatives to issue their opinion and for management to provide a reasoned response, it is appropriate to provide for the principle that consultation is to take place within a reasonable time, taking into account the degree of urgency of the matter. That principle enables the parties to expedite the consultation process in urgent situations. It should also be clarified that the requirement for management to provide a reasoned response prior to adopting a decision applies where the employees’ representatives expressed their opinion within a reasonable time, with regard to all relevant circumstances, such as the complexity or significance of the matter, or management’s interests in taking a decision promptly.

(20)

The provisions of Directive 2009/38/EC on the role and protection of employees’ representatives should be amended to increase clarity and accuracy, in particular with regard to the protection of the members of special negotiating bodies and the members of European Works Councils against retaliatory measures or dismissals relating to the exercise of their functions. Members of special negotiating bodies, members of European Works Councils, and employees’ representatives in the framework of an information and consultation procedure, should enjoy, in the exercise of their functions, protection and guarantees equivalent to those provided for national employees’ representatives by the national law or practice applicable in their country of employment.

(21)

In order to avoid disputes, it should also be specified that central management bears the reasonable costs of training and related expenses of the members of the special negotiating body and of the members of the European Works Council, which are necessary for the exercise of their duties, where central management has been informed of those costs in advance.

(22)

In certain Member States, rightsholders under Directive 2009/38/EC encounter difficulties in bringing legal action to enforce their rights. It is therefore necessary to strengthen Member States’ obligations to ensure effective remedies and access to justice and the supervision by the Commission of their compliance with those obligations. With regard to rightsholders under that Directive, including special negotiating bodies and European Works Councils, Member States should, in accordance with national law on legal standing or on the form of legal representation, guarantee access to judicial proceedings and, where relevant, administrative proceedings to enforce the rights under Directive 2009/38/EC. Moreover, it should be clarified that the relevant proceedings have to enable timely and effective enforcement. Where Member States impose mandatory pre-judicial out-of-court settlement procedures, it is important to ensure that such requirements neither prevent parties from fully exercising their right of access to the judicial system nor make it in practice impossible or excessively difficult for them to exercise their rights under Union law, with regard to any delays, effects on time limits, costs and other potential obstacles (6). It should therefore be clarified in Directive 2009/38/EC that, where Member States render access to judicial proceedings conditional upon the prior implementation of an alternative dispute resolution procedure, that procedure should not prejudice or limit the right of the parties concerned to bring judicial proceedings. Moreover, for the purposes of supervision by the Commission, Member States should be required to notify the Commission of the manner and circumstances in which rightsholders under Directive 2009/38/EC can bring judicial proceedings and, where relevant, administrative proceedings, in respect of their rights under that Directive.

(23)

The Commission’s 2018 evaluation of Directive 2009/38/EC showed that penalties applicable in the case of non-compliance with transnational information and consultation requirements are often not sufficiently effective, dissuasive or proportionate. Therefore, it is appropriate to lay down an obligation on the part of Member States to provide for effective, dissuasive and proportionate penalties. Financial penalties should be provided for in the case of non-compliance with the information and consultation procedures set out in Directive 2009/38/EC. Other forms of penalties could also be provided for. In order to be effective, dissuasive and proportionate, penalties should be determined taking into consideration the gravity, duration and consequences of non-compliance and whether such non-compliance is intentional or negligent. For the penalties to be dissuasive, the turnover of the undertaking or group concerned should be taken into account or the applicable penalties should have a similarly dissuasive nature.

(24)

Special negotiating bodies, European Works Councils, and, on their behalf, their members should have the necessary means to cover the costs of legal representation and participation in judicial proceedings and, where relevant, administrative proceedings. Such costs can cover the travel and subsistence costs of participation in such proceedings of the members acting on behalf of the body concerned. The Member States should either provide for central management to bear the reasonable costs of legal representation and participation in judicial proceedings and, where relevant, administrative proceedings, or should take other, equivalent measures to ensure that special negotiating bodies and European Works Councils are not de facto prevented from participating in judicial proceedings or, where relevant, administrative proceedings, due to a lack of financial resources. This could be achieved, for example, by requiring the allocation of an appropriate operational budget to the European Works Council, the setting up of solidarity funds at national level, the provision of insurance to cover legal costs, the granting of access to legal aid in certain circumstances or other provisions in accordance with national law and practice.

(25)

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/EC (7), 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. 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 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, without prejudice to the legal status of such agreements, which continue to be governed by the applicable national rules. The initiation and conduct of negotiations for the establishment of European Works Councils in undertakings with such agreements should be subject to the procedure provided for in Directive 2009/38/EC, while the period after which the subsidiary requirements come into force should be reduced from three to two years, in line with the period applicable to the adaptation of existing European Works Council agreements.

(26)

Moreover, for the same considerations, the same minimum requirements should apply to all Community-scale undertakings with European Works Councils operating under Directive 2009/38/EC and those in which a European Works Council agreement was signed or revised between 5 June 2009 and 5 June 2011. Therefore, the exemption of the those undertakings from the application of Directive 2009/38/EC should also be deleted.

(27)

European Works Councils operating on the basis of the subsidiary requirements set out in Annex I 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 ordinary meetings in the subsidiary requirements to two meetings held in person.

(28)

In addition, certain technical changes should be made to the subsidiary requirements set out in Annex I to Directive 2009/38/EC, to ensure consistency with the enacting terms.

(29)

Therefore, it is appropriate to amend Directive 2009/38/EC to bring all eligible undertakings within its scope, clarify some of its key concepts, improve the transnational information and consultation process, and ensure effective redress and enforcement.

(30)

Pursuant to Article 27 of the United Nations Convention on the Rights of Persons with Disabilities, persons with disabilities are to be able to exercise their labour and trade union rights on an equal basis with others. As the Union and the Member States are parties to that Convention, Directive 2009/38/EC and relevant national legislation are to be interpreted in accordance with that principle, for instance in relation to accessibility and reasonable accommodation for members of special negotiating bodies, members of European Works Councils, and employees’ representatives in the framework of an information or consultation procedure, as well as the bearing of related costs by central management.

(31)

Pursuant to Directives 2014/23/EU (8), 2014/24/EU (9) and 2014/25/EU (10) of the European Parliament and of the Council, Member States are to take appropriate measures to ensure that in the performance of public contracts economic operators comply with applicable obligations in the fields of social and labour law established by Union law. The integration, as appropriate, of social sustainability criteria in the award criteria designed by contracting entities for identifying the most economically advantageous tenders can contribute to the effective implementation of the requirements under this Directive. However, this Directive does not create any additional obligation in relation to those Directives.

(32)

When implementing Union law, Member States are to respect the rights set out in the Charter and to promote the application thereof in accordance with Article 51 of the Charter, including the right to freedom of association at all levels, in particular in political, trade union and civic matters, which implies the right of everyone to form and to join trade unions for the protection of his or her interests.

(33)

In order to give employees’ representatives and central management in Community-scale undertakings or Community-scale groups of undertakings sufficient time to consider the revised minimum requirements and to prepare for their application, it is appropriate to defer by one year the application of the provisions adopted by Member States to comply with this Directive.

(34)

It is possible that European Works Council agreements concluded under Directive 94/45/EC or 2009/38/EC before the transposition of this Directive, do not address the requirements for the content of those agreements as amended by this Directive. It is therefore appropriate to provide for transitional arrangements enabling the parties to such agreements to amend their agreements.

(35)

Since the overall objective of this Directive, namely to ensure the effectiveness of the requirements of Directive 2009/38/EC regarding the information and consultation of employees of Community-scale undertakings and Community-scale groups of undertakings, cannot be sufficiently achieved by the Member States but can rather, by reason of the inherently transnational nature and scale of those requirements, be better achieved at Union level, the Union may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty on European Union. In accordance with the principle of proportionality, as set out in that Article, this Directive does not go beyond what is necessary in order to achieve that objective,

(1)

Article 1 is amended as follows:

(2)

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

;

(3)

in Article 3, paragraph 1 is replaced by the following:

(4)

Article 5 is amended as follows:

(5)

Article 6 is amended as follows:

(6)

in Article 7(1), the second indent is replaced by the following:

;

(7)

Article 8 is replaced by the following:

(8)

the following article is inserted:

(9)

Articles 9 and 10 are replaced by the following:

(10)

Article 11 is amended as follows:

(11)

Article 12 is amended as follows:

(12)

Article 14 is deleted;

(13)

the following articles are inserted:

(14)

Annex I is amended in accordance with the Annex to this Directive.