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1. The restructuring
wave rolls -
what is the legislator doing?
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European
Parliament demands revision of the EWC Directive
 The
European Parliament in Strasbourg demanded in a resolution on
10th May 2007 to update the legal provisions for information
and consultation and
particularly the EWC Directive. The EU Commission shall present
a concrete time schedule for this. Already on 25th April 2007 a
discussion took place whereby several Members of Parliament used
current examples (Airbus, Alcatel-Lucent, Delphi Systems,
Volkswagen) to highlight the need for action of the legislator.
The Parliament thus followed the European Economic and Social
Committee, which after a crucial vote in September 2006 had
asked for urgent action.
Since spring 2004 the revision procedure has run without result.
Shortly
before the debate in the European Parliament and for the day
exactly three years after the beginning of the revision
procedure the European Trade Union Confederation (ETUC) convened
about 200 European works council members for a meeting
in Brussels on April 20th, 2007. In the presence of Commissioner pidla
and the European employers' confederation BusinessEurope they
stressed the demand for a revision of the EWC Directive. At this
meeting a documentation on methods of action for European works
councils in the course of restructuring was presented, covering General Motors, InBev, RWE Energy and Dim Branded
Apparel.
The
ETUC congress, which met in Seville (Spain) from 21st to 24th May 2007 also asked for strengthening the European works
councils. It named the key activities in a manifesto:
"fight
delocalisation, stimulate negotiations on restructuring and
provide a stronger framework of
information, consultation and involvement, including involving
independent experts on restructuring."
The
new person in charge of EWC issues at the ETUC
At
the congress the head of the ETUC was regularly
newly-elected. Since then the Deputy General Secretary Reiner
Hoffmann (photo) from Germany is responsible for the topic
workers' participation, which also includes the European works
councils. He was interviewed
about his priorities and current developments by our newsletter editor Bernhard Stelzl.
More staff news from BrusselsThe
education department of the European trade union institute
(ETUI-REHS) in Brussels has got personnel reinforcements on 1st July 2007. A long-standing member and chairman of the European
works council of the Dutch Fortis bank, Bruno Demaître, will
organize EWC seminars.
Survey
of IG Metall trade union: The practice is further than the legislator Concrete
practice is of decisive importance against the
background of a blocked legislation process. Besides the
Europe-wide survey of Prof. Waddington from the year 2005 (see interview) IG Metall has also carried out
two surveys in Germany. Results of the first survey were already presented
in November 2005 at an EWC conference in Hanover. The key finding was that out of
85 interviewed councils 70 were confronted with cross border
restructering. At
the second survey of IG Metall in 2006, 28 European works
councils were examined more exactly, which conducted a special
meeting on the occasion of restructering – either with the
complete council or with the select committee. In the opinion of
Dr Aline Hoffmann, leader of the EWC team in the head office
of IG Metall, the lived
practice overtakes the regulations laid down in EWC
agreements. As she explained to EWC News, “the initiative of
the EWC members is rather decisive”. In most of the cases a
special meeting was possible at short notice and opened new
chances to get locally active. However some weak points became
apparent. In some cases there were no internal preliminary
meetings of the workers' side, not all locations concerned
were included, or there were no interpreters available.
European works councils don't wait for the legislator To improve their work opportunities, European works
councils negotiate often a new EWC agreement.
Some of them were listed in the magazine “Arbeitsrecht im
Betrieb” in January 2007.
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2. Participation
rights after the merger
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 New
EWC agreement with extended rights
The
buying up of the British BOC Group by the conglomerate Linde did not only lead to an extensive
reorganisation of products and locations but also in the
composition of the employee committees. While the head office of
the gasses and engineering company was transferred from
Wiesbaden to Munich and the fork truck division was sold,
numerous members left the European works council.
 The
new German and European works council
chairman Gernot Hahl (photo) did his best to enlarge the
Linde EWC immediately with BOC representatives and to use the
merger for a renegotiation of the EWC agreement. The text signed
on 27th June 2007 provides for three annual meetings.
Third-party funded projects, which serve the strengthening of
the international cooperation of the workers' representatives
are sponsored by the company in future. Our newsletter editor
Kathleen Kollewe talked about the course of the negotiations and
further advantages of the new agreement with the EWC chairman.
The
28 members of the new EWC will come together for the first
meeting in November 2007. The UK gets seven seats, Germany six,
the Netherlands and France two each and all other countries one seat each
(Finland, Sweden, Norway, Ireland, Spain, Italy, Austria,
Poland, Czechia, Hungary and Romania). The EWC is chaired by a
five-headed select committee.
Personnel
support for the EWC Jacques
Bister
has worked as a scientific expert for the German
group works council and for the European works council since 1st
April 2007. Before he was a union officer at the German Mining, Chemical and Energy Industrial Union (IG BCE) and
he has
long-standing experiences in the cross border cooperation of
workers' representatives. Bister is co-editor of a dictionary for
the international trade union work (see report in EWC News
1/2007).

After the world's biggest steel merger: New EWC agreement complete The signing of the EWC agreement for ArcelorMittal took place on
9th July 2007 in Luxembourg in the presence of Lakshmi Mittal (photo). The Indian multi-millionaire will take on the chairmanship of the EWC according to French habits although particularly IG Metall trade union would have preferred the German model with a workers' representative as a chairman. The negotiations
on the merger of
the two European works councils of Arcelor and Mittal Steel had
been concluded in Spain on 18th April 2007 (see report in EWC News
1/2007). 54 delegates belong to
the new EWC out of the following countries: France and Poland
(nine mandates each), Belgium and Romania (eight each), Germany,
Spain and Czechia (five each), Luxembourg (three) as well as Italy (two
mandates). The workers' representatives choose a three-headed
secretariate and a select committee of 25
members. The
new agreement adopts the essential features of the previous
Arcelor agreement and meets the demands of the trade unions. Besides an employee
participation in the administrative board the agreement provides
participation rights for the EWC like in the SE Directive which
goes beyond the regulations of the EWC Directive at some points.
ArcelorMittal thinks about a transformation to a European
company (SE).
  Merger leads to the loss of supervisory board seats
On
4th May 2007 the European Commission had allowed the take-over of the British tour operator MyTravel by the German tourism group Thomas Cook. The new
company will have its seat in London and will be based on British
legislation. The functions of the executive board and the supervisory board are then united in a
management board which does not know any workers' directors.
The workers' directors in the previous German supervisory board of Thomas Cook lose their mandates
with that. All the more important will be the role of the European works council in future. Negotiations of its working conditions started at the beginning of August 2007. At Thomas Cook an EWC was already installed in 2003, at My Travel in 2006. Recently the recognition was renewed for the more than
1,000 employees at Thomas Cook in the United Kingdom and an Employee Consultation Forum (ECF) was founded, which is comparable with a
company-wide national works council. The following texts are only available in German:
 Restructuring
without works council?
In
the course of the merger between the two network divisions of Siemens and
Nokia 9,000 jobs shall be cut. The company Nokia Siemens Networks
(NSN) set up on 1st April 2007 does not have any EWC yet which
could be consulted over the restructuring plan (see report in
the EWC News 1/2007).
After
protests of the European Metalworkers’ Federation (EMF)
central management explained for the first time
its workers' representatives the plans on 25th´May 2007 in
Brussels. Though it is not clear yet to which degree which countries
and locations will be affected by the reduction, but first signs
point to figures of 1,700 in Finland and 2,900 in Germany primarily in the
research and development area. A further downsizing is feared in
Belgium, Spain and the Netherlands.
On 12th June 2007 the EMF organized a Europe-wide day of action. The NSN staff protested
against the restructuring plan in Düsseldorf, Berlin, Espoo (Finland), Cassina and Marcianise
(Italy), also
in Spain, Belgium, France, Austria and the Netherlands. A few days
later central management agreed to enter into
negotiations on the establishment of an EWC.
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3.
Reports from the courtroom
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 Federal
Labour Court permits union agreements on plant level
On
24th April 2007 the German Federal Labour Court (BAG) in Erfurt
clarified: Collective agreements negociated by unions on plant
level have
priority before agreements negociated by works councils. The core of the
decision was dealing with the issue whether the peace clause as
laid down in the Works Constitution Act (a German feature to be
explained abroad only with difficulty) basically applies during
restructering or whether the freedom of association including
the right to strike applies. This BAG decision brings the
collective labour law in Germany closer to European
normality. The following
texts are available only in German:
 Information rights of the EWC: Judges draw up criterias
A court in Paris
determined on 27th April 2007, which information the employer must disclose to the European works council in case of Europe-wide restructuring. The European Committee for Information and Dialogue (ECID) of the telecommunications supplier Alcatel-Lucent,
where several thousand jobs are to be cut after the merger, had
taken legal action. Central management had not justified this reduction and pointed out to "synergy effects" only generally (see
report in EWC News
1/2007).
The employer argued in front of
the court that the ECID is merely a committee of social dialogue and not a full European works council. As such it would not be entitled to the rights of information and consultation in accordance with the EWC Directive because the committee had been founded 1996 on a "voluntary" basis before the national EWC laws came into force. Until present such agreements enjoy the right of continuance according to article 13 of the EWC Directive. The court followed this position, the workers' representatives also cannot refer to the EU Directive on information and consultation from the year 2002.
"The management of Alcatel-Lucent was sentenced!"
The court nevertheless came to the opinion that the
central management has not complied sufficiently with its duties of information
and consultation. The judgement was immediately
published by the French unions in a joint handbill (click
on the picture on the right for extending). The employer must
present the following:
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a
precise, figured report on the reasons for closure,
relocation and merger of business activities
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a
precise, figured exposition of the calculation method and
the elements which were used for the calculation of the
alleged staff overhang
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the
number of planned job cuts, and to be more precise for every
division and for every country, separated into employee
categories
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exact
and figured grounds for this distribution and the time
schedule for the planned downsizing.
This
information must be "complete and precise enough, to
explain the employment trend on an European level
to the EWC and to allow for an exchange of views and dialog with
the management in view of full knowledge of the facts". At
the earliest 15 days after disclosure of all information
mentioned above a special session of the EWC can take place to
decide on a statement. According to this judgement central
management of Alcatel-Lucent is not obliged, however, to present
a redundancy scheme to the EWC, because firstly this is not a
component of the EWC agreement and secondly, results from the
participation rights of the works councils in single countries.
The EWC does not enjoy any priority compared to the national
works councils. In the opinion of the court participation and
consultation rights in countries concerned may not be postponed
on the grounds, the EWC must be informed completely first.
Only
limited expert support
Following
once more protests at the companys' general meeting in Paris on
1st June 2007, central management
finally presented the information demanded by the court in the
middle of June 2007. The ECID does not have any claim to an own expert, however. It can only count on experts who advise the
French group works council. For this reason a sound evaluation of the presented
financial data is only restrictedly possible. The ECID delivered a statement
on the restructuring on 4th July 2007.
 Newsletter
of the EMF explains judgements
The
European Metalworkers' Federation (EMF) explains some judgements
in EWC matters in the "newsletter on company policy".
 A
Finnish company must bear redundancy scheme costs in
France
The
highest French court of justice ("Cour de cassation")
condemned the Finnish electronic company Aspocomp to bear
redundancy scheme costs in the amount of 11 m. € for its
former factory Évreux in Normandy on 19th June 2007. The
dismissals had been justified with economical reasons in 2002,
however, in opinion of the court, been carried out improperly. Now
the central management in Espoo must pay for costs which would
have had to be borne by the meanwhile insolvent French subsidiary.
The
judgement is based on EU law and was only possible because the
company has its head office in the European single market. In
comparable cases of insolvency, e.g. the glass plant of LG.Philips
Displays in Aachen or the
German locations of the mobile telephone manufacturer BenQ,
central management could abscond from their responsibility
in Asia. This shows the significance of EU legislation as
an example for social arrangements of the globalisation.
 A British judgement strengthens information rights
For the first time a court in the UK adjudicated on the basis of the EU Directive on information and consultation on
24th July 2007. The Employment Appeal Tribunal in London decided on application of the union Amicus against the newspaper publishing house Macmillan, a subsidiary of the German Holtzbrinck group. British management has refused insistently to recognize an employee representation and to disclose financial
data for years. Since it came neither at the completion of a company agreement nor to the compliance with the legal minimum regulations then being valid, Amicus started legal steps in
June 2006.
Macmillan ignored, however, the ruling of the Central Arbitration
Committee (CAC), an independent arbitration
board which in actuality proceeds as the first instance concerning
industrial law in such matters. Therefore the London court
condemned the publishing house to the payment of a penalty of 55,000
£ (82,000 €), maximum penalty would have been
75,000 £. Obviously the judges wanted to set an example and to deter other
companies from seeing violations against EU employee rights as peccadillos.
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 TV
chain of Berlusconi founds EWC
On
14th
December 2006, an EWC agreement was signed according to
Italian law for the Italian media group of Mediaset in which the
financial holding Fininvest of the former prime minister
Berlusconi is involved substantially. Six members from Italy and
two from Spain which meet once a year belong to the EWC. One
delegate each per country coordinates the cooperation between meetings, they form a kind of "mini-committee".
Germany is not affected by this agreement because the take-over
of the TV station chain ProSiebenSat.1 Media by Mediaset
had failed in November 2006. In May 2007 Mediaset bought a share
in the Dutch TV producer Endemol ("Big Brother"), what
could possibly lead to an expansion of the scope of the EWC
agreement. Endemol is represented in five European countries,
among them in Germany.
Negotiations
completed successfully in the Bauer publishing house
On
the same day as in the case of Mediaset an EWC agreement was signed for
the Bauer publishing group in Hamburg, too. The
negotiations had been extended over more than two years and were
characterized by a heavy
blockade attitude of the employer. So
e.g. the chairwoman of the special negotiation body (SNB)
received an official warning for participating in a
seminar on EWC formation. The agreement became effective on 1st February 2007
and provides for an eight-headed EWC with a three-headed
presidium. Besides Germany (three delegates) France, Spain, UK,
Poland and Czechia are represented with one delegate each. The
constituting meeting is planned for December 2007. The following
documents are available only in German:
After
the sale: Turbine manufacturer founds EWC
On
pressure of the European Commission the French engineering
company Alstom had to hive off some business divisions. So was the
production of power station turbines with 3,000 employees in
Germany, France and Britain (formerly Alstom Power
Conversion, now Converteam) sold to a British financial investor.
Since 24th January 2007, there has been an EWC agreement
according to French law which provides two annual meetings for
the nine EWC members in the company based in Massy
near Paris. These choose a steering committee of three, which
can initiate working groups within the EWC, comparable to the
regulations for the German utilities company Stadtwerke Leipzig and to the Italian bank UniCredit (see
report in EWC
News 1/2007).
A
training took place at Paris airport for the members and
substitute members on 22nd and 23rd May 2007 some weeks before
the constituting meeting. On suggestion of the French trade
union CFDT and the European Metalworkers' Federation (EMF) Dr
Werner Altmeyer and Dr Heiner Köhnen of the training and
consultancy network "euro-workscouncil.net" equiped
the delegates with an intercultural and communicative base for the work in the
future EWC.
 Pragmatic
text in specialty chemicals
An
agreement on the formation of an European works council for the
1,900 employees of the U.S. company Cytec in Europe was
signed on 19th June 2007 in Graz (Austria). The wording is – characteristic for many Anglo-Saxon texts –
pragmatic, the management
showed itself quite accommodating at some points. So two
meetings per year take place, in exceptional circumstances an
additional special session is called on application within two
weeks. Not only the twelve EWC members but also further workers'
representatives from locations concerned take part in it.
Three
delegates are sent from Belgium and Austria, two from Germany and
one mandate each goes to Spain, Italy, Netherlands and Norway.
France shall join at the end of 2007, the staff is increased
there at the moment. Between meetings the business is run by
a three-headed steering committee whose members come from
different countries. Furthermore the agreement provides for training, expert support and a method to solve disagreements
outside the court. It is subject to Belgian law.
IT service providers have difficulties with European works councils
Speed is regarded as an entrepreneurial necessity especially in the software industry.
However if the management negotiates about the involvement of its employees in cross-border restructurings, the processes turn out extremely tough. Just before the end of the legal negotiation deadline of three years an EWC agreement was signed for the French IT service provider
Atos Origin in Brussels on 28th
June 2007. Two annual meetings as well as expert support are
scheduled. Based on the French model the EWC is a mixed body to which employers’ and workers' representatives belong.
The
three-year period however was not enough to reach an EWC
agreement in the U.S. software enterprise
Oracle. The
negotiations failed between central management and the
special negotiation body (SNB) in May 2007. Thus Oracle is
besides the engineering group Körber in Hamburg one of the few
cases where an EWC is founded by virtue of law.
An
Italian cement group renews EWC agreement
On 4th July 2007 a revised EWC agreement was signed in Rome for one of the ten largest Italian industrial companies. Italcementi is the fifth biggest cement manufacturer of the world with market leadership in the Mediterranean region and disposes of an EWC since 1995.
The 26 EWC members meet once a year, when required a second plenary session can take place. Eleven mandates are allotted to Italy, eight to France, two each to Belgium, Spain and Bulgaria and one to Greece. Aditionally one representative each of the three Italian
trade union confederations CGIL, CISL and UIL and the European Federation of Building and Woodworkers (EFBWW) takes part in the meetings. The EWC is chaired by an office composed of four members (Belgium, Italy, France, Spain), which meet twice every year. The chairmanship lies with an Italian trade unionist who is nominated jointly by the three confederations from Italy. When required an expert can be consulted, this one however only takes part in the preliminary meetings of the employees’ side but not in the meetings with central management.
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5.
Company agreements on social standards
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Even
three
agreements in a French utility group
Since
August 2006 there have been intensive negotiations at Suez between
central management and the EWC on the international human resources policy. Although
the parties have not reached an agreement in all points yet, three
international framework agreements were signed on 3rd July 2007: about
a financial participation, about an anticipatory personnel development
planning and for the promotion of equal treatment and diversity. For
the first time all group employees worldwide will get a financial
participation.
European
agreement on anticipation of change
On
12th
July 2007 the French group Schneider Electric signed an
agreement on anticipatory and socially compatible design of
strategic company policy with the European Metalworkers' Federation
(EMF). The initiative was taken by the employer in December 2006. The
agreement is valid in the same countries as the EWC agreement and
contains rules for competence development of the employees, for the
early involvement of the European works council prior to cross-border
restructurings and for the procedure in case of job cuts.
 Worldwide
framework agreements on core labour standards
Within
the last months a number of framework agreements were signed again on
the application of social principles and core labour standards in
worldwide active companies. The contracting parties on employees' side
are as a rule international federations of trade unions, in some cases
also the EWC.
Report
on a conference in the metal sector (in German)
On
13th
April 2007 a worldwide framework agreement was signed for the
Dutch group Brunel which has particularly specialized in
project management and staff recruitment for the oil and gas industry.
Compliance with fundamental social standards, a claim to company
based further training and timely consultation of employee
representations in case of restructuring is assured to the 5,300
employees.
On
4th
May 2007 a further worldwide framework agreement was signed on
the edge of the EWC meeting in Barcelona for the 35,000 employees of
the Canadian printery group Quebecor on the compliance with
international core labour standards. Only in November 2006 it almost would
have come to a legal dispute because the EWC was ignored prior to
several transnational restructurings.
The
German WAZ group is taking on a pioneer role. Within
the last few years it has purchased numerous companies in Eastern
Europe and on the Balkans. The framework agreement signed on 4th July 2007 in Essen is worldwide the first one in the media sector. In this
agreement the company commits itself to respect fundamental social
rights at work and to establish a forum where once a year
representatives of all countries meet. The agreement was presented in Brussels
together with EU Commisioner Viviane Reding on 9th July
2007.
Rheinmetall boycotts
monitoring The
German car supplier and armour group Rheinmetall had concluded an
international framework agreement in 2003 and obliges itself to
observe worldwide core labour standards and to provide for equal
opportunities and health protection. The International Metalworkers'
Federation (IMF) organized a meeting of European and South American
workers' representatives in Neckarsulm (Germany) on 12th and 13th June
2007 to
discuss the compliance with the agreement. However, this meeting was
not supported by the employer, which was described by the president of IG
Metall trade union Jürgen Peters as a violation of democratic rules of the game and
even as a breach of the agreement. It was only after the press had
reported that central management offered a delegation
of the European works council to visit Brazilian factories. The EWC
chairman Peter Winter wants to accept the offer, but doesn't
consider it a substitute for worldwide monitoring meetings.
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6.
Negotiated participation in the SE
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 Software
company without employee participation
On
7th
December 2006 the Mensch und Maschine Software AG with
seat in Weßling near Munich was transformed into a European company. The
300 employees in Germany, Austria, Switzerland, France, Italy, UK, Belgium,
Sweden and Poland know neither works councils nor an employee
participation in the supervisory board. The situation reminds a
little of the substantially larger rival company SAP before the
formation of a works council was forced. In
the course of the SE transformation the statutory
consultation of the workforce took place, which however did not
show interest in a participation. The separation into executive
board and supervisory board was lifted in the new legal structure of
the company. There is now only one management board modeled on
British example. The company founder has already announced that he
would transfer the seat of the corporation abroad, if he should be
forced to introduce co-determination in Germany. This also reminds of
statements of the SAP management before the formation of the works
council.
 Reinsurer as a SE pioneer in France
On 14th May 2007, three special negotiation bodies at Scor have come to an agreement to form one joint SE works council for
the three European companies. This is not only the first case of a SE agreement in France but also a completely new legal construction. There are two
companies below Scor holding: one for life insurances and one for other insurance business. A joint SE works council ("Comité Commun des Sociétés Européennes") consisting of 19 members which quarterly meets is to look after employee participation. The employees' side can in addition send two representatives to the administrative board of the holding.
Fresenius concludes an exemplary participation agreement Shortly before expiry of the
statutorily six months period, negotiations about a participation agreement were completed in the medical group Fresenius on 13th July 2007
(see report in EWC News
1/2007 on the beginning of the negotiations). Four workers' directors
from Germany and one each from Austria and Italy will belong to the twelve-headed, equally
composed supervisory board (the trade unions had voiced in favor of 20 members). Among these are four works council members and two full-time trade union officers (one from the German service sector union ver.di and one from the chemical sector union of the Italian confederation CISL). The SE works council consists of 29 members among them seven from Germany and one each for the 22 other countries.
The council elects a chairman, two deputies and another four members who form the select committee.
The SE works council meets only once a year and special meetings are only possible with restrictions,
but the select committee has the right to three meetings per annum,
one thereof can serve to visit a foreign plant, and is informed in extraordinary circumstances on time.
Workers' representatives from countries or locations concerned by concrete measures then can be invited to such meetings in addition. The new SE works council has the power of initiative in
a range of topics: equal opportunities, health and safety at work, data protection as well as training and further education policy. The employer bears seminar costs, pays up to two experts and permits the participation of two representatives of European trade union federations. Possible disputes can be solved fast in an arbitration board.
 Formation of Porsche Automobil Holding SE
The supervisory board of a new Porsche Automobil Holding SE
convened for the constituent meeting in Stuttgart on 24th and 25th July 2007.
Prior to this a participation agreement had been negotiated between central management and the special negotiation body
(SNB). The SNB met for the first time on 10th May 2007, 17 members belonged to it from Germany, France, Spain, UK, Ireland, Italy, Austria and Czechia as well as trade union officers of IG Metall. In the new agreement the competences and the electoral procedure for the future SE works council and the representation of employees in the SE supervisory board are
set. Since
in a German public limited company the number of mandates would
rise with an increasing number of employees and thus more and
more workers' directors would move to the governance body, this
remains unchanged with twelve members in the SE supervisory board.
This question plays a central role in many SE foundations of German
enterprises while the parity representation in the supervisory board
is accepted. The German group works council chairman Uwe Hück
became deputy chairman of the SE supervisory board. The
up to now existing Porsche AG (as a 100% daughter) and the 31% share
in Volkswagen are run under the roof of the new holding. However,
workers' directors of Volkswagen only get a claim on seats in
the new supervisory board, if Porsche increases the VW participation
to more than 50%. As a third column a new lorry group could be
integrated later after the planned MAN and Scania merger.
SE
negotiations at BASF started
After the decision of
the general meeting on 26th April 2007 to change BASF into a SE the
special negotiation body (SNB) constituted itself in Heidelberg on
12th
June 2007. It will conclude a SE participation agreement with central management not later than November 2007. The 29 workers'
representatives from 23 countries elected Robert Oswald, the
chairman of the German group works council, as chairman of the SNB
and engaged a negotiation delegation of twelve representatives from
Belgium, Germany, France, UK, Italy, Poland, and Spain as well as a
representative of the executive staff to do the detail work.
Documentation
of the transformation process
Interview
with the SNB chairman
Presentation:
BASF from an AG to a SE
Report
in the magazine Mitbestimmung about the example of BASF
(in German)
Background:
Scope of negotiations when founding a SE
(in German)
Accompanying
research for the formation of Allianz SE Since
October 2006 the insurance group Allianz operates in the legal form of
an European company. The
participation agreement of Allianz was the first Europe-wide in such a large
company and could become an example for many others. For this
reason the European federation of service sector trade unions (UNI) had
engaged the IMU-Institut in Munich to carry out a scientific
study on the process of the negotiations. Works councils and union representatives in several countries were
questioned. The
results were presented at a workshop in Brussels on 8th and 9th May
2007.
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7. Case
studies: Aluminium and household appliances industry
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Gigantic merger wave at raw material
companies
 The
high metal prices, a result of the increasing demand from China and
the accelerating world economic situation, fuel the take-over wave
in the primary industry. Through the buying up of competitors,
market shares can be increased faster and cheaper than by building new factories. How
do works councils behave in such
situations? Do they remain passive spectators or do they interfere on
the event?
Alcoa
and Alcan were world market leaders in the aluminium industry for years
but since the merger of two Russian groups recently they are not any
longer. Therefore the U.S. company Alcoa tried in spring 2007 to take
over the Canadian competitor Alcan hostilely and to reconquer the
world's top position. When these take over plans were disclosed the EWC of
Alcan voiced against the merger at its meeting in Paris on 29th and 30th May 2007. Such mega-mergers
would not only be a danger for the staff of the
taken company but also for those of the buyer. The EWC fears that the
European aluminium industry will lose more and more competence centres and
research sites by doing so.
On
1st
June 2007, workers' representatives of Alcan and Alcoa met in
Brussels on invitation of the European Metalworkers' Federation (EMF) to
discuss the effects of such a merger on the jobs: the German EWC chairman
of Alcoa, the French EWC secretary (spokesman of the employees' side) of
Alcan as well as two trade union officers, which assist the European works
councils on behalf
of the EMF. After the first conversation in the small circle further EWC
members of both groups from seven countries came together in Brussels on
21st
June 2007 and agreed on a common procedure. They demanded the strict
compliance with their participation rights, the involvement in the process of
EU merger control and the immediate convening of a common special meeting
with central management of both groups.
"White
knight" prevents a hostile take-over
A
special EWC session actually took place in Zurich on 25th July 2007, but
only for the EWC of Alcan. The CEO had arrived from Canada personally to
inform the workers' representatives in Europe about the merger with Rio
Tinto. The British Australian raw material group based in London had stood
in on 12th July 2007 as a "white knight" to prevent the hostile
take-over by Alcoa. The deal will have the same dimension as the take-over
of Arcelor by Mittal Steel in June 2006.
The
central management of Rio Tinto will explain to the EWC of Alcan its plans
more exactly in the middle of September 2007. The sale of the packaging
division of Alcan, which amounts to 23 per cent of the group’s turnover is
particularly scheduled. The EWC demanded a financial expert report to
be able to assess the effects on the jobs more exactly. For French shaped
European works councils such extensive advisory services are at the
agenda - differently from British or German companies. Great anxiety
triggered the merger in Switzerland (texts available only in German):
Alcan
emerged from numerous take-overs, particularly the Swiss
Alusuisse-Lonza and the French Pechiney group, and additionally disposes
of important production sites in Germany and the UK. Already since
1996 there were European works councils in these companies. After completion of the mergers a new EWC agreement was
signed according to
French law in March 2006.
Rio Tinto
does not have any EWC yet since large parts of the sites are located outside
Europe. In Australia the company is confronted with heavy criticism of
trade unions and environmental groups because of violations of employee
rights and safety regulations. It remains to be seen how this anti trade
union attitude will become apparent in the European locations of Alcan. The
EWC of Alcan will probably represent the European employees of Rio Tinto in
future.
The
hunter could now become the chased himself The
take-over of Alcan by Rio Tinto - Deutsche Bank served as an adviser
in the background - will fundamentally change the company landscape of
the raw material industry. In stock exchange circles is speculated, the
inferior bidder Alcoa could himself become a target of a hostile take-over,
possibly by ArcelorMittal (see report further
above). Alcoa has an
EWC according to Dutch law since 2001 and is strongly represented in
Spain, Italy and Hungary.
 Restructurings
in the household appliances industry
From 27th to
29th
June 2007 representative of trade unions,
enterprises and
science from the new and old EU countries met in Arezzo (Italy) to discuss
alternatives to current restructuring in the household appliances
industry. A survey done by the
Istituto per il Lavoro (IpL) in Bologna shows the dramatic extent of the shift
to low wage countries and the loss of jobs. The shutdown of the AEG
plant at Nuremberg had caused special
attention in Germany. Measured in terms of employee numbers this
industry still takes the second place in Italy, Spain and some Central
European countries after the car industry.
Originally
the "white goods" were mainly produced in Germany, Sweden and
Italy. But already in the middle of the eighties a shift took place to
Southern Europe. While small equipment like iron, coffee machines or
vacuum cleaner is almost only produced today in Southeast Asia, the
production of the large equipment (washing machines and dishwashers, dryers,
ovens) drifted towards Middle and Eastern Europe including Russia and
Turkey where the market steadily grows and the wages are still low.
How shall trade unions and European works councils behave at such
restructurings?
At
the conference different approaches were discussed using case studies and
the challenges also assessed for the new EU countries. Already some product
lines shall be shifted from Eastern Europe to China. Which role did the
European works councils of Electrolux, Whirlpool, BSH
and Indesit play in the retrograde production shifts? In all these
cases a considerable lack of a cross-border coordination was noticed. How employee representatives behaved locally?
About this also two case studies existed: the enterprises Arctic from Romania and De' Longhi from
Italy. At the end of the meeting Prof Bierbaum of INFO-Institut in
Saarbrücken (Germany) introduced a suggestion for better coordination of EWC
work in this industry. All meeting presentations and documents are
available in the Internet on a special website.
Further
industry-specific reports in earlier editions of EWC News
(most in German):
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8.
Turkey: a topic for the EWC?
|
 On
3rd
October 2005 the accession negotiations started between
Turkey and the EU. Already since 1963 the country is associated with
the European economic community, the precursor of the EU, and joined
in 1996 as the only not EU country the customs union. Since 2002
Turkey experiences a small economic miracle with growth rates of six
per cent annual and record influxes of foreign investments. Till now,
1,500 German enterprises have established themselves, of this a third
from the metal industry. The most important export industry is the
textile and clothing industry, followed by motorcar suppliers and home
appliances. A third of all TV sets sold in the EU are from Turkey.
With 73 m. inhabitants it would be the second largest member state
after Germany, its most important trading partner, when joining the EU.
From the 20 m.
employees only about 14% are members of a trade union (what
corresponds to the standard of Spain), the majority in the
confederation Türk-Is. The legislator has set the trade unions high
hurdles: they can conduct collective bargaining only if they represent more
than 50% of the employees of a company whereas every single membership
must be verified notarially. The majority of the employees in Turkey
therefore is not covered by collective agreements. The working week is
generally 45 hours. There are no works councils, however, the set-up of a
site union representation is possible by
recognition agreement like in the UK. Turkey ratified the social
charter of the Council of Europe in September 2006, what is regarded
as an important signal in the context of EU accession negotiations.
According
to calculations of the European Trade Union Institute any eighth
company falling under the scope of the EWC Directive had a
branch office in Turkey in 2006 (in total 270 companies). If Turkey would
already be member of the EU today, Turkish delegates could
move in into 152 already existing European works councils. At present,
five delegates and three observers from Turkey are involved on a
voluntary basis in some few councils.
On 24th and 25th April
2007 the European Metalworkers' Federation (EMF) carried out a meeting
in Istanbul "Social Dialog and Corporate Social Responsibility in
South-East Europe" which was thought also in response to numerous
cases of hindrance of trade union activities in Turkey. According to
the EMF Turkish labour law does not comply yet with internatinally
valid rules, which apply everywhere in the EU. 600 participants of a
Labour Day demonstration were arrested in Istanbul few days later on
1st May
2007.
 For
further reading (in German):
The DGB Bildungswerk
together with IG Metall published in 2005 a booklet worth reading on
the history, the economy and the social system of Turkey as well as on
the current problems of the Turkish society with regard joining to the
EU.
DGB-Bildungswerk/IG
Metall:
Länderprofil:
Türkei
Tradition
und Wandel
Düsseldorf/Frankfurt
am Main 2005, 52 pages, € 3,50
The euro zone will
be enlarged
 Another
two countries may introduce the euro as a means of payment on 1st January
2008: Malta and South Cyprus. The EU Council of Ministers decided
on it under the presidency of the German Chancellor of the Exchequer
Peer Steinbrück on 10th July 2007. The Maltese lira and the Cyprian
pound will then be converted at a fixed rate in euro coins and banknotes. The former Yugoslavian republic Slovenia
had introduced the euro already at the beginning of 2007 as the first
of the EU accession states.
In future the euro zone
will thus cover 15 of the 27 EU member states with about 320 m.
inhabitants. But already in 2009 Slovakia could join, in 2011 the
three Baltic states and Bulgaria. In contrast, the economically
most important countries in Middle and Eastern Europe (Poland, Hungary
and Czechia) will satisfy the criteria for the monetary union at the
earliest in 2012, Romania only 2014.
Previous focuses on
countries in EWC News (mostly in German):
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 Management
and EWC, a relationship full of contradictions?
Since
January 2006 a research project about European works councils in
Austria has been conducted by the Institute for Society and Social Policy at University of Linz. EWC
members, trade union officers and representatives of the management
have been questioned in twelve groups. The Linz researchers have
identified several models similar to those of the German study of
Prof. Kotthoff. They examined the role
of central management and ordered it into types. We continue today to
present selected results.
Type 2: The EWC as a presentation forum for policy of the
group
At the type 2 no well-adjusted cooperation could evolve between
management and the EWC for long time, the relations have remained
contrary. Central management informs the EWC selectively and
little transparently. The EWC meetings are obviously dominated by the
papers of the management: abstract charts and financial business data
show the performance of the enterprise. These partly very effortful
presentations belong to the professional routine of the top managers,
serve the image advertising and are constituent of the "marketing
strategy of the group".
Provided
that restructurings are justified and explained at all, this shall
increase the understanding of the delegates and defuse the risk of
cost-intensive industrial disputes. Comments of EWC members are
desired as long as they do not contradict the management's position. Neither a critical dialogue
is developing nor compromises on
human resource issues are possible.
The core problem of the EWC of type 2 is that the orientation at the
shareholder value principle does not open any scope for participation of
employee representatives. Monetary and
quantitative targets form the basis of corporate control, the
management exclusively decides on aims and strategies on the basis of
the owners’ interests. European works councils of the type 2 can be
found frequently in Anglo-Saxon enterprises and in a weaker form also
in individual continental European groups.
The further types are:
 Analysis
of the conduct of negotiations in the EWC
„Intercultural
competence and robust transnational solidarity rise in times of the
globalisation to strategic key resources of trade union representation.“
This core statement
is from a research outline of the institute for sociology of
University of Erlangen Nuremberg which draws one's attention to a
delicate "internationalization deficit" of the employees'
side compared to the management. Under the title "communication
and solidarity in cross culture employee cooperation" surveys
have started in several multinational enterprises at the
beginning of 2007.
The project assistants Matthias Klemm and Dr Jan Weyand
are particularly interested in which
concrete conditions an intercultural communication becomes successful in
the EWC. Besides expert interviews - one took place under
participation of Werner Altmeyer, training and consultancy network
"euro-workscouncil.net", in Erlangen on 14th April 2007, -
proceedings in interculturally composed works council meetings are recorded and analysed.
Previously, the project team "cross
cultural solidarity" had already carried out German Czech
comparable studies on communication in multinational enterprises. The
following texts are available only in German:
EWC
research in the motor industry
A
research project on European works councils in the motor industry started at the Ruhr
University of Bochum on 1st March 2007. The
team around Prof Dr Ludger Pries would like to develop an EWC
typology, to examine structural conditions of its work and to analyse results of negotiations between EWC and management. The empirical
study will cover production sites in Germany, France, UK, Spain and
Poland of the following groups: DaimlerChrysler, Volkswagen, General
Motors, Ford, Renault and PSA Peugeot Citroën.
As
part of this research project a workshop took place in Bochum
with scientists from six countries from 9th to 14th July 2007 to
examine different aspects of EWC research. Particularly
interesting were the country studies on European works councils which
were introduced by speakers from Poland, UK, France and Spain. In his
contribution Dr Werner Altmeyer from the training and consultancy
network "euro-workscouncil.net" followed the question
whether European works councils would need codetermination rights or
preferably negotiation rights.
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10.
Interesting web pages
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Employee
participation in Europe

This new topic page
of the European Trade Union Institute provides background
information about numerous aspects of employee participation:
European works councils, participation in the European company,
information and consultation at a national company level, EU
legislation, social dialog at European level and special features
of industrial relations in each of the 27 EU member countries.
Particular aspects, e.g. collective bargaining systems, health and
safety or participation rights, can be compared "at the touch
of a button" between the countries.
British
mega-trade union merger
The United Kingdom
has a new trade union since May 1st, 2007: Unite with two million
members has resulted from the merger of two multi-sector
unions – Amicus which is strongly represented in numerous
sectors among others in the metal industry (see Amicus
sectors), and the transport workers’ union T&G
which is already grown beyond this sector (see T&G
sectors). Unite wants to concentrate on the recruitment of
younger employees (10% of the complete budget is provided for
this) and the international cooperation.
 Unite
is not only the largest British trade union but also leading in manufacturing, in the transport sector, banks and
insurances, in the food and in the printing industry. It has
also a strong membership base in the building and construction
industry and in some services sectors, e.g. the cleaning and
security trade. In the private sector there is only one other
individual union with GMB, which is besides Unite numerical
of importance. The merger shall be completed until November 2008,
after that mergers are planned at an international level: with the
steelworkers union of the USA and Canada (USW).
 Foreign
posting made easy
Eurocadres,
the
Council of European professional and managerial staff has published a manual for
deployment abroad on the Internet.
It is aimed at all employees who work in another member country of
the EU or want to return from there. For every EU country
information can be retrieved about the residence and contract of
employment right, the recognition of professional qualifications
and diplomata, the national insurance system, the taxation, trade
unions and working conditions up to tips for the search of a flat
and looking for work.
Italian EWC
portal
 With
financial help of the EU the Italian trade union confederation
UIL has put an own site for European works councils
(Italian: Comitati aziendali europei - Cae) into the net. Besides
EWC information other topics like the EU Directive on information and
consultation, the European company and transnational collective
bargaining could also be found there.
We
have compiled numerous further interesting links in a link
collection.
|
 Which
identity does a European works council have?
This
English-speaking anthology, which deals with the question about
the collective identity of European works councils has been
published in May 2007. Authors from several EU countries examine
different aspects of the current EWC research. How do employee representatives perform their work as an EWC member with a
different cultural background?
Michael
Whittall/Herman Knudsen/Fred Huijgen (eds.)
Towards
a European Labour Identity
The
case of the European Work Council
London/New
York 2007, 233 pages, ISBN 978-0-415-40396-2, €
77,99
→
Further
information
→ Online
order
 Basic
knowledge concerning EU topics
This
exercise book deals with the political system of the EU (bodies,
competences), the economic integration (single market, euro
zone, Europeanization of the economic policy) and its social
consequences (pay, social systems, taxes, migration, company
relocations). A special attention is put on the problems of the
Eastern enlargement and the prospects of the European social
model. The book is suitable as a reference book as well as for
adult education. It emerged in the context of the project
"work and prosperity in an enlarged Europe". The training and consultancy
network "euro-workscouncil.net" added some texts
on European works councils. The book is available only in
German.
Alexandra
Baum-Ceisig/Klaus Busch/Claudia Nospickel
Die Europäische Union
Eine Einführung in die politischen, ökonomischen und
sozialen Probleme des erweiterten Europa
Baden-Baden
2007, 371 pages, ISBN 978-3-8329-2138-5, € 14,90
→
Table of
contents
→ Online
order
 Facilitation
of cross-border meetings
A
book for the German French cooperation has been
released in May 2007, which provides valuable suggestions
including for European works
councils. The authors do not only give practical tips how meetings
or project teams can be facilitated with French, Luxembourg, Swiss
and German participants - but moreover, deliver also
scientifically sound instructions to the intercultural
understanding. Using many case studies they show dangers, which
can lead to misunderstandings,
disturbances and possibly even to failure of
intercultural projects. The intercultural
guide is a kind of "toolbox" and was composed by
experts of the intercultural cooperation from the German French Euro-Institut
in Kehl. The book is available only in German.
Euro-Institut,
Institut für grenzüberschreitende Zusammenarbeit (ed.)
Interkultureller
Leitfaden
zur
Moderation grenzüberschreitender Sitzungen
Baden-Baden 2007,
108 pages, ISBN 978-3-8329-2477-5, € 19,-
→
Further
information
→ Online
order
 Labour
law manual with an European part
The
new edition of this manual does not only represent
comprehensively material labour law and labour court procedures
in Germany from the employee view but contains one section each
of the international labour law and of the European community
law. Here basic knowledge can be refered to (hierarchy of norms,
transposition of Directives etc.), however information about
all important Directives concerning labour law is also part of
it. A
chapter deals separately with the collective European labour law
and among other things with the European works council and the
SE works council. The book is available only in German.
Michael
Kittner/Bertram Zwanziger (editors)
Arbeitsrecht
Handbuch
für die Praxis mit CD-ROM
Frankfurt
am Main 2007, 4. edition, 2.993
pages, ISBN 978-3-7673-3773-3, € 189,-
→ Online
order
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12.
Training and Consultancy Network "euro-workscouncil.net":
further examples of our work |
New
faces in EWC advice and research
The
growing demand for the offers of the training and consultancy
network "euro-workscouncil.net" required
reinforcements of our team. Two new members have joined in
spring 2007, both very familiar since years with international
trade union activities and industrial relations.
 After
studies at the London School of Economics and Political Science
(LSE), a PhD thesis on trade unions in the UK and teaching at
the University of Hamburg Dr Carmen Bauer (photo) worked
at the national office of the German postal workers union. She
then became the personal assistant of the president of the German
Industrial Union of Construction-Agriculture-Environment (IG
BAU) Klaus Wiesehügel and later political secretary with
the Brussels based European Federation of Building and
Woodworkers (EFBWW). She is now in charge of the
practice of European works councils, configuration of EWC
agreements and European health and safety at work within the network
"euro-workscouncil.net".
 Bernhard
Stelzl (photo) is just about to complete his PhD thesis on
social standards of German enterprises in Brazil. Since 1992 he
is working as a trainer in international seminars, as project
manager and freelance journalist. His main emphasis of work is on the
cross-border cooperation of workers' representatives,
international company codes of conduct on working and social
standards as well as communication and conflict training. He
will strengthen both the publication and also the research
activity within the training and consultancy network "euro-workscouncil.net".
 Active
EWC work in an Austrian steel group
Voest-Alpine
has a similar past like Volkswagen: founded at the Nazi time the
state-owned enterprise was after the war noted as a focus of
trade union movement and for outstanding company benefits. Today
Voest-Alpine
with its parent plant in Linz at the Danube (photo) is a highly profitable,
quoted manufacturing company with an own steel
base – and an exemplary EWC agreement. The workers'
representatives from the four areas steel, railway systems,
automotive,
and profiled forms carry out cross-border division meetings with
the respective division management. Such regulations exist only in few
enterprises e.g. in the aviation and aerospace group EADS and in the Swedish
packaging
group SCA.
The
training and consultancy network
"euro-workscouncil.net" organized a workshop for the
European works council in Linz on 16th April 2007. In working
groups it was for example acquired how one can
better anchor the EWC in the workforce, use the secretariat as an information
turntable or develop the EWC further to a transnational
negotiating party. The following texts are available only in German:
IG
Metall pushes EWC formations at the lower Rhine region
There
is still a considerable backlog demand for the setting-up of
European works councils in the metal and textile industry as
well as in wood-processing. To push this process in smaller and
medium companies which are seated at the lower Rhine, a
meeting took place in Krefeld on 30th April 2007, which was
co-organized by the training and consultancy network
"euro-workscouncil.net". The initiative started out
from IG Metall trade union which is responsible for these sectors in Germany.
 Workshop
for the EWC formation at the Black Sea
Some
25 workplace representatives and full-time trade union officers
of the transport sector from six countries met from 5th to 8th May
2007 in the Romanian seaport Constanţa to inform themselves
about means and limits of European works councils.
The workshop took place in the context of a project sponsored by
EU funds with the support of the European Transportworkers'
Federation (ETF). Speakers of the event were besides Werner
Altmeyer of the training and consultancy network
"euro-workscouncil.net", Philippe Alfonso of the ETF
in Brussels and Erika Young, a deputy chairwoman of the
International Transportworkers' Federation (ITF) in London. The
port of Constanţa is regarded as "Rotterdam of the
East" because of its strategic situation at the
Rhine-Main-Danube route and the considerable volume handling.
Restructurings
in the chemical industry
 On
3rd
July 2007 Dr Werner Altmeyer and Bernhard Stelzl from the
training and consultancy network
"euro-workscouncil.net" took part in a conference in
Rome to report about the rights of the German works councils at
restructurings. The meeting is part of an EU sponsored project
on the implementation of the Directive on information and
consultation which is managed by the research institute Cesos and the trade union confederation
CISL from Italy. Within the next
months empirical results are collected in some enterprises of
the chemical industry. Cesos has already published case
studies from France, Hungary, Italy, Spain and Romania - also
from other sectors - on its web page.
Our
publication activities
In
April 2007 Bernhard Stelzl dealt with the topic "taking on responsibility
- Corporate Social Responsibility in Germany" in an article
for the Personalmagazin. In May 2007 Werner
Altmeyer and Lionel Fulton presented in the magazine der
betriebsrat the current situation of workplace
representation in Britain. And Reingard Zimmer examined Europe-wide
antidiscrimination agreements in the magazine Arbeitsrecht
im Betrieb in July 2007.
With technical support of the training and
consultancy network "euro-workscouncil.net" the paper Frankfurter
Allgemeine Zeitung published a report on current trends of EWC
activities particularly at restructurings on
21st July 2007.
The report is available only in German.
You
find additional publications at our publications
page.
 ver.di/GPA
newsletter: new edition
On 4th June 2007 the third issue
of the EWC newsletter, jointly published by the unions ver.di in
Germany and GPA in Austria, was released. The contents are
co-designed by the training and consultancy network "euro-workscouncil.net".
Topics of the issue
1/2007 were the new EWC agreement at UniCredit with an interview
of the chairman of the German group works council of HypoVereinsbank, Peter König, a report on the
establishment of
European works councils in the finance sector, European works
councils in tourism (particularly the situation at
Thomas Cook after the merger with MyTravel), the Europe-wide
EWC-networking in media companies, accents in the energy sector
and a report of the meeting of the services sector trade
unions (UNI) in Athens. The newsletter is available only in
German.
Courier,
parcel and express services: Study on EWC formation
 At
present, the training and consultancy network
"euro-workscouncil.net" is working on an analysis of EWC
agreements in the area of the courier, parcel and express
services. The study is financially promoted by the European
Commission and serves to support the EWC formation in this
sector, e.g. at GeoPost. The study is to be published in autumn 2007 and deals particularly
with the companies DHL (Deutsche Post), FedEx, Securicor, TNT, UPS
and Wincanton.
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13.
Details of seminars planned
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Registration
for the following seminars and workshops that we have
co-designed can now be made:
Europe
for trade union officers of IG Metall
Institutions,
political fields, European works councils
08
-- 10-10-2007 in Bad Orb
Works
council activities in Europe, the European works council (EWC)
Legal
basis, foundation, intercultural communication
04
-- 09-11-2007 in Hamburg → Further
details about this seminar (in German)
Formation
of European works councils in the port sector
18
-- 24-11-2007 in Livorno (Italy)
→ Further
details about this workshop
In-house
events
Please
find a survey of the subjects for in-house events here:
→ Subjects
of In-house seminars
→ Subjects
for in-house lectures
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EWC
News is published by:
Training
and consultancy network "euro-betriebsrat.de" GbR
Authors
collaborating on this issue:
Werner
Altmeyer, Carmen Bauer, Kathleen Kollewe, Bernhard Stelzl, Reingard Zimmer
Distributor
of the German version: 8,589 Empfänger
Newsletter
archive: www.ewc-news.com
We are always pleased to receive comments and suggestions in relation to this newsletter as well as reports on your EWC activities.
Please write us at: info@euro-workscouncil.net
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