Employees

In the Netherlands, employees can exercise influence on the company where they work with their right of participation. Companies with more than 50 employees are obliged to set up a works council (OR). For smaller companies, they must set up a personnel representative body (PVT) if the majority of the employees request so. A company with fewer than 10 employees does not, in principle, have to arrange employee participation formally, but it is allowed.

Insight into the workspace through employee participation bodies

An employee participation body can bring benefits. For example, as an entrepreneur you will have insight into existing problems because you have regular consultations with the employee participation body. Furthermore, you can make use of the ideas of your employees and you can take these ideas into account in your decision making. Employee participation also ensures greater involvement with your employees and gives the decisions you make as an entrepreneur more support.

Works Council (OR) mandatory from 50 employees

According to the Works Councils Act (Wet op de ondernemingsraden, WOR), a Works Council must be established in companies employing at least 50 people. This is the institutional limit. If there is no enthusiasm among the staff for a Works Council, then the entrepreneur must sound this out again with some regularity. The entrepreneur has a duty of effort here. If an entrepreneur has two or more enterprises with at least 50 persons together, a joint works council must be set up if this is conducive to the proper application of the WOR in the enterprises concerned. An umbrella works council may also be set up. This is the case for affiliated or cooperating enterprises.

Works council regulations

The WOR contains various procedural regulations that the entrepreneur must obey. The underlying reason for this law is the proper functioning of the company in all its objectives.

The Works Council must be well informed by the entrepreneur about what is going on within the enterprise. When the Works Council takes office, the entrepreneur must therefore provide adequate information about the environment in which the Works Council will operate.

Works council’s right to advice

This also includes the right of a Works Council to give advice. A Works Council must be given the opportunity to give advice on certain proposed decisions of the organization. This is known as the right to advice (Section 25 of the WOR). Section 25 of the WOR states when the entrepreneur must seek advice from the Works Council. These include the decision to hire workers or to terminate the activities of the company or the transfer of shares of the organization concerned.

Works Council’s right of consent

In addition, the Works Council has a statutory right of consent (art. 27 WOR). Article 27 WOR states when the entrepreneur must obtain consent from the Works Council. This is an exhaustive list. It always concerns subjects that concern the social policy of the company. The article refers to ‘regulations’. This means that consent is only required in the case of a decision of general application and therefore not in the case of incidental situations.

Regulations with respect to primary employment conditions fall outside the scope of the right of consent (HR 11 February 2000, JAR 2000/86). Article 27 WOR therefore focuses on secondary and tertiary employment conditions, such as a company car, leave and training.

Staff Representation

Employee participation is also important in companies with fewer than 50 employees. A company with more than 10 but fewer than 50 persons does not need to set up a works council. Nevertheless, the entrepreneur must immediately consult and provide information to the staff. In addition, advice must be sought on important decisions. This can take the form of a personnel representative body (PVT). If half of the personnel wants a PVT, you as an entrepreneur are even obliged to set up a PVT. If the entrepreneur does not institute a PVT and half (or more than half) does not request a PVT, then the entrepreneur is in any case obliged to convene the personnel twice a year. The same applies when making an important decision that affects a quarter of the staff.

Advice on employee participation

The entrepreneur or works council sometimes has to request or give consent on short notice regarding complex decisions with important consequences for employees. These are usually matters that require a quick and professional solution.

Our Employment Law Department has the necessary legal expertise in this area and regularly advises and litigates on employee participation issues, such as:

• social plans;
• mergers and reorganizations;
• privacy;
• introduction of home working and corona policies;
• assessment systems and remuneration schemes;
• change in working conditions (think PSA policy);
• change in retirement;
• establishment and organization of employee participation bodies.

Mediation between entrepreneur and works council

Sometimes legally complex employee participation issues can result in a conflict. Some of our experienced attorneys can properly assess the interests of the director and the works council from both perspectives and mediate towards an appropriate and smooth solution.

Lawyers employee participation

Do you have questions about employee participation? The Labor Law department will be happy to assist you. Please contact Peter Verheijden, Lisa Kloot or Richard Ouwerling.

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