Management, European Works Councils and institutional malleability

Abstract

We show that most managers responsible for European Works Councils do not comply with the information and consultation requirements stipulated in legislation, and cite stock market regulations as the principal reason for non-compliance. Compared to employee representatives, managers also downplay the importance of articulation between European Works Councils and national institutions of labour representation, using them to achieve managerial objectives. We thus illustrate the ‘malleability’ of European Works Councils and argue that further regulatory intervention is required if they are to function as information and consultation institutions as originally intended by EU policy makers.

When are European Works Councils informed and consulted, and how do they gain influence? A quantitative analysis

“…When management wants to engage with the EWC, the EWC will be more effective. This is in line with many other studies that identify the important role of management in the functioning of the EWC (Kotthoff, 2006; Stöger, 2011; Weiler, 2004), but also the associated risk that management might (ab)use the EWC for its own interests rather than as a genuine workers' body (Hume‐Rothery, 2004; Lamers, 1998; Pulignano & Turk, 2016; Pulignano & Waddington, 2020). The importance of the management factor demonstrated here opens the question as to how companies can be spurred to send the real decision‐makers to EWC meetings and how to make them more interested in trying to find common ground, discussed further below.…”

“…This refers to how managers regard the EWC and whether they adopt a rather minimalist approach (simply to comply with the legislation) or a more voluntarist one based on trying to involve the EWC in decision‐making and find agreed solutions and, in this way, increasing the acceptance of management decisions by staff. More recent studies, including by Pulignano and Waddington (2020), confirm the power of managers in shaping what EWCs can achieve and whether they allow them actually to influence management decisions. The second set of agency‐related factors refers to employee‐side organisation and the degree to which EWC representatives from different countries are a cohesive group of people that interact frequently, trust each other and try to come to common positions. Lastly, researchers see the nature of the EWC's interaction with management as an important factor, referring to how the management and the EWC deal with each other in practice, that is, the degree to which their exchanges are characterised by hostility or a more open, co‐operative dialogue. Based on this framework, the researchers developed a comparative analysis of eight EWCs from which they identify three main thresholds that must be met by the company and the EWC before there can be an impact on decision‐making. These thresholds combine the structural and the agency factors.…”

Transnational employee voice and knowledge exchange in the multinational corporation: The European Company (SE) experience

“…Therefore, we acknowledge that the SE entails a degree of ‘specialness’, in which both its regulatory framework and frequent historical origins in German employee voice institutions accrue advantages. Numerous studies of MNCs report management under-utilization of voice structures, withholding of information and obstruction (Pulignano and Waddington, 2019; Whittall et al, 2008). Yet our data, reporting predominantly favourable, pro-employee involvement and participation – including transnational composition of boards – and shared interest recognition from managers as well as labour actors, runs against the tide.…”

“…Some EWCs are effective in achieving transnational employee participation with influence in company decisions (Hann et al, 2017; Hertwig et al, 2011; Waddington, 2010). More generally, researchers conclude that erratic and disappointing development shows EWCs remain a contested institution with many being utilized predominantly to employer advantage (Pulignano and Waddington, 2019).…”

“…Much debate on transnational employee voice arrangements occurring in company operations raises concerns in regard to company power to circumvent or weakly adopt employee voice practices and deflect trade union demands (Baccaro and Howell, 2017; Keller and Rosenbohm, 2019; Pulignano and Waddington, 2019). We share those concerns.…”