This article examines the Irish situation, as of September 2003, with regard to works councils and similar workplace employee representation and participation structures. It looks at the regulatory framework, statistical data, evidence on practice and the views of the social partners.
The issue of works councils and similar workplace employee representation and participation structures is topical at present, with the EU Member States required to implement the recent Directive (2002/14/EC) establishing a general framework for informing and consulting employees in the European Community (EU0204207F) by March 2005 (though countries which currently have no 'general, permanent and statutory' system of information and consultation or employee representation may phase in the Directive's application to smaller firms up until 2008). The Directive applies to undertakings with at least 50 employees or establishments with at least 20 employees (the choice is left to the Member States). It provides employees with the following rights to information and consultation:
- information on the recent and probable development of the undertaking's or the establishment's activities and economic situation;
- information and consultation on the situation, structure and probable development of employment within the undertaking and on any anticipatory measures envisaged, in particular where there is a threat to employment; and
- information and consultation, with a view to reaching an agreement, on decisions likely to lead to substantial changes in work organisation or in contractual relations.
Information and consultation arrangements set out in agreements between management and labour, including at undertaking or establishment level, may differ from those laid down in the Directive.
While the Directive does not stipulate that information and consultation must be provided through any particular channel or structure, it defines such information and consultation as taking place between the employer and the employee representatives provided for by national laws and/or practices. It is these representatives, who in most EU Member States sit on standing 'works council'-type structures (and in many countries already enjoy all or most of the information and consultation rights laid down in the Directive) that are the focus of this article. The existence of workplace employee representation and participation structures, based on law or widespread collective agreements, is seen in some quarters as a distinctive and important feature of the (mainland) European industrial relations model. Indeed, the idea has been raised of using the coverage of such worker involvement arrangements as an indicator of 'quality' in industrial relations (as suggested, for example, by the European Commission’s June 2001 Communication on Employment and social policies: a framework for investing in quality).
In this context, in September 2003, the EIRO national centres in each EU Member State (plus Norway), were asked, in response to a questionnaire, to provide information about the current situation with regard to national (rather than European level) works councils and similar bodies - the regulatory framework, statistical data (or estimates where not available), evidence on practice and the views of the social partners. The Irish responses are set out below (along with the questions asked).
Regulation
What is the legislative framework in your country concerning works councils and/or other workplace employee representation and participation structures? Please include here: definition; workforce-size threshold for establishment; composition/election; subjects for information, consultation and co-determination; conditions under which information, consultation and co-determination should take place (ie timing, methods, contents, level of representation, type of response by employees, form of interaction etc); meetings; confidentiality; protection of employees’ representatives. If there is no legislation on this issue in your country, please refer to widespread systems of works councils etc based on collective agreements.
Ireland has no system of statutory works councils. Trade unions are the primary channel of workplace representation, and the establishment of works council-type structures on a voluntary or collectively-agreed basis does not appear to be a very common practice. However, there is legislation providing for consultation of employees and/or their representatives over certain issues. Notably, statutory requirements for consultation in respect of collective redundancies and transfers of undertakings have been introduced in response to the relevant EU Directives (now, following amendments, Directives 98/59/EC and 2001/23/EC respectively). The legislation originally provided for this consultation to occur in these circumstances through the channel of trade unions. However, new regulations introduced in 2001 (IE0102230N) added a procedure through which employees in non-union firms can be formally consulted. The regulations state that in the absence of a union or staff association, 'a person or persons chosen (under an arrangement put in place by the employer) by such employees from among their number to represent them in negotiations with the employer' may act as employees' representatives.
The Transnational Information and Consultation of Employees Act 1996 was introduced to implement the EU European Works Councils Directive (94/45/EC). It regulates the information and consultation of employees on transnational matters in multinational companies, primarily through a transnational works council-type structure.
There is a statutory system of employee participation and representation in a number of commercial semi-state companies, introduced by the Worker Participation (State Enterprise) Acts of 1977 and 1988. The 1977 Act provided for the appointment of 'worker directors' on the boards of seven of the largest state-controlled companies (TN9809201S), which had grown to an estimated 19 by 1994, although some of these companies have since been privatised. In these companies, employee representatives have one-third of the seats on the (single-tier) boards of directors. The board representatives are directly elected by the workforce and must be company employees. In practice, the majority of worker director representatives are also trade unionists.
Of more direct relevance to works council-type representation is the 1988 Worker Participation (State Enterprise) Act, which provided for the introduction of arrangements for 'sub-board' employee participation structures in 35 state sector enterprises, which could include works council-type bodies.
Statistics
Please provide the most recent available statistics (in absence of statistics please provide estimates referring to sources) on the following (referring to other workplace employee representation and participation structures where works councils are not present and to widespread collective agreements on the issue where there is no legislation):
- the total number of employees and undertakings/establishments in your country;
The latest data from the Central Statistics Office (CSO) indicate that there were 1,778,300 people in employment as of May 2003. No figures are available on the number of undertakings.
- the total number of undertakings/establishments covered by the works councils legislation in your country and their total employment (data should be as much as possible disaggregated by gender, company size and sector);
As mentioned above, there is no legislation on works councils in Ireland. The semi-state sector organisations covered by the Worker Participation (State Enterprise) Acts of 1977 and 1988 employ under 10% of Irish employees. There are approximately 60 worker directors in total across the commercial semi-state sector. With regard to the EWCs Directive and its implementing legislation, approximately 550 operations in Ireland (belonging to multinationals based in Ireland and elsewhere) are thought to be covered.
- the total number of undertakings/establishments in your country which have established works councils and their total employment (data should be as much as possible disaggregated by gender, company size and sector).
Please provide any other national data indicating the number/diffusion of works councils.
As stated above, workplace employee representation and participation structures in Ireland are (outside the semi-state sector) solely voluntary or based on agreement. There are no official statistics on the extent of such structures. The most recent reliable and convincing evidence on this issue is provided by 1999 research ('Collaborative production and the Irish boom: Work organisation, partnership and direct participation in Irish workplaces', WK Roche and JF Geary, Economic and Social Review, 51(1), 1999) based on the findings of a 1996/7 University College Dublin national workplace survey on 'Irish management practice in the changing marketplace'. Of the workplaces surveyed claiming to have in place various forms of employee participation, 12.7% had joint consultative committees/works councils (compared with 71.1% for total quality management, 59% for teamwork, 15% for quality circles and 45.5% for ad hoc task forces). It seems clear that relatively few employers have works council-type structures in place.
Question 3 - Practice
If there are any other statistical sources or recent research on the current practice of works councils or other workplace representation/participation bodies, please give details of the results paying attention to the issues covered by Question 1 (Regulation). Please provide as much quantitative data as possible - eg how many meetings and how often, chair, agenda, composition (eg how many representatives of management, if any, workers, proportion of women members, proportion of women as head of works councils etc) and identify factors of success. Please indicate how the works councils (or works council-type bodies) institution has evolved over the years.
A team of academics from National University of Ireland Galway (NUG), led by Tony Dundon, have recently been conducting research for the 'Department of Enterprise, Trade and Employment', gauging the extent to which 15 Irish enterprises from different sectors of economic activity are prepared for, and capable of adapting to, the requirements of the 2002 EU Directive on national information and consultation. The researchers concluded that many of the organisations studied have systems that fall short of the Directive’s requirements, and that many existing information and consultation schemes are little more than direct information and communication systems - such as newsletters, workplace meetings and e-mails - under which employees have very little say in matters that affect them. Managers tend to guard their own decision-making prerogative while at the same time articulating a need to tap into employee ideas for successful change, the authors argue. The research underlines the rather different meanings often ascribed to information and consultation by managers and employees/unions respectively.
These research findings, along with the earlier research by Roche and Geary (see above under 'Statistics'), indicate that few Irish employers have works councils or joint consultative forums in place which provide for indirect, as opposed to direct, employee 'voice', particularly over higher-level strategic decisions. Overall, the researchers conclude, employers in Ireland prefer to introduce change either unilaterally or through direct employee involvement channels (IE9807120F).
Social partners
Please summarise the views of trade unions on works councils etc and their operation, and outline relations between works councils and trade unions.
Please summarise the views of employers’ organisations on works councils etc and their operation.
Debate on the issue of works councils and similar workplace employee representation and participation structures has recently been fuelled by the EU Directive on information and consultation (IE0106168F), which the Irish government is currently preparing to transpose. The implementation of the Directive will bring Irish industrial relations into uncharted waters, and marks a further move away from its traditional 'voluntarist' system of industrial relations. For the first time, large numbers of employers will have to introduce mandatory mechanisms providing workers with a range of information and consultation rights. This will undoubtedly constitute a substantial culture change, though EWCs have been introduced in a number of Irish-based multinationals and the Irish operations of multinationals based elsewhere have been involved in their EWCs. The new arrangements will be introduced into something of an institutional vacuum. This is particularly so in the case of many non-union companies in Ireland, because it will be the first time that their employment relations policies are subject to so much external scrutiny.
In August 2003, the government published a consultation paper on how the EU information and consultation Directive should be transposed into Irish law (IE0309204F). Interested parties had until late September to make submissions to the government, which intends to publish an Information and Consultation of Employees Bill in the summer of 2004, with a view to enactment by March 2005. This is the transposition deadline set by the Directive, though there are transitional arrangements for Member States, such as Ireland (and the UK), currently without 'general, permanent and statutory' information and consultation systems, allowing these countries to phase in the application of the Directive to smaller undertakings up to March 2008
The Irish Congress of Trade Unions (ICTU) is strongly in favour of works councils. In particular, it hopes that the new EU Directive can play a vital part in improving worker information and consultation rights relating to workplace change and restructuring. Moreover, there is a perception within ICTU that the Directive could potentially facilitate an increase in the diffusion of enterprise-level 'partnership' between employers and employee representatives. However, the Directive could prove to be something of a double-edged sword for Irish trade unions. On the one hand, it would provide a second channel of employee representation. On the other hand, some trade unionists may view any new works council-type forums that emerge as competition, if this means that fewer workers seek trade union recognition. A key concern on the union side - particularly given the decline in union density in Ireland and difficulties securing recognition in the private sector - is to maintain, and, indeed, bolster, the traditional 'single channel' of collective representation, ie through trade unions alone.
Employers' organisations in Ireland are opposed to the introduction of statutory employee representation structures such as works councils, instead preferring a voluntarist solution that reflects the competitive situation of individual companies. They prefer the concept of direct individual employee involvement and direct communication between management and employees to that of indirect collective participation through works councils, which they have criticised as 'old fashioned'. They suggest that works councils are rooted in the 1960s and 1970s, and that the fast pace of change today requires companies to communicate with employees directly.
Employers' objections to works council-type structures in Ireland have not been radically different to those of employers in some other countries, particularly in the UK. The situation in Ireland is made more complex, however, by the large number of US-based multinationals operating there, many of which are used to managing on a non-union basis. Where forthcoming new legislation applies to non-union firms, the prospect of being held accountable to a third party will represent a new development. There is a high density of foreign 'mobile' capital in the Irish economy, and the idea of dealing with works council-type structures is a strange concept to US-based multinationals in particular. In view of this, the Irish Business and Employers Confederation (IBEC) is lobbying for what the unions would call a 'minimalist' interpretation of the EU Directive, primarily due to a concern to protect the prerogative to manage, and wants to maintain and promote existing forms of direct interaction between management and employees. (Tony Dobbins, IRN)