Frequently asked questions (FAQ)

This page contains questions frequently asked about European Study Group, I&C legislations, European Works Councils and other workplace matters. It also contains a few questions that are not so frequently asked but perhaps ought to be!

Click on any question to see its answer.

Frequently asked questions

What is European Study Group?
Why should an employer join European Study Group?
Which organisations are currently members of European Study Group?
Why is the UK introducing new law on Information and Consultation?
Which organisations will be affected by the new law, and when?
What is the new law on Information & Consultation of Employees?
Does the new law mean that employers will have to start informing and consulting employees from 6th April 2005?
What are European Works Councils?
What types of organisations have to have a European Works Council?
Does the law provide for an alternative to a European Works Council?
How many UK companies have an EWC and what do they cost to run?
Now there are 25 countries in the EU how are all the different languages catered for at EWC meetings?

What is European Study Group?
Established in 1990, European Study group is an association of employers whose members network and benchmark with each other on UK workplace and transnational information and consultation arrangements. Member companies are also kept up to date with developments in EU social and employment legislation.
back to top >>

Why should an employer join European Study Group?
Essentially to obtain the benefits of membership which gives access to unmatched expertise, practical help and advice, invaluable networking and benchmarking as well as the opportunity to input to the development of emerging social and employment legislation as a result of the contacts ESG has developed with the UK Government and the European Commission. In addition, members have access to tailor-made consulting services to assist with implementation of practical solutions to I&C issues.
back to top >>

Which organisations are currently members of European Study Group?
Member companies include FTSE 100 companies as well as subsidiaries of foreign multinational organisations. Members are from a wide range of industrial and commercial sectors embracing banking and Insurance, Food, Drink and Tobacco, Manufacturing, Service Organisations and Conglomerates.
back to top >>

Why is the UK introducing new law on Information and Consultation?
Like the law on transnational information and consultation, new UK legislation on information and consultation (I&C) arises from a European Directive adopted in 2002. This Directive requires Member States to enact law that gives employees in companies of a certain size the right to be informed and consulted on a range of issues that affect them at work. Most of the countries of continental Europe have had law concerning workplace I&C for many years whereas, in the UK and Ireland, I&C on general employment issues has been a feature of the voluntarist system of industrial relations.

It will be recognised that there has been a legal obligation on employers to consult about health & safety and in the event of collective redundancies and business transfers for a number of years and the UK Regulations concerning these issues remain in force even when the new law becomes effective in April 2005.
back to top >>

Which organisations will be affected by the new law, and when?
On 6th April 2005, undertakings (i.e. legal entities) with 150 or more employees become affected by the law. The law is extended on 6th April 2007 to cover undertakings employing 100 or more employees and is further extended on 6th April 2008 to cover those employing 50 or more employees.
back to top >>

What is the new law on Information & Consultation of Employees?
The new law gives employees in those companies affected by the legislation the right to be informed and consulted, provided the employees request that arrangements are established that will enable them to exercise the right given to them under the law.

These arrangements can be established by agreement between employer and employees but if, following a valid request, the employer refuses to discuss arrangements, or following discussion agreement cannot be reached then the law prescribes the arrangements that must be established. These are generally referred to as “the fallback” arrangements but are actually designated “standard provisions” in the Regulations.

back to top >>

Does the new law mean that employers will have to start informing and consulting employees from 6th April 2005?
No. Under this law the obligation on a employer to inform and consult only arises following a valid request from employees. A valid request is defined as one or more requests that amount to 10% of the employees of the undertaking requesting that I&C arrangements be established. The 10% trigger, as it is being called, is subject to a minimum of 15 employees requesting and a maximum of 2,500 employees requesting which means small employers are subject to a higher trigger than 10% and large employers subject to a much lower trigger than 10%.

Employers therefore need do nothing until they receive a valid request. Alternatively an employer may have been consulting for a number of years with arrangements that have grown out of perhaps their historical collective bargaining arrangements with recognised trade unions and as such is free to carry on informing and consulting under such arrangements.

back to top >>

What are European Works Councils?
A European Works Council (EWC) is either a French style employee-management body or a German style employee-only body established to provide a mechanism for information and consultation of employees, specifically on transnational issues. The obligation on a multinational employer to establish such a body is dependent on there being an employee request for the establishment of transnational arrangements. Multinational employers are of course also free to decide for themselves to establish an EWC without there being a request. The European Works Council Directive of 1994 required each Member State to enact law providing for the formation of an EWC by September 1996. Because of the UK’s initial opt out from the social chapter of the Maastricht Treaty, UK law on transnational information and consultation of employees was not enacted until 1999.
back to top >>

What types of organisations have to have a European Works Council?
The organisations that come within the scope of the law on transnational information and consultation are those that employ at least 1000 people in the Member States of the European Economic Area (i.e. the countries of the EU plus Iceland, Norway and Liechtenstein) plus employing at least 150 employees in at least each of two member States. However, no organisation has to have an EWC unless they wish to have one or unless the employees make a valid request for an EWC to be established. A valid request is a written request from at least 100 employees, or their representatives, in at least two different Member States.
back to top >>

Does the law provide for an alternative to a European Works Council?
The directive and therefore Member State law does indeed provide for an alternative to an EWC by making provision for “a European Works Council or a procedure for the purposes of informing and consulting employees”. However, whilst the law describes in some detail what an EWC is and should be, nowhere does it indicate what a procedure might be and how it might operate. Consequently and perhaps for reasons of legal certainty there are no obvious precedents regarding the establishment of a transnational procedure.

Because of the limited effectiveness of some of the EWC’s that are in place, European Study Group has developed a procedural model that is being looked at quite closely by a number of member companies as the next stage in the development of their transnational information and consultation arrangements – this particularly so in the light of the forthcoming legislation on UK workplace information and consultation.

back to top >>

How many UK companies have an EWC and what do they cost to run?
It is estimated that to date, some 120 UK based multinational companies have established transnational arrangements most, if not all, of these being in the form of a European Works Council. However, it is more often the case in the UK that an EWC is referred to as a European Employee Forum, or some similar designation.

There are of course many variables that contribute to the cost of running an EWC, not least of which is the number of countries of the EEA in which the company operates, and the number of meetings held, the extent to which translation and interpretation is required etc. An average figure however has been estimated in the region of £75,000 per annum for up to two meetings a year.

back to top >>

Now there are 25 countries in the EU how are all the different languages catered for at EWC meetings?
Generally, the majority of companies with an EWC have not yet felt the full impact of having representatives from the accession countries present at EWC meetings. Some have had representatives present as observers during the run up to May 2004 but in these cases those present have had some facility with English. However, most report that language is going to be a problem and that the cost of providing translation and interpretation at meetings is going to add very significantly to the costs of running the EWC.
back to top >>