Where are European works councils?-an update

Widespread pressure within the European Community and the member states to promote employee information and consultation through European works councils continues to be an issue complicating the Maastricht Treaty's ratification and implementation. However, European works councils established voluntarily are already in operation in several transnational companies and funds have been available since 1992-administered by the Commission on a vote from the European Parliament-to promote and facilitate the councils pending the adoption of a formal directive. This article comments on this significant but under-reported development.     

Codetermination and personnel policies of German firms: the influence of works councils on turnover and further training

The paper analyses the contribution of works councils to the overall success of German firms during the last few decades. It is argued that a successful implementation of flexible specialization strategies is the cornerstone of German prosperity. The acquisition and effective utilization of firm-specific skills is a precondition of successful flexible specialization. Effective skill utilization itself needs cooperation between employers and employees in order to safeguard the specific investments of either side. Thus, the crucial question is whether the dual system of worker representation in Germany, and particularly the part of the works councils therein, is an efficient institution in the sense that it guarantees the necessary co-operation. In analysing the effects of works councils on personnel turnover and vocational training, we find the works councils to be organizationally efficient, i.e., they balance out employers' and employees' interests. The legal structure underlying the dual system is found to be institutionally efficient because it guarantees this result. Even in times of crisis and if exposed to great pressure, the dual system seems to remain stable, as is illustrated in the light of recent labour market developments that have been triggered by German unification and the last recession.     

Embedded collectivism? Workplace representation in France and Germany

In most countries of Western Europe it makes little sense to speak of non‐union employee representation, as this is understood in the Anglo‐American world, for the principle of collective representation independent of the employer is strongly institutionalised. In this article we examine experience in two countries. In Germany, works councils with a wide repertoire of rights typically work in close partnership with trade unions. The system has experienced strains in recent years, and a growing proportion of mainly smaller workplaces are covered neither by councils nor by collective agreements; but there is virtually no evidence of alternative ‘voice’ mechanisms, and systems of direct participation are normally introduced by negotiation with councils. In France, works committees have fewer powers, and a divided trade union movement has been less successful than its German counterpart in ‘embedding’ the legally mandated institutions, at least in the private sector. Despite some common trends in both countries, national distinctiveness remains very apparent. There is growing scope for managerial strategic choice, but this is still institutionally bounded. Much more generally, countries displaying characteristics of a ‘European social model’ can be expected to sustain a close articulation between union and ‘non‐union’ channels of representation.     

Trade union shopfloor representation in Germany

Most publications on German industrial relations tend to focus on works councils but miss trade union delegates and senior delegates. Seeking to address this lack of research, a case study of a large manufacturing plant is used to examine the role of union delegates and senior delegates and their relationship to works councils. The case study seeks to show why works councils are inextricably linked to the union movement, even though both are structurally separated. Research findings support the notion that both are in a mutually supportive relationship. Furthermore, the evidence also suggests that trade union shopfloor representation is of crucial importance for works councils, industrial democracy and trade unions in German industrial relations.     

Just vote no! Union–busting in the European fast–food industry: the case of McDonald’s

This paper examines the problem of effectively regulating the labour relations practices of multinational corporations. It focuses on the activities of the McDonald’s Corporation in a number of European countries. The findings suggest that public and private codes of conduct have a very limited effect and that determined and well–resourced corporations can not only undermine regional forms of regulation—such as that provided by the European Union—but also, and to a considerable extent, national–level regulation. This is particularly evident in the area of independent trade union representation. Although its aim of avoiding collective bargaining and union recognition wherever possible is only partially successful, McDonald’s appears to have developed a number of highly effective strategies for limiting the presence of trade unions at restaurant level, particularly in avoiding or undermining statutory works councils and union representation rights.     

Recast directive on European works councils: cosmetic surgery or substantial progress?

Overdue by nine years, contested by employers and awaited by trade unions, a review of the European works council Directive 94/45/EC finally became reality in 2009. This article presents background information about the positions of the European social partners and other institutional EU actors in order to understand the outcome of the events of 2008–09. Focus is directed towards providing a general overview of the new elements in the recast directive on European works councils (EWCs). Keeping the different views on EWCs of the social partners in perspective, the article argues that the recast directive, despite its shortcomings, represents progress rather than superficial cosmetic surgery.     

Widening the lens: a structuration theory perspective on European works councils and transnational labour relations

This article outlines a concept for analysing practices of European works councils. Much previous research has focused its attention merely on a single institution or actor, for instance the European works council, transnational agreements or trade union federations. However, previous research in the field suggests that transnational labour relations often involve many actors on different levels inside and outside an MNC who interact, refer to different cultural patterns and draw power to act from various sources. To cover those processes, a structuration theory framework is developed that models different ‘action fields’, which actors refer to in their social practices of cross‐border employee representation. The framework is illustrated with case studies of Toyota and General Motors. The benefits and limitations of the new perspective are discussed with reference to previous accounts.     

Flexible collective bargaining agreements: Still a moderating effect on works council behaviour?

We analyse the interaction between different labour market institutions in Germany, namely, industry‐level bargaining and firm‐level codetermination by works councils. In particular, we are interested in the moderating effect of flexibility measures on the link between the existence works councils and collective agreements on wages and productivity. In presence of institutional changes, the question is whether works councils in covered plants still generate rather than redistribute rents, given recent decentralisation processes in the German system of industrial relations. We augment a theoretical model to provide hypotheses, which are then tested using empirical analysis of representative German plant level data. We find that the existence of flexibility provisions in collective bargaining agreements does not alter the effect of works council on firms' wages. We find, however, that with flexibility provisions works council presence is associated with higher productivity levels than without such provisions. These findings, however, depend on the level of collective bargaining: they can only be observed in plants covered by industry‐level contracts, but do not hold in plants covered by firm‐level contracts.     

A comparison of the effectiveness of unions and non-union works councils in Korea: can non-union employee representation substitute for trade unionism?

Using survey data from 857 employees of three unionized and three non-union establishments in Korea, this study compares the effectiveness of unions and non-union employee representation (NER). Union members appear to expect more from and to be more satisfied with unions than is the case for non-union employees regarding the activities of non-union works councils. This tendency is stronger in regard to distributive and employee advocacy issues than to mutual interest issues. Union members express stronger commitment to their unions than do non-union employees to their works councils. However, union members and works council members are not significantly different in terms of organizational commitment, job satisfaction and perceived industrial relations climate. Overall, the findings indicate that the structural weaknesses of NER are more evident than its positive attitudinal effects.     

Digitalisation,unions and participation: the German case of ‘industry 4.0’

This article tackles the question of how labour representatives cope with the implementation of ‘Industrie 4.0’ in German manufacturing plants. Digitalisation of manufacturing is going along with challenges for employment, work organisation and working conditions. The article analyses one of the main strategies German unions have developed, the project ‘Work 2020’, which was to raise works councils' awareness of the workplace impact of digitalisation, improve their knowledge of the changes, raise their capacity to respond and, finally, lead to the negotiation of workplace agreements on this issue with employers. The results of the analysis show that a strong interplay between unions and works councils and the activation of works councils by the unions have become indispensable preconditions for coping with the new challenges both of digitalisation and of the ongoing erosion of the German system of labour relations.     

Trends and developments in east central European industrial relations

This article overviews developments in industrial relations in the Czech Republic, Hungary and Poland since the fall of the communist regimes in 1989, and assesses the extent to which key developments in these countries reflect both change and continuity from the communist period. We explore the four main institutions through which industrial relations have been conducted: trades unions, workers’ councils, employer organisations, and the tripartite arrangements involving representatives of unions and employers with the state.     

Joint governance in North American workplaces: a glimpse of the future or the end of an era?

North American innovations in joint governance (such as Saturn, NUMMI, Xerox, and Shell Sarnia), though limited in number, have drawn world-wide attention from line and staff practitioners, as well as policy makers. These voluntary initiatives in unionized North American settings stand as an important counterpoint to two alternative forms of innovation – legislated forms of joint governance such as European works councils and non-union high-commitment systems that are most common in North America. Current debates on workplace governance in North America are implicitly and sometimes explicitly choosing among these three innovative arrangements as alternative ‘ideal types’. This article begins with nine hypotheses on joint governance, which are derived from case-study analysis. The hypotheses focus on the antecedents, dynamics and consequences of joint governance. Together, they can help guide practitioners seeking diffusion of joint governance concepts. The hypotheses can also help guide the construction of public policy on workplace governance. Ultimately, the question remains – are these initiatives a glimpse of the future or do they mark the end of an era?     

Direct and representative participation in Europe: recent survey evidence

Despite the wealth of literature on HRM and employee involvement, now there has been a remarkable lack of large-scale survey evidence on the diffusion employee involvement in work organizations in Europe. This gap in large-scale survey evidence on the diffusion of direct employee participation has now been filled representative sample of workplaces in ten major European Union countries which commissioned by the European Foundation for the Improvement of Living and Working Conditions in Dublin (the EPOC project). It is by far the most comprehensive overview of the implementation and effects of direct employee participation of its kind. The paper shows that, on the basis of the EPOC survey results, there appears to considerable gap between the rhetoric and reality of direct participation. The paper shows that while the incidence of different forms of direct participation was widespread ten countries, the scope, in terms of number of issues involved and the number of given to employees, was relatively limited for most direct participation forms. The survey also showed that the introduction of direct participation posed little threat to trade representatives. Indeed, works councils and union representatives were in most 'agents of change' rather than barriers to the development of the more intensive practice of direct participation.     

The interests of white‐collar workers and their representation in the German manufacturing sector: new initiatives,opportunity structures,framing and resources

In the German manufacturing sector, white‐collar workers have outpaced blue‐collar workers in numbers. Therefore, unions and works councils have launched initiatives to attract, mobilise and organise white‐collar workers. The analysis is drawing on a conceptual framework that looks at the opportunity structures, framing processes and resources of the initiatives.     

To merge or not to merge? The impact of union merger decisions on workers' representation in Germany

Union mergers have been widely studied in a variety of countries; however, little is known about their impact on union effectiveness. This article draws on in‐depth interviews with officials and works councillors from four German unions, as well as on a representative survey of German works councils, to analyse how a union's merger status shapes its effectiveness in three spheres of activity: political lobbying, collective bargaining and establishment‐level interest representation. We compare two cases of merger with two cases of continued organisational independence, finding that merger outcomes for individual unions vary considerably across our three union functions.     

The right to participate

A basic principle of democracy holds that all citizens have a right to participate in decisions that affect their personal interests, including decisions taken in the context of employment. Most industrialized, market economy democracies have created institutions to ensure that this right is effective. In North America, however, the right to participate in the making of critical employment decisions has not been secured, largely because of perverse, adversarial dynamics elicited by labor relations statutes. Universal, statutory participation via works councils is proposed as a means of making the right effective.     

MONOPOLISTIC COMPETITION AND PRODUCT DIVERSITY: REVIEW AND EXTENSION

Abstract The modeling of monopolistic competition has contributed to rapid developments in numerous fields of economics, notably macroeconomics, international trade, industrial organization, economic growth and economic geography. This paper provides a systematic review and some extensions of various path‐breaking models of monopolistic competition and their subsequent developments, including the works of Spence, Dixit and Stiglitz that are based on the ‘love‐of‐variety’ approach, the works of Lancaster that are based on the ‘love‐of‐characteristic’ approach, and the large‐group monopolistic competition models of Hart, among others. The paper also examines the properties of some utility functions frequently used in the literature on models of monopolistic competition. Perhaps owing to the complexity of these models, the literature lacks a broad and systematic coverage of this essential subject. The paper aims to help fill the gap.     

Seniority wages and establishment characteristics

A representative linked employer-employee panel and an innovative two-step estimation strategy are used to show that large and profitable establishments as well as establishments with a highly qualified workforce pay high seniority wages. Also collective bargaining coverage, works councils and reduced working time for older employees are positively correlated with seniority wages, the share of foreigners, females as well as initial wage levels for job entrants are negatively correlated. These results support an agency based motivation for seniority wages with older employees' wages set higher than their productivity.     

British industrial relations and the European Community

The purpose of this paper is to review the influence that Britain's membership of the European Community has had on industrial relations in Britain. More specifically the so-called ‘Social Dimension’ of the 1992 internal market is assessed. The conclusion is that British industrial relations will continue to be influenced by developments in the European Community for the rest of the 1990s and beyond. However, it is more likely that there will be a weaving of a European dimension into national industrial relations systems rather than the imposition of a new EC-wide model.     

Employee participation and productivity

This paper measures the productivity impact of shop-floor employee involvement. On the basis of a representative German establishment data set, the study finds that the introduction of teamwork and autonomous work groups, and a reduction of hierarchies in 1996/1997 significantly increased average establishment productivity in 1997–2000. The estimation strategy controls for unobserved invariant establishment heterogeneity by using a two-step system GMM panel regression approach. It simultaneously takes account of endogeneity of participative work organization by instrument variable regressions. It is also shown that the productivity effect of shop-floor employee involvement is stronger in establishments with works councils.