Employees can exercise influence on certain issues relating to the operational management through the right of participation. Depending on the size of the company, the ‘vehicle’ with which this is done is a personnel representative body (PVT), a personnel meeting or a works council (OR).
Organisations with 50 employees or more are obliged under the Works Councils Act (WCA) to set up a Works Council. A Works Council has various rights under the WCA, including advisory rights and the right of consent.
Below, we discuss various rights of the Works Council.
If a company has between 10 and 50 employees, a PVT can be instituted. This is only compulsory if the majority of the employees request such.
Advisory right
Pursuant to Article 25 of the WCA, an entrepreneur must ask his Works Council for advice if there is an important intended decision of a financial-economic and organizational nature that falls under the definition of this article. Due to the fact that the definitions of these subjects are not expressed in very concrete terms in the law, there is some discussion as to whether or not a certain subject falls under the advisory right of the Works Council. For example, sometimes the Works Council has the right to give advice in the event of a reorganisation and sometimes it does not. It depends on the circumstances of the case.
Pursuant to Article 30 of the WCA, the Works Council has the right to give advice on a proposed decision to dismiss or appoint a director of a company.
If there is a right to advice, the advice must be requested in good time, i.e. at a stage when the Works Council can still exert real influence on the decision-making process. If an entrepreneur is confronted with a negative advice from the Works Council, the entrepreneur must wait one month before implementing the decision. During this month, the Works Council has time to turn to the Enterprise Division of the Amsterdam Court of Appeal. This month’s waiting period does not apply to the right to give advice pursuant to Article 30 of the WCA.
