The European Company and Employee Involvement: Some Initial Observations from an Industrial Relations Perspective
Author: Werner, Frank G.
Source: The European Company Statute, Issue data not provided , pp. 85-106(22)
Abstract:After decades of discussion, the European Company (Societas Europaea, or SE) statute was finally enforced in autumn 2004. From the beginning there had been scepticism as to how successful this new legal form would be. By April 2007, there were already about a dozen ‘normal’ companies – in this context, meaning that these companies have operations and employees and, therefore, industrial relations – with around 400,000 employees operating as SEs or advertising that they would change their legal form shortly (see Schwimbersky and Gold in this volume). By September 2007, this figure had risen to around 30 such ‘normal’ SEs, with further companies looking into transformation. Although it may still be ‘too early to talk about how or whether European Companies will develop’ (Kluge, 2006a: 99), it seems possible that the legal form of an SE will become more and more important over the coming years, especially as some ‘big players’ (e.g. the multinational insurance and finance company Allianz, with its German-based headquarters and about 160,000 employees worldwide) are establishing SEs. Thus, more and more employees are, or will be, working in SEs. The question arises with this new legal form as to how their interests will be represented in the corporate governance system and at the level of works councils. This question is discussed increasingly frequently from a legal perspective (Nagel et al., 2005; Manz et al., 2005; Blanke and Köstler, 2006; Van Greven and Storm, 2006), but this chapter will do so from an empirical, Industrial Relations (IR) perspective.
The chapter is structured as follows: some basic institutional aspects of the SE in general, and employee involvement in this new legal form in particular, are first discussed. Employee involvement is regulated by a Directive – the Directive supplementing the Statute for a European Company with regard to the involvement of employees (2001/86/EC) – that had to be transposed into national law by autumn 2004. Some problems, which will become clear in an empirical analysis of employee involvement in the earliest SEs, are not surprisingly already laid down in these institutional preconditions. An overview is then given of existing SEs and those being established. By September 2007 there were around 100 SEs in existence, though only a third could be regarded as ‘normal’, that is, with economic activity and employees. The next section focuses on an initial empirical assessment of existing SEs. These companies are already meeting the terms of employee involvement in a concrete way, which allows for an initial analysis and assessment. And, no less important, these cases could provide a blueprint for other companies wanting to change into or become an SE. The varieties of employee involvement established and assessed in existing SEs could easily pave the way for new cases in the future. It is therefore important to know what employee involvement entails in existing SEs, and where the problems lie.
Document Type: Research Article
Publication date: January 1, 2009
- The European Company Statute
The European Company Statute (ECS) is one of the most important pieces of company legislation adopted so far by the European Union. Its aim is to regulate, on a voluntary basis, the internal functions of a business operating in more than two European countries at the same time. This book provides a comprehensive analysis of the history, structure, legal basis and likely impact of the ECS, examining its evolution over some 30 years of development and its chances for integrating diverse models of corporate governance across the European Economic Area. The book explores the implications of the ECS for employee participation at various levels in the European company, with country case studies drawn from Greece, Slovenia and the UK. It also analyses certain legal issues, including taxation and the position of companies located in countries without existing systems of employee board-level participation.
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