From: MichaelP <[EMAIL PROTECTED]> Date: Tue, 4 Nov 1997 21:11:07 -0800 (PST) Subject: EU to make firms consult workers on business plans THE European Commission will prepare the way today for a new law under the social chapter that would require all but the smallest firms to consult their employees on future policy and would render void any sackings without such action. The move, which would greatly extend an existing law that covers large multinational companies, is aimed at bringing Britain and Ireland into line with continental practice which requires firms to operate works councils. The Government has criticised the idea as an unnecessary burden on business but, under the social chapter, which Britain is joining in the Treaty of Amsterdam, any opposition could be overruled by a majority vote. The Commission's decision comes as ministers meet in Brussels today to prepare for the European Union "jobs summit" later this month at which Britain will press for easing the burden of regulations on employers. Tony Blair has been urging EU leaders to refrain from using the social chapter to pass new laws that could inflict more red tape on business. Britain has already signed up to laws on parental leave, the rights of part-time workers and shifting the burden of proof in sexual discrimination cases. The proposed law on consultation will test the Government's commitment to improved workers' rights against the potentially conflicting drive for more flexible labour regulation. Under the rules of the social chapter, the Commission will give EU employers' organisations and unions six weeks to decide whether to negotiate their own version of a consultation law. Failing this, Padraig Flynn, the Social Affairs Commissioner, will submit a draft law for the member states to enact. In an initial discussion this summer, employers resisted the scheme and unions favoured it. Two pieces of legislation have already been enacted through agreement between the social partners, as the employers and unions are called. British officials said yesterday that Government favoured such negotiations as the best route for drafting the proposed consultation law. However, when the idea was first mooted last June, Downing Street said: "We are not in favour of new regulation in this area." The legislation is intended to curb "social dumping", in which "companies shop around for places that have low requirements in industrial relations", an EU official said. Britain, with its low employment costs, is deemed on the Continent to be the worst "offender". A commission document released today says the proposed law would provide equal treatment for all workers across the EU "to avoid discrimination and to ensure greater compatibility between national provisions". It must enshrine "the right of workers to be informed and consulted ... on the economic situation and the future outlook of the company and on any decisions likely to affect them". This is intended to benefit workers and companies by improving morale and helping staff to adapt to rapidly changing conditions. Mr Flynn wants the law to have teeth in the form of penalties against firms that flout the legal obligation to consult. Public pressure on the Commission for such action has come from highly publicised cases of factory closure, notably a decision by the vehicle manufacturer Renault to sack 2,000 workers at its plant in Brussels earlier this year. The main proposed penalty would be to annul dismissal notices or any other decisions affecting the conditions of employment. The Commission is not formally setting the size of company that will come under the law, but Mr Flynn has cited a minimum of 50 employees as a desirable target. Under the existing multinational law, which is deemed by many British companies to have been beneficial, only firms employing at least 2,000 workers in two or more member states are required to set up works councils. The Commission insists that the new scheme should allow for a less formal structure than works councils. ** NOTICE: In accordance with Title 17 U.S.C. Section 107, this material is distributed without profit to those who have expressed a prior interest in receiving this information for research and educational purposes. **
