- Phase
- Works Council Act; Civil Code
- Native name
- Wet op de ondernemingsraden; Burgerlijk Wetboek
- Type
- Staff information and consultation on business transfers
- Added to database
- 06 August 2015
Article
Article 25, 26, 31, 35b, and 35c Dutch Works Council Act; Article 7:665 Civil Code
Description
All major strategic decisions with potential consequences for the employees are covered by article 25 of the Works Council Act. This article covers both restructuring and business transfers (transfer of undertaking), but also major investments, closures and mergers and acquisitions. The works council must be informed and consulted and is entitled to all relevant information and has the right to be consulted on economic, business, organisational, legal and social issues, the reasons for restructuring, possible alternatives, consequences for employees and measures taken to limit the consequences. The works council is entitled to at least one consultation meeting with the employer. In principle, a works council should be installed if there are 50 or more employees.
In case of disagreement, the employer has to postpone the decision for one month, during which the works council may decide to go to court. If the advice is not followed by the employer, the works council can challenge the restructuring decision (and possible implementation measures already undertaken). Jurisprudence over the last 35 years shows that employers that have not taken their information and consultation duties seriously run the risk that the court rules the restructuring operation invalid. However, given sufficient care, the managerial prerogative prevails.
The works council in smaller companies
In smaller companies employing between 10-50 employees, the Works Council Act obliges the employer to consult the mini works council, if it exists (the so-called personeelsvertegenwoordiging, which may be established in firms with 10-50 employees) or the staff on any decision that could lead to job loss or a significant change in the employment, labour conditions or working conditions of at least one-fourth of the persons employed in the company. Contrary to the case of works councils, decisions cannot be challenged in court.
According to article 7:665a of the Civil Code, if there is no works council or mini-works council , the employer has to inform the employees in due time about the transfer, the reasons, the timing, the consequences for the employees and possible measures to deal with these consequences.
Citation
Eurofound (2015), Netherlands: Staff information and consultation on business transfers, Restructuring legislation database, Dublin,
https://apps.eurofound.europa.eu/legislationdb/staff-information-and-consultation-on-business-transfers/netherlands