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Works Council may be dissolved after refusal to work with the personnel manager

The Regional Labor Court (Landesarbeitsgericht – LAG) Düsseldorf decided on 23 June, 2020 on the question whether the works council may refuse to cooperate with an employer representative, decision of 23 June, 2020, 14 TaBV 75/19. The LAG rejected this on the grounds that the works council was thus significantly in breach of its obligations under works constitution law and dissolved the works council at the request of the employer pursuant to sec. 23 para. 1 of the Works Constitution Act (Betriebsverfassungsgesetz – BetrVG).

The parties disputed the employer’s request to dissolve the 13-member works council according to sec. 23 para. 1 BetrVG. For this purpose, the works council must have committed an obviously grave dereliction of its statutory duties.

The reason for the application by the employer, a manufacturer of light metal rims with almost 700 employees, was that the works council refused to cooperate with the personnel manager designated by the employer as the competent contact person. This was formally decided by the works council. Among other things, the works council informed the plant and personnel management that the cooperation with the personnel manager would be terminated and requested the employer to appoint a new contact person. In further implementation of the decision, the works council removed the personnel manager from the distribution list and forwarded communications and resolutions to other employees. Despite the employer’s requests to cooperate with the personnel manager again, the works council maintained its refusal and informed the plant management that it had again decided to terminate the cooperation with the personnel manager. The works council had already previously announced that it would not attend meetings in which the personnel manager was also present, which the works council then put into practice, for example, by not participating in a discussion on the implementation of personnel planning from an existing reconciliation of interests. Finally, the employer saw no other way but to send the works council a “works constitution warning” and to ask it one last time to resume cooperation with the personnel manager. In the event that the works council did not comply with this, the employer announced that it would initiate a resolution procedure pursuant to sec. 23 para. 1 BetrVG and request the works council to be dissolved.

However, the situation escalated increasingly in the following, so that the employer ultimately felt compelled to actually file the announced application to dissolve the works council with the Solingen Labour Court (Arbeitsgericht Solingen). The Solingen Labour Court decided in favour of the employer to dissolve the works council by order of 04 October, 2019 (1 BV 27/18). The works council opposed this with a complaint to the LAG.

The LAG confirmed the decision of the Solingen Labor Court and dissolved the works council pursuant to sec. 23 para. 1 BetrVG. Although the dissolution of the works council is a particularly drastic sanction and high hurdles must be overcome, the LAG also came to the conclusion that, taking into account all the circumstances of the individual case, in particular the operational circumstances, the continued exercise of the works council’s office was unacceptable. It confirmed the opinion of the Solingen Labor Court that the works council’s refusal to cooperate with the personnel manager appointed by the employer as the competent contact person constituted a significant and obviously serious breach of duty. The works council had formally adopted the refusal position and had in fact implemented it over a longer period of time. The LAG Düsseldorf also clarified that the determination of a contact person is solely incumbent on the employer due to its organizational sovereignty. Even if the personnel manager had possibly not acted in conformity with the works constitution in all points, the works council was not allowed to simply terminate the cooperation with the personnel manager by way of self-help. Instead, it should have used the means provided by the Works Constitution Act. By its conduct, the works council had manifestly and seriously infringed the requirement of cooperation based on trust.

The decision of the LAG is not yet legally binding at this point in time. Nevertheless, the decision makes it very clear that there are limits to the actions of the works council. Even if the requirements for grave dereliction of statutory duties by the works council are very high, these are regularly fulfilled in any case when the works council infringes on the organizational sovereignty of the employer and disregards the possibilities of action under Works Constitution Act.

Dr. Lorenz MittererAnna-Julia Quarg
AttorneyAttorney
Specialist Lawyer for Employment Law

ZL-News
Bereich Arbeitsrecht on

Works Council may be dissolved after refusal to work with the personnel manager

The Regional Labor Court (Landesarbeitsgericht – LAG) Düsseldorf decided on 23 June, 2020 on the question whether the works council may refuse to cooperate with an employer representative, decision of 23 June, 2020, 14 TaBV 75/19. The LAG rejected this on the grounds that the works council was thus significantly in breach of its obligations under works constitution law and dissolved the works council at the request of the employer pursuant to sec. 23 para. 1 of the Works Constitution Act (Betriebsverfassungsgesetz – BetrVG).

The parties disputed the employer’s request to dissolve the 13-member works council according to sec. 23 para. 1 BetrVG. For this purpose, the works council must have committed an obviously grave dereliction of its statutory duties.

The reason for the application by the employer, a manufacturer of light metal rims with almost 700 employees, was that the works council refused to cooperate with the personnel manager designated by the employer as the competent contact person. This was formally decided by the works council. Among other things, the works council informed the plant and personnel management that the cooperation with the personnel manager would be terminated and requested the employer to appoint a new contact person. In further implementation of the decision, the works council removed the personnel manager from the distribution list and forwarded communications and resolutions to other employees. Despite the employer’s requests to cooperate with the personnel manager again, the works council maintained its refusal and informed the plant management that it had again decided to terminate the cooperation with the personnel manager. The works council had already previously announced that it would not attend meetings in which the personnel manager was also present, which the works council then put into practice, for example, by not participating in a discussion on the implementation of personnel planning from an existing reconciliation of interests. Finally, the employer saw no other way but to send the works council a “works constitution warning” and to ask it one last time to resume cooperation with the personnel manager. In the event that the works council did not comply with this, the employer announced that it would initiate a resolution procedure pursuant to sec. 23 para. 1 BetrVG and request the works council to be dissolved.

However, the situation escalated increasingly in the following, so that the employer ultimately felt compelled to actually file the announced application to dissolve the works council with the Solingen Labour Court (Arbeitsgericht Solingen). The Solingen Labour Court decided in favour of the employer to dissolve the works council by order of 04 October, 2019 (1 BV 27/18). The works council opposed this with a complaint to the LAG.

The LAG confirmed the decision of the Solingen Labor Court and dissolved the works council pursuant to sec. 23 para. 1 BetrVG. Although the dissolution of the works council is a particularly drastic sanction and high hurdles must be overcome, the LAG also came to the conclusion that, taking into account all the circumstances of the individual case, in particular the operational circumstances, the continued exercise of the works council’s office was unacceptable. It confirmed the opinion of the Solingen Labor Court that the works council’s refusal to cooperate with the personnel manager appointed by the employer as the competent contact person constituted a significant and obviously serious breach of duty. The works council had formally adopted the refusal position and had in fact implemented it over a longer period of time. The LAG Düsseldorf also clarified that the determination of a contact person is solely incumbent on the employer due to its organizational sovereignty. Even if the personnel manager had possibly not acted in conformity with the works constitution in all points, the works council was not allowed to simply terminate the cooperation with the personnel manager by way of self-help. Instead, it should have used the means provided by the Works Constitution Act. By its conduct, the works council had manifestly and seriously infringed the requirement of cooperation based on trust.

The decision of the LAG is not yet legally binding at this point in time. Nevertheless, the decision makes it very clear that there are limits to the actions of the works council. Even if the requirements for grave dereliction of statutory duties by the works council are very high, these are regularly fulfilled in any case when the works council infringes on the organizational sovereignty of the employer and disregards the possibilities of action under Works Constitution Act.

Dr. Lorenz MittererAnna-Julia Quarg
AttorneyAttorney
Specialist Lawyer for Employment Law