Germany’s stance on workers’ representation set for major change

As the German elections near, the EU is gearing up for the fight over the revision of the Works Council Directive.

For German mining, steel and coal workers, co-determination even at the board level has been around since 1951. Worker’s associations credit much of Germany’s economic success with the fact that employees have a say in the executive decisions companies make, arguing that worker representation improves decision making quality. 

“Co-determination at the company level … is of the utmost importance for the future of our country,” said social democrat chancellor hopeful Olaf Scholz at an event commemorating the 70 year anniversary of worker’s co-determination in Germany in June 2021. 

He added that there was still a lot to do in Germany in that regard, pointing out that the number of employees needed for co-determination to become mandatory must be lowered.

Scholz’s SPD continues to top the polls ahead of Germany’s federal elections on September 26.

His party traditionally understands itself as a worker’s party, meaning that a shift on worker representation issues in German and therefore EU politics may take place.

“Companies’ success is earned by their employees,” says the SPD’s election programme. “That’s why we’re improving their co-determination, ” it continues.

The party aims to implement wide-sweeping reforms to bolster workers’ voices in companies, including equal representation at the board level for all companies of a certain (unspecified, but lower than the status quo) size.

The SPD programme makes further mention of strengthening the European works council as well, as the directive governing them is expected to receive a revision proposal by the European Commission in the coming months.

The conservative CDU has also embraced the issue.

“Without co-determination, it would not have been possible to shape the entire structural change in this socially acceptable way,” said conservative chancellor hopeful Armin Laschet at the event, noting that companies which had workers co-decide tend to be more stable and successful.

The conservatives kept their programme vague on specific steps as to how they would further worker’s co-determination in government, according to an analysis by Kay Meiners and Andreas Molitor at the Hans-Böckler institute.

In Germany’s so-called social market economy and its social partnerships, to be economically right and yet speak up on behalf of workers has always been more socially acceptable than elsewhere.

This is best evidenced by its long history of workers’ board-level representation in spite of decades of conservative government.

The deciding factors

Much of Germany’s ultimate political stance on issues will depend on the coalition that is formed after the elections, which is likely to include the Greens, FDP or Die Linke.

“Regardless of whether it’s a foundation or a Societas Europaea – co-determination must be guaranteed everywhere,” said Beate Müller-Gemmeke, speaking on behalf of the Greens. The Greens want to close legal loopholes that allow companies to circumvent workers’ co-determination by splitting up the firm without formal control arrangements.

The business-friendly liberal FDP, on the other hand, makes no mention of workers’ co-determination in their party programme, Meiners and Molitor found in their analysis.

The leftist Die Linke, meanwhile, aims to close loopholes that corporations utilise to circumvent co-determination rules, they want to criminalise the maltreatment of works councils by executives and for board level workers’ representation to kick in at a company size of 500 employees.

German election 2021: Key numbers, forecasts and projections

In Europe’s key election this year, Germany chooses a new parliament – and Angela Merkel’s successor – on 26 September. Who will get to lead the continent’s biggest economy? Will the Greens with Annalena Baerbock have the edge over Armin Laschet’s conservative CDU/CSU? Or will the Social Democrat SPD be the dark horse of these polls?

[Edited by Benjamin Fox]

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