New Rules for European Work Councils coming soon

The new revision of the directive on European Works Councils is one step closer. On 9 October 2025, the European Parliament approved the revision. The approval by the Council of the European Union is on today’s agenda. The new directive aims to strengthen the functioning of European Works Councils and  effective consultation. This newsflash outlines the key changes. 

In 1994, the Directive on the establishment of a European Works Council was adopted. This directive provided for information and consultation of employees in transnational matters within an undertaking or group of undertakings. More specifically, it applied to undertakings with at least 1.000 employees within the Member States, and with undertakings in at least two Member States, each employing at least 150 employees. 

Under the Recast Directive in 2009, the obligations regarding information and consultation of employees were reinforced, and the European Works Council was probably more empowered. However, this proved insufficient: in 2018, the European Parliament initiated a new revision of the directive, recognizing the need for further reform. The current text is considerably less ambitious than the original version, which was proposed by the European trade unions. For instance, the unions advocated for the right to block management decisions in court. Also the possibility for judges to impose GDPR-size fines, up to EUR 20 million or 4% of global annual turnover, was ultimately not retained. 

These are the key changes: 

• Exemptions (old Article 13 agreements) are abolished: All groups of undertakings that meet the requirements for establishing a European Works Council (EWC) will be required to set one up in accordance with the rules of the Directive. This change is expected to impact approximately 350 groups of undertakings.
  • Groups of undertakings that had already concluded an agreement on transitional information and consultation at the time the original directive entered into force in 1994 were not required to comply with the Directive’s rules. These agreements may remain in effect. However, employees or employee representatives may request to conclude a new agreement in accordance with the new rules.
  • The same applies to agreements that were concluded or amended between 5 June 2009 and 5 June 2011.
• The consultation procedure is revised, as it has become clear that consultation within European Works Councils is often ineffective. The consultation process must enable employee representatives to express an opinion. The central management must provide a reasoned written response to this opinion before any decision can be taken on a transnational matter.
• Confidentiality must be justified: invoking confidentiality must be properly substantiated, particularly when sharing information, for example, with the local works councils and employees, is restricted. In the past, companies were found to  impose excessively broad confidentiality obligations that hindered genuine consultation.
• The definition of transnational is revised: European Works Councils must be consulted on transnational matters. A new definition clarifies that also envisaged measures affecting employees in one Member State, which may reasonably be expected to have consequences for employees in at least one other Member State, fall within the scope of consultation with the European Works Council. However, the concept remains unclear and is likely to give rise to endless discussions in practice.
• More balanced gender composition: women are underrepresented in most European Works Councils. When (re)negotiating an agreement, measures must be taken to ensure a balanced representation of men and women within the European Works Council: 40% of the seats for women and 40% for men.
• Necessary capacity: European Works Councils must be provided with the necessary resources to carry out their work. EWC agreements must specify the financial and material resources to be allocated to EWC, at least with respect to the use of experts, legal costs, and training.
• Improved access to legal remedies: Member States must notify the Commission of the manner by which rightsholders can initiate judicial and, where relevant, administrative proceedings concerning their rights under the Directive. Member States are also required to establish effective, dissuasive, and proportionate sanctions to enforce the Directive. 

Key message

Once the new Directive is published, Member States will have two years to transpose it into national law. The new rules will then enter into force one year after that date. During this transitional period, new European Works Councils will need to be established, and existing EWC agreements to be renegotiated.