Section 25 of the Dutch Works Councils Act (Wet op de Ondernemingsraden (‘WOR’)) stipulates in which cases an employer must request the Works Council’s advice. It also occurs, however, that the Works Council’s advice is requested while there is no formal right to advise pursuant to the WOR. Recently, the Enterprise Section of the Court of Appeal in Amsterdam rendered a judgment in a case on this topic in which the director subsequently (partially) went back on his decision to reorganize.

The Facts

As a consequence of cutbacks on subsidies, the director of a network organization was forced to take measures of a reorganizational nature. The first phase of the reorganization took place in the period from 1 January 2012 to 1 April 2012. The second phase, which will take place in 2013, was presented to the Works Council for its advice. The Works Council had some objections to the projected decision, but in the end it gave a positive advice. Part of this second phase is the redundancy of the position of secretary of the Supervisory Board. In the course of the reorganization, however, the director went back on a number of points. For instance, the director deemed a partial preservation of the position of the secretary desirable, because in the past six months certain elements of this position had become more important. The director requested the advice of the Works Council on this adjustment. The Works Council gave a positive advice on many aspects of the adjustment, with the exception of the intention to preserve the secretary’s position. The director nevertheless decided to carry out the projected decision, whereupon the Works Council went to court.

Judment of the Court of Appeal of Amsterdam

The Enterprise Section argued first and foremost that since the director requested the advice of the Works Council, the Works Council has the right to advise. Therefore, the director cannot take the position that there is no right to advise pursuant to the WOR. The director also argued, inter alia, that on second thought he had underestimated the consequences of the narrowing down of the top and that the transfer of the secretary´s task had appeared troublesome. The Enterprise Section deemed this argument not to be implausible. Therefore, it cannot be argued that the director could not take the decision in all reasonableness. The fact that partially going back on an earlier decision means that the initially intended cutbacks cannot be reached in their entirety, does not alter this. Thus, the request of the Works Council was rejected.

Tips

  • In the event of projected decisions it is advisable to examine thoroughly beforehand whether the Works Council has a right to advise. Once the Works Council has been requested to give an advice, it will get all the accompanying powers and this cannot be reversed.
  • As the above judgment shows, it is possible to (partially) go back on an earlier decision. In that case the director must go through the advice procedure of Section 25 of the WOR again.