German Federal Labour Court (BAG) as of 08 March 2022 – 1 ABR 20/21

The BAG strengthens the competence of the general works council for the introduction and use of technical facilities in the case of uniform company administration and data storage (e.g. Microsoft Office 365).

Summary of Facts

The employer intended to introduce and use Microsoft's Office 365 software package in all its offices. The use of the software was to be in the form of a single-tenant solution. For this, it was planned that the entire company for electronic data processing would be managed as a uniform client (tenant) with a central administration, and data created and collected during use would be stored in a uniform cloud. The general works council agreed to the company-wide use of the software package. A local works council, however, considered the general works council to be incompetent and requested that its own competence be established for parts of the software package.

Decision

The BAG strengthens the competence of the general works council and states - as did the Cologne Regional Labour Court before - that the general works council is responsible for exercising the right of co-determination pursuant to Section 87 (1) no. 6 of the Works Constitution Act (Betriebsverfassungsgesetz - BetrVG) in the case of the company-wide introduction and use of Microsoft Office 365. The Office 365 software package is a technical device within the meaning of Section 87 (1) no. 6 BetrVG. When using the desktop applications and the individual services of the software package, data is generat-ed or collected that can be used to monitor the performance and behaviour of employees. In the opinion of the BAG, the uniform company administration of the software with centrally assigned administration rights enables centralised control of the behaviour and performance of employees in all company establishments. For compelling technical reasons, this central monitoring option requires an inter-company regulation. It is irrele-vant that user-specific settings can be made for individual modules or that company-specific regulations can be made for the use of individual modules. The principle of separation of competences requires the exclusive competence of the general works council.

Consequences in practice

The BAG's decision is appreciated. It strengthens the primary competence of the general works councils and group works councils with regard to the introduction and use of software packages at company or group level. As a general rule, local works councils are primarily responsible for exercising co-determination rights under works constitution law. If, however, matters affect several establishments or the company as a whole and regulations must be made on a compulsory basis for all establishments, the general works council has the primary responsibility for exercising co-determination rights. This also applies accordingly to the primary competence of the group works council. The thresholds for a primary competence of the general or group works council are high. Negotiations and the conclusion of agreements with these bodies therefore regularly require delega-tions from the local works councils. The BAG also emphasises the principle of separation of competences, according to which the regulation of a matter is either the exclusive responsibility of the individual works councils, the general works council or the group works council. This creates legal certainty that even with regard to individual modules of a software package, negotiations do not have to be conducted with several bodies at different levels. This means that there is no need to negotiate with several local works councils, but one body is responsible for the whole company or group.

Practical advice

The decision shows once again that by designing the framework conditions of technical facilities, especially with regard to administration rights, storage options and control powers, influence can be exerted on the body responsible for negotiations. Decisions of employers to create uniform technical framework conditions are respected by the BAG even if it would be technically possible to create them individually for each establishment. These design options should therefore be considered in advance with regard to the body to be involved and used if necessary. Framework (general) company agreements that provide framework regulations for further modules or updates required at a later date are also a useful variant to simplify negotiations on the introduction and use of technical facilities, such as complex software packages.