Works council - in the Netherlands

What is a works council under Dutch labour law?

Under employment law in the Netherlands, a works council (in Dutch: ondernemingsraad) is a support structure within a business that is built to protect and promote an employee’s position in the company. Under Dutch law, such a body’s existence can be a strict requirement in a business depending on the number of current employees. As a foreign worker or entrepreneur in the Netherlands, it is important to be aware of the legal necessities of safeguarding employee’s rights and their participation, which is rooted in this requirement.

When is a works council legally required in the Netherlands?

If your business employs at least 50 workers, then you must formulate a works council under the Work Councils Act. If you have more than a single branch, you will need additional work councils in each of the subsequent offices that exceed this 50 employees threshold. However, a joint works council can be created if the branches employ more than 50 people collectively but less than 50 individuals.

A company that employs less than 50 people is under no obligation to form a works council. Instead, a voluntary council can be formed by the employees, or a representative body (in Dutch: personeelsvertegenwoordiging, PVT) can be created. This type of body would not hold the same powers as a legally implemented works council nor would it entail the same obligations. The employees can still exercise rights to consolation, which must be accomplished by holding staff meetings.

What rights exist in a works council in the Netherlands?

The works council acts to ensure employee participation in both the daily operation of a company and the decision making for the company’s future direction. The purpose of such a council is to benefit both the employer and employees, through both representation in the workplace and having a forum in which constructive feedback can allow the business to progress. In the Netherlands, the works council must be convened at least twice a year and take place within working hours. Under labour law in the Netherlands, the members of the works council are also entitled to schedule their meetings within working hours.

The works council rights and interests are solely intended to protect employees in the working environment. Mainly, these are:

1. the right to be consulted when a decision is proposed that will substantially affect the company
2. the right of consent concerning substantial changes in the terms of an employment agreement
3. and the right to render advice on matters dealt with in the meetings.

The topics up for discussion are generally limited to those on which the employees have the competency to render advice. Further, the issues discussed are expected to be events anticipated within a sixth month period.

The rights of the work council in carrying out the objectives set at such meetings include working time available for training and consultation for the remaining colleagues. The Works Council Act imposes an annual minimum of five days for the training and sixty hours for consultation.