EWC statement – To all employees, work councils and other employee representing groups 20 December 2013
Negotiations on an improved EWC agreement failed; EWC will cease to exist after 24 January 2014.
The HP European Work Council (EWC), representing the HP workforce of all countries in the EEA, Switzerland and Turkey, met with HP EMEA management December 19th 2013 in Amsterdam in its second annual plenary EWC meeting.
The EWC proposed to prolong the negotiations until January 24th 2014: negotiations to be based upon a new EWC agreement that the EWC proposed. No agreement on the proposal from EWC to prolong was reached during the meeting.
The EWC terminated its current agreement, after a long lasting, unresolved dispute, on July 24 2012. That agreement has, in total, an 18 month post-termination notice period, which means it is still in effect until January 24th 2014.
The EWC will cease to exist after January 24th 2014 and that means that HP employees will not be represented anymore by a European level employee forum.
The HP EWC was founded in May 1996, just ahead of formal implementation of European legislation on European Work Councils (directive 1994/45/EC).
The obligations of both parties were laid down is an agreement (contract); the “EWC agreement”. Since the agreement was established before any ratified EU legislation, the HP EWC was not able to make use or inherit rights that have become part of the EU directive on European Work Councils.
The HP EWC agreement prevented the EWC to perform its duties to represent the employees to the full extent. The EWC stated multiple times over the years to HP management that it could not fulfill its consultation rights because of insufficient information provided by the company in case of transnational changes.
In November 2011 the EWC requested HP management to start voluntary negotiations to transform the old agreement into a directive-based agreement. HP management did not wish to do so, citing that the old agreement was fit for purpose and that there was no legal obligation to change it.
After the announcement in March 2012 that HP would enter a period of massive restructuring, the EWC asked to be properly informed so that EWC could prepare for consultation on any of the proposed changes. The EWC also asked for the support of external experts to help them understand and assess the proposed changes. HP management rejected the request for the EWC’s selected experts.
The EWC would not accept this and decided to do two things:
1. Ask for a ruling in Belgium court on the fact that EWC was not properly informed and could not consult. And that EWC had the right to be supported by experts of their choice. Also EWC asked for suspension of the implementation of the proposed changes until the court’s ruling.
2. To terminate (cancel) the old EWC agreement to open a route to a new EWC agreement under the recast EU directive (2009/38/EC) for EWCs.
On December 18, 2012 an agreement was signed with HP management to stop the court case and then negotiate for 12 months to try to reach a new EWC agreement under the new directive and its transposition (implementation) in UK law. December 1st 2013 was outlined as a checkpoint date to see if the negotiations were successful (or the parties were close enough such that negotiations could continue). If the negotiations would fail both parties were allowed to progress on their own.
The EWC assembled a negotiation team, the EWC Negotiation Committee (ENC) to work together with HP management to try to come to an agreement. The ENC team also had the constant support of two external experts.
The negotiations were very difficult because there was a major difference in the interpretation of how the transposed directive in UK law would operate. To progress the negotiations the ENC team adjusted a management proposal of November 27th 2013 such that it fully reflected the EU directive with regard to the rights of an EWC.
This led to a final proposal on December 13th 2013 from HP management which completely ignored the wishes of the EWC and the EU directive. The proposition is well below the minimal rights laid down in the UK law, and contains even less rights than the old, terminated, agreement! This was not acceptable for the EWC.
EWC proposed to continue the negotiations using EWCs draft (directive-based) proposal until January 24th 2014. HP management did not accept that offer and that concludes the negotiation attempt.
As of January 24th 2014 HP, the first company in Europe who had an existing EWC, will not have a European Works Council anymore.
HP has still a legal obligation to establish a European Works Council. The process on how to establish a EWC is laid in the European directive 2009/38/EC.
In short the process:
1. Two or more countries with more than 100 employees can send a request to local country management to request to establishment of a EWC.
2. Upon the reception of the two requests, HP must assign a so-called “representing agent”.
3. HP has to assemble a Special Negotiation Body (SNB) which will be composed by employees out of each of EEA (European Economic Area) countries. How many representatives each countries will get is laid out in the directive.
Failure to establish a SNB within 6 months after the reception of minimal 2 requests, a EWC will be established under minimal law arrangement (the “Subsidiary Requirements”)
4. If a SNB is established, it can start negotiations with HP central management to try come to a new EWC agreement. This process can take up to 3 years and central management is not obliged to negotiate. In case of failure a EWC will be established after the 3 year period under minimal law arrangement (Subsidiary Requirements)
This means that HP may not have a EWC for the next 3.5 years.
Over the past years EWC felt that the EWC agreement of 2002 did not enable an effective process of information and consultation with the European employee representatives:
• Since the merger between HP and EDS in 2008 bi-annual, 2 day meetings were too short to discuss issues in detail, form an opinion, and provide feedback to management;
• HP management did not enable the EWC to understand and evaluate HP’s plans because they did not:
• allow consulting experts selected by EWC to attend EWC meetings,
• allow to meet with EWC -selected experts even at a pre-meeting, and without costs for HP
• HP management did not provide detailed information (e.g. country figures) of major reorganisation plans.
In 2009 a new EU directive set a standard of significantly better conditions for an effective information and consultation.
EWC therefore started a dialogue with HP management to get the new standard, but without success.
EWC therefore decided to terminate the current EWC agreement and to start negotiations about a new agreement. Although HP management had agreed to base these negotiations on the 2009 EU directive as implemented in UK law, all HP proposals so far have been significantly below this standard.
In its December 2013 meeting EWC decided unanimously the best way to continue was to negotiate based on the ENC proposal of November 27th until January 24th 2014, but management considered this to be too far from their own proposal to continue negotiations.
Therefore after January 24th, 2014 the process must be launched to establish a “Special Negotiation Body”, which will negotiate a new EWC agreement based on the standard defined by UK law.
EWC is hoping HP will soon enter in constructive negotiations leading to an agreement enabling effective information and consultation of the European employee representatives.
On behalf on EWC,
Chair of the EWC