BDA AGENDA 08/21

The participation of employees and their representatives - both in the works constitution and in co-determination on the supervisory board - is a defining element of economic and industrial relations. Where works councils and employers work together in a spirit of trust, where employee representatives act for the good of the company, co-determination and works constitution can prove their worth, as in the economic and financial crisis or the current health crisis.

However, participation in the supervisory board - at least in its concrete form in companies with more than 2,000 employees and especially in the coal and steel sector - has remained a special path. The coal and steel co-determination introduced 70 years ago can only be explained by the exceptional historical situation after the Second World War. It is also the result of the threat of dismantling a key industry that was particularly important at the time. If the supervisory board was unable to reach a consensus on individual issues, a "neutral" third party would then decide.

This co-determination in the coal and steel industry is not an example of the participation of employee representatives on supervisory boards being extended to all larger companies. On the contrary, it could weaken the compatibility of the system of participation in the supervisory board on the international and European stage. The acceptance of German co-determination would be limited. The second voting right of the chairman of the supervisory board under the Co-Determination Act is constitutive for the compatibility of the Act with the Constitution.

The future of co-determination on supervisory boards lies in solutions that strengthen the ability of our companies to cooperate, accepting co-determination in Germany as a starting point as well as the forms of participation in other countries. This would be ensured by a solution based on negotiation. European law shows that such negotiated solutions promise success. After many years of dispute, a solution acceptable to all partner states has been reached for the first time with the European Company. It is important to continue along this path - also for national law.

A successful model can only benefit from strengthening the negotiating scope of the negotiating partners in the company. As long as the necessary self-confidence of the social partners is lacking and consensus is difficult to achieve, reform steps should be launched which could be implemented quickly. The time-consuming and costly election of delegates in large co-determined companies should be abolished. Direct election not only saves costs - sometimes running into millions - for the election procedure, but can also increase the legitimacy of the directly elected employee representatives on the supervisory board. Elections of employee representatives to the supervisory board should be made possible electronically - not only with a view to the pandemic situation but also for the general implementation of digitalisation opportunities.