The revised European Works Council Directive: What multinational employers need to know

At a glance

• On 9 October 2025 the European Parliament voted to adopt the revised European Works Council Directive (Directive).
• The Directive makes extensive changes to nearly every aspect of how European Works Councils (EWCs) are established and operate, with wide-reaching implications for all multinational businesses.
• Member States will have until 2027 to implement the new Directive, with most of the changes expected to take effect in 2028.

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The current EWC Directive establishes procedures for setting up EWCs and for informing and consulting them on 'transnational' matters, including certain cross-border mergers and acquisitions, outsourcing, restructuring, and redundancies. The new Directive introduces several changes:

• Extending rights for workers and EWCs.
• Increasing employer obligations, such as funding EWC experts, covering legal fees, training, and related expenses.
• Broadening management’s responsibilities regarding the provision of information and consultation with EWCs.
• Information can only be required to be withheld or treated as confidential if objective criteria are satisfied and for as long as the reasons justifying these limitations persist.
• Revoking the exemption status of 'legacy' EWCs.
• Enhanced sanctions for non-compliance.

Member States will have until 2027 to implement the new Directive. Most of the changes are expected to take effect in 2028, though exact dates are yet to be confirmed. 

The changes will affect employers with an existing EWC and those who do not currently have one but are in scope ie businesses with at least 1,000 employees within the EU or European Economic Area and at least 150 employees in each of two countries. 

Revoking the exempt status of legacy EWCs

The Directive’s key provisions include ending Article 13 status and Article 3 status, under which many multinational businesses have been exempt from national laws on European Works Councils since the EWC Directive came into force in 1996 (or 1999 in the case of Article 3). 

When the Directive comes into force, a business with 'Article 13' or 'Article 3' status can be required to establish an EWC, irrespective of its existing arrangements. 

For in-scope businesses headquartered outside of a Member State, it is advisable to designate a representative agent within a Member State of their choosing for EWC purposes. In the absence of such an appointment, the business’s obligations, following any valid request, will be governed by the national laws of the Member State where the group company employing the largest number of employees in any single Member State is located at the time of the request.

When EWC consultation is triggered

EWCs are entitled to be consulted on 'transnational' matters. The Directive broadens the concept of a transnational matter; a matter will be considered to be ‘transnational’ when measures considered by a business:

• can reasonably be expected to affect workers in more than one Member State; or
• can reasonably be expected to affect workers in one Member State and workers in another Member State can reasonably be expected to be affected by the consequences of those measures.

A business will need to respond to any opinion from its EWC on its proposals before deciding on them. For these purposes, an EWC must provide any opinion within a reasonable time of the consultation meeting, having regard to the urgency of the matter. 

Requests to establish an EWC

The Directive removes the requirement for employees and their representatives to submit a coordinated request to establish an EWC. Under the Directive, businesses will be obliged to set up an EWC once the threshold of 100 employees or their representatives in at least two Member States has been reached, even if the requests are made separately. 

Operation of Special Negotiating Bodies (SNBs)

The Directive requires a business to convene the first meeting of a SNB within six months of receiving a request to set up an EWC. If it fails to convene such a meeting, then subsidiary requirements governing its operation of its EWC will apply to it, irrespective of whether it has expressly refused to commence negotiations. 

The Directive requires a business to convene a ‘sufficient number’ of negotiation meetings with its SNB to reach an EWC agreement. 

The Directive also requires SNBs to be entitled to be assisted at a business’s expense by legal experts, provided that their expenses have been notified to the business in advance. 

Gender balance 

When forming EWCs, parties must aim for at least 40% representation for each gender. However, this is an objective not a requirement. 

Subsidiary requirements

The Directive amends the subsidiary requirements that apply if the business fails to conclude a negotiated EWC agreement, as follows:

• The EWC’s remit will be expanded to cover skills and training processes, and the anticipation of change and management of restructuring processes, including those linked to green and digital transitions.
• The EWC will be entitled to meet with the business twice a year in person, with these regular meetings only able to be held virtually in exceptional cases and with the EWC’s consent.
• The EWC will be entitled to be accompanied by its experts at meetings between the EWC and the business, so long as the EWC has informed the business of their attendance in advance.
• The reasonable costs of legal experts must now be met by the business as part of an EWC’s operating expenses, provided that these are notified in advance.

EWC costs

Expenses relating to negotiating an EWC, including reasonable costs for experts, must be borne by the business. The EWC agreement must clarify funding for the EWC’s use of experts and trade union advisors and for training. Reasonable training costs and expenses must be funded as well as the funding of reasonable legal and associated costs if the EWC enforces its rights.

Increased sanctions

The revised Directive requires Member States to ensure that EWCs can enforce their rights, by providing timely and effective procedures and remedies. Penalties should take into consideration the gravity, duration, consequences and the intentional or negligent nature of the offence. Member States must also provide for financial penalties for breach of information and consultation duties, which should additionally consider annual turnover. A proposal to introduce a mandatory financial penalty, similar in scale to financial penalties under the GDPR, was not included in the final Directive. However, employers will face increased EWC enforcement risks, including financial penalties, in some Member States.

Next steps

The Directive still needs to be adopted by the Council before the transposition period is triggered. 

Businesses with EWCs should review their existing arrangements considering the forthcoming changes. Those with legacy agreements that will lose their exemptions should assess the likelihood of renegotiation requests from employee representatives. It will be crucial for businesses to monitor the transposition process in relevant EU member states to understand specific national compliance requirements.