Restructuring of the Automotive Industry: The Role of EWCs

Publication Type:

Conference Paper


Gerpisa colloquium, non, Berlin (2010)


european labour relations, restructuring, works councils


The case of General Motors most drastically illustrates the dilemma which the automobile industry and its employee representatives are facing in the current crisis: How can restructuring and downsizing processes be managed by safeguarding a balanced distribution of losses and benefits among European plants and employees? As cross-border institutions, European Works Councils (EWCs) can play a decisive role in those intra-company interest regulation processes.
By now, there is a substantial number of studies dealing with different aspects of EWCs. Previous research has often dealt with the potential of EWCs to influence management decisions and to participate in joint negotiations. As previous research has pointed out, EWCs vary extremely regarding their activities and their ability to effectively influence company decisions. While some EWCs operate on a low level (as simple ‘tools’ for the distribution of selected information), others play an important role in the overall communication and interest regulation of the company at European level. Especially in the automotive sector, some EWCs have developed astonishing competencies regarding the ability participate in company decision making processes. Some EWCs, for instance at GM or Ford, are engaged negotiations with management, thereby clearly exceeding the provisions of the EWC Directive.

The paper pursues the question under which conditions EWCs can develop into effective tools for both employees, national interest representatives, and management for dealing with restructuring processes in the automobile industry. The aim of the paper is to examine the role of EWCs as institutions and actors of cross-border interest regulation and to clarify, under which conditions EWCs become a relevant actor and in which way they can stabilize production and employment in automotive companies.

Based on a concept and typology of international (profit and non-profit) organizations, the paper analyses the conditions and factors which influence the development of EWCs of selected OEMs with manufacturing operations in Europe.[1] Empirical evidence shows that differences in the company structure, the institutional settings of the ‘home country’ as well as actor strategies and path dependencies explain EWC characteristics and its effectiveness in restructuring processes.

[1]          The data presented origins from the research project “The European Works Council – A Transnational Organisation?”, funded by the German Research Foundation (Deutsche Forschungsgemeinschaft, DFG) which is carried out at the Ruhr-Universität Bochum, Chair Sociology/Organisation, Migration, Participation (Prof. Dr. Ludger Pries) (3/2007-6/2010).

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