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Towards a Legal Framework for Transnational Company Agreements Presentation of the Report to the ETUC By Silvana Sciarra, Maximilian Fuchs and André Sobczak Lisbon, 9 September 2012 Agenda 1.Introduction to Transnational Company Agreements 2.Literature Review 3.Empirical Study 4.Draft Proposal for an Optional Legal Framework 5.Discussion 2 1. Introduction to Transnational Company Agreements Introduction to TCAs More than 230 TCAs, mainly in companies having their seat in EU Member States TCAs are negotiated in the absence of a specific legal framework Questions about the legal status of TCAs and the consequences of a non-respect 4 Introduction to TCAs Content of TCAs Fundamental social rights Corporate social responsibility Equal opportunities Training Restructuring … 5 Introduction to TCAs Scope of application of TCAs Application to the subsidiaries How to define subsidiaries? What happens if the scope of the group changes? Information to suppliers and subcontractors How far going down the supply chain? What happens in case of non respect? 6 Introduction to TCAs Signatory parties on employer’ side TCAs signed by the group’s (European) headquarters Headquarters are not the employers of the workers in the subsidiaries Headquarters are not legally liable for the non respect of labour law standards by subsidiaries 7 Introduction to TCAs Signatory parties on workers’ side European (or Global) union federations European Works Councils National unions 8 2. Analysis of EU Policy Documents EU Policy documents Usefulness of an optional legal framework European Commission’s Social Agenda 2005-2010 European Parliament Resolution 2005 European Economic and Social Committee 2005 European Commission’s Staff Document 2008 Actors involved in negotiations Legal effect Dispute settlement 10 EU Policy documents European Commission’s Staff Document 2012 Identifying the actors involved in TCAs and clarifying their roles Promoting transparency of TCAs Implementation of TCAs Improving legal certainty with regards to the effects of TCAs Prevention and settlement of disputes 11 EU Policy documents European Parliament Resolution 2013 Legal framework has to be optional TCAs shall be negotiated and concluded only by representative European trade union federations Insertion of most favourable clauses and nonregression clauses have to be inserted into TCAs Introduction of alternative dispute settlement procedures 12 3. Lessons from interviews with actors involved in TCAs Lessons from interviews Motivations of social partners Long tradition of social dialogue at the level of the headquarters Good experience of social dialogue at the European level, mainly in the EWC Trust is the key condition for the negotiation of a TCA Using social dialogue to strengthen the company’s culture and the workers’ commitment 14 Lessons from interviews Negotiation process Great diversity in the negotiation process as well as in the actors involved Some interviewees ask for a legal framework; others appreciate the current freedom Local managers are not always informed about the negotiation of a TCA Negotiation with European union federations seen as more efficient than with national unions 15 Lessons from interviews Implementation of TCAs Different national traditions or legislations may create problems for implementation Lack of a legal framework pushes to the definition of specific implementation and monitoring procedures TCAs aim at stimulating social dialogue at the level of the subsidiaries Importance to take into consideration that the economic context may change 16 Lessons from interviews Dispute Settlement Few conflicts between the signatories of TCAs Signatory companies do their best to respect the commitments External dispute settlement mechanism seen as an interesting opportunity 17 4. Draft Proposal for an Optional Legal Framework Draft Proposal Legal Basis Art. 155 TEU: “Should management and labour so desire, the dialogue between them at Union level may lead to contractual relations, including agreements.” 19 Draft Proposal Council Decision Art. 155 TEU: “Agreements concluded at Union level shall be implemented either in accordance with the procedures and practices specific to management and labour and the Member States or, in matters covered by Article 153, at the joint request of the signatory parties, by a Council decision on a proposal from the Commission.” 20 Draft Proposal Conditions to access the Optional Legal Framework Signatory parties Legal representative of the headquarters At least one European union federation or two national unions Disclosure of the mandate to negotiate Rules to operate the mandate are left to the social partners Definition of the scope of application Opt-In clause 21 Draft Proposal Conditions to access the Optional Legal Framework Most favourable clause Non-regression clause Internal dispute settlement Date and venue of the signature Expiry date and rules to promote renewal Duty to notify the TCA and the subsequent amendments to the EU Commission 22 Draft Proposal External Dispute Settlement Development of an external dispute settlement mechanism based on national experiences Access limited to the signatory parties of the TCA Mediators to be chosen by the signatory parties EU Commission may establish a list of potential mediators among legal experts and staff members 23 Thank you for your attention! André Sobczak [email protected]