No works council in start-ups: These are the risks for employees

When the works council elections begin in Germany these days, employees choose who should represent their interests in front of the executive floor.

Although the committee is possible for a workforce of five people or more, there are many companies without a works council – start-ups in particular often do not have such a place for operational co-determination.

The works council is not only rejected by the executive floor

Not only does management often feel threatened by a possible works council, but employees in start-ups often see no benefit in the body, unionists report. “Many in the company think: We don’t need something like that, it doesn’t fit into our culture, that makes us slow,” says Verdi secretary Oliver Hauser.

In addition, there is often a high level of fluctuation in young companies, especially in the tech sector. Thoughts like “I don’t work here for long anyway” or “If I don’t like it, I’ll just go somewhere else” are not uncommon, especially among qualified specialists. Unlike easily replaceable workers, they often see no urgency for a works council. “Most of the time, people only get in touch when there are already serious problems and it’s actually too late,” says Hauser.

Foundations often come too late

In the early stages there is often strong internal communication in start-ups, says Jörg Weingarten from the German Trade Union Confederation (DGB). Because many founders get to know each other at university, everything is initially friendly and easygoing. “When the company then grows, the old structures from the start-up phase suddenly no longer work.” It is therefore important to establish legally secured rights and binding communication channels with a works council. “If, for example, the sale to an investor is pending, then the initial feeling of flat hierarchies and supposed codetermination is quickly lost,” explains Weingarten.

It is often a major task to make employees aware of how useful it can be to set up a works council and get help from a trade union. In the academic environment in particular, many employees are certain that they don’t need a union to assert their interests, says Weingarten. “You learn at university that you can take care of yourself and that you can speak to people on an equal footing thanks to a high level of education.”

Less qualified workers often do not have this level of self-confidence. Weingarten also observes a great deal of ignorance among students about the political participation and creative power of trade unions. “Many have the image in their heads that trade unionists are only those with safety vests and whistle in hand.”

Young graduates require a new offer

In addition, young graduates are less accessible to typical works council and trade union issues such as the regulation of working hours. “We’re not picking up people with an academic education who identify strongly with their projects,” says Weingarten. This target group must therefore be reached with good collective agreements and with trade union training opportunities.

The situation is different for low-skilled and easily replaceable work. It tends to be more difficult for such workers to set up a works council because the company can more easily replace them and threaten to fire them.

The European Commission is trying to counteract this

With newer platform business models such as delivery services, networking among employees is also complicated, says Karin Vladimirov from the Food, Enjoyment and Restaurants Union (NGG). “The employees hardly meet and know each other, so it’s more difficult to get together and set up a works council.” The European Commission wants to change that and presented regulatory proposals for the platform economy in December last year. A possible guideline should oblige employers to enable communication between employees, but also with their interest groups.

The SPD member of parliament and former founder Verena Hubertz knows from her own experience that a works council often does not make it onto the agenda at the beginning. “Especially in the initial phase, many capacities concentrate on the development of the core business.” Hubertz explains that it is difficult for both employees and employers to plan and implement the topic of establishing a works council in a very dynamic environment.

The SPD politician sees the start-up industry – apart from “a few black sheep” – as generally open to works councils. Ultimately, such a body is also in the interests of the young company. “Participation is a win, both for employees and for the start-ups themselves.”