An earlier article sets out what belongs in the document required by section 92 BetrVG and that failing to provide it is an administrative offence under section 121 BetrVG. The addressee there is the works council. There is a second addressee, with its own threshold, its own duty of information and the same fine, and it is missing from most project plans because it is not called "works council".
Who has to have one
Section 106 subsection 1 sentence 1 BetrVG reads: in all companies with, as a rule, more than one hundred permanently employed employees, an economic committee ("Wirtschaftsausschuss") is to be formed. Sentence 2 gives it two tasks: to discuss economic matters with the entrepreneur and to inform the works council.
The threshold is worth a second look once it is placed next to the other thresholds that matter in this field. It counts differently from most of them.
| Provision | Threshold | Measured at | What depends on it |
|---|---|---|---|
| Section 99 (1) | more than 20 employees entitled to vote | company | works council consent to hiring, grading, regrading, transfer |
| Section 111 sentence 1 | more than 20 employees entitled to vote | company | information and consultation on operational changes |
| Section 92a (2) | more than 100 employees | establishment | written reasons if works council proposals are rejected |
| Section 106 (1) | more than 100 permanently employed employees | company | an economic committee is to be formed |
| Section 111 sentence 2 | more than 300 employees | company | an adviser for the works council in operational changes, without a necessity test |
| Section 95 (2) | more than 500 employees | establishment | works council may demand selection guidelines |
Four different measures in six rows: employees entitled to vote, employees, permanently employed employees, and in each case either establishment or company. A company with three establishments of 60 employees each has no establishment in which section 92a requires written reasons, and still has to form an economic committee. For the customers this website is built for, the question is purely arithmetical: at 500 employees and more, all six thresholds are exceeded. The table still matters, because it shows that the provisions do not ask the same question and therefore do not have the same answer.
What is owed to it
Section 106 subsection 2 sentence 1 reads, in substance: the entrepreneur must inform the economic committee in good time and comprehensively about the economic affairs of the company, submitting the necessary documents, insofar as this does not endanger the company's trade and business secrets, and must set out the resulting effects on workforce planning.
The three words from section 92 return here: in good time, comprehensively, documents. What is new is the final clause. The entrepreneur has not only to present the economic matter but to set out its effects on workforce planning. For a plant conversion that means: the subject is not the investment alone but the investment together with the question of which activities it changes, how many employees that affects and what vocational training follows from it. That is the same question the section 92 document answers, addressed to a different body.
And the reservation for trade and business secrets is not an exception to the duty but a limit within the document. It allows individual details to be withheld where they would endanger the company. It does not allow the information as a whole to be suspended.
Why a plant conversion appears three times in the list
Section 106 subsection 3 lists what "in particular" counts as economic affairs. A conversion to new drivetrains and automated testing does not fall under one of these items but under several at once:
- Number 3, the production and investment programme, because new equipment is being procured.
- Number 5, production and working methods, "in particular the introduction of new working methods", because the work on the line is changing.
- Number 9, the change of the organisation or purpose of the establishment, insofar as units are being recut.
Number 4 names rationalisation projects alongside, and number 10 catches "other processes and projects which may substantially affect the interests of the company's employees". So there is no need to decide which number fits. It is enough that one fits, and for an initiative of this kind three do.
One observation, because summaries tend to get it wrong: artificial intelligence does not appear in section 106. Number 5b concerns corporate due diligence obligations in supply chains. The three places where the Works Constitution Act names artificial intelligence are section 80 subsection 3, section 90 subsection 1 number 3 and section 95 subsection 2a, as described in an earlier article. An AI-supported system in production reaches the economic committee not as AI but as a new working method under number 5.
How the body works, and what that means for timing
Under section 107 subsection 1, the economic committee consists of at least three and at most seven members, who must belong to the company, including at least one works council member. The works council appoints the members; where there is a central works council, that body does. Under section 107 subsection 3 the works council may also assign the tasks to a committee of its own; the duties under section 106 remain the same.
Section 108 subsection 1 says the economic committee shall meet once a month. Under subsection 2 the entrepreneur or a representative must attend, and may bring in knowledgeable employees; for experts, section 80 subsections 3 and 4 apply accordingly. Under subsection 3, the members are entitled to inspect the documents to be submitted under section 106 subsection 2. And under subsection 4, the economic committee must report to the works council on every meeting without delay and in full.
From these three subsections follows a timing constraint that a project plan should reflect. First, there is a meeting rhythm, and "in good time" is measured against it too: an initiative that the board resolves in the third week could have been dealt with at the meeting in the first. Second, inspecting the documents is a right of the members, not a courtesy; a presentation that is shown and collected again is not a submission. Third, everything the economic committee learns goes to the works council without delay and in full. What you tell one body, both know.
The fine
Section 121 subsection 1 BetrVG makes it an administrative offence to fulfil one of the listed duties of disclosure or information "not at all, untruthfully, incompletely or late". Section 106 subsection 2 is on that list, next to section 92 subsection 1 sentence 1, section 99 subsection 1, section 111 and others. The range under subsection 2 is up to ten thousand euros.
Of the amount it has been said elsewhere that it is not the point. Here it is worth looking at the four forms of breach. "Late" is there in so many words. A notification that is complete in substance but arrives after the decision is one of the four ways the duty is breached.
What follows for the document
A plant conversion therefore has two addressees with two duties of information, both requiring "in good time, comprehensively, on the basis of documents", both backed by a fine. The economic committee receives the economic matter together with its effects on workforce planning. The works council receives workforce planning together with the vocational training measures. The intersection of the two is the account of which units are affected, how many employees work there in which roles, how their work changes and what training need follows.
From that follows a plain requirement: both documents must come from the same data set. If the economic committee hears one headcount and the works council another, that is not only embarrassing but, under section 108 subsection 4, immediately known, because the committee reports to the works council in full. Whoever keeps the role overview properly once and draws both documents from it does not have this problem. Whoever builds a separate version for each body certainly does.
What is not here
This article is not legal advice. It reproduces the wording of sections 106, 107, 108 and 121 BetrVG and places the thresholds of several provisions side by side. What counts as a trade or business secret in a given case, how "in good time" is to be measured in a specific initiative, and how the duties are distributed in group structures and with central works councils is for those who run the procedure in-house.
Sources
- Section 106 Betriebsverfassungsgesetz, economic committee.
- Section 107 Betriebsverfassungsgesetz, appointment and composition of the economic committee.
- Section 108 Betriebsverfassungsgesetz, meetings.
- Section 121 Betriebsverfassungsgesetz, administrative fines.
- Section 92a subsection 2, section 95 subsection 2, section 99 subsection 1 and section 111 sentences 1 and 2 Betriebsverfassungsgesetz, for the comparison of thresholds.