When companies are preparing for extensive restructuring, the works council plays a key role: It is the main point of contact for balancing interests and social plans and is therefore an integral part of the social compensation mechanism. However, things get interesting in situations where there has been no works council to date and one is only being established after the decision to change operations has already been made internally or even communicated. A recent ruling has once again brought this constellation to light – and shows how complex the timing of co-determination rights can be.

When do participation rights arise?

Co-determination rights in the event of operational changes require that a works council exists at a point in time when it can actually still influence the employer's decision-making process. The decisive factor is therefore not an abstract phase in the process, but the question of whether the business decision is still negotiable.

Case law generally assumes that:

• As long as the employer is still in the planning phase, decisions are typically not final, and the works council can use its scope for action.
• The right to a reconciliation of interests and a social plan does not arise only when individual measures are implemented, but already at the moment when the planned operational change is finalised – and this is precisely where the complex distinction begins.

Until now, it has been disputed whether the relevant point in time ends with the completion...

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