Vredling Directive

Summary of Vredling Directive

Unsuccessful proposed legislation of the European Economic Community (EEC) which would establish the right of workers to be informed of major policy decisions by corporate management. The directive was formulated in 1979 by Henk Vredling, who was EEC commissioner for employment and social affairs at the time. The draft directive, which awaits final approval, would require management of firms employing at least 1,000 workers to inform employees of major changes in corporate structure, financial condition of the firm, business trends and projections, investment opportunities, and employment prospects. Such information would be provided by management each year on a prescribed day. In addition, management would be obliged to consult with employees in advance of actions which would have a major impact upon the firm. Employees would be granted 30 days to reply. Specifically included as areas for mandatory consultation are: proposed closure of plants or transfer of significant portions of the productive capacity thereof; contraction of the firm; workers’ safety and health; and major organization changes.

The Vredling Directive has been accepted in principle by most EEC member states, with the notable exception of Great Britain. The measure has been attacked, within and outside the EEC, as an unwarranted infringement upon management prerogatives; additionally, concern has been expressed that the consultation process would expose trade secrets and other confidential business information. For example, management would be obliged to furnish employee representatives with data supplied to shareholders or creditors.

The directive would apply to both EEC-based companies and foreign firms doing business in the EEC.

The Vredling Directive should not be confused with Codetermination (read this and related legal terms for further details), or other forms of worker participation in management of the firm.

The Vredling directive focussed on the inequalities in the information and consultation provisions available to workers

(Main Author: William J. Miller)