INTERNATIONAL RELATIONS
Vol.34-No.06 June 1,1995
Honda Launches First Works Council in Europe
In response to a directive from the European Union(EU), Honda Motors has established a works council for its facilities there. At a regular annual meeting, the corporation will tell representatives of workers in its European plants about its management policy and will make a preliminary report on important decisions, such as any closure of its European facilities.
Some analysts believe that the European Works Council(EWC), to be launched by 1999 at latest, will prevent businesses from restructuring themselves. Honda, however, concluded that establishing the EWC will help it localize its projects and decided that it will be the first Japanese business to introduce the EWC. Honda's adoption of the EWC is also characterized by the fact that it has organized employees of the countries which are not subject to the EU directive. Toyota Motor, Sony and Toshiba are also planning to do the same and are likely to follow in the footsteps of Honda.
It was decided by an EU unified directive of September 1994 that the EWC be established. In the EU region, other than Britain which has declined to participate in the social policy agreement of the Maastricht Treaty, corporations which employ 1,000 and more workers and which hire 150 and more workers in each of two or more countries, are to create works council to notify their employees beforehand of management decisions. By September 1996, individual countries will put the EU directive into action and by 1999 at latest, corporations are obliged to found a EWC. However, when voluntarily inauguration of EWC is carried out before the directive takes effect, labor and management of the company can decide on the details of the EWC irrespective of requirements as provided for in the directive. Accordingly, many multinationals have already moved toward voluntary establishment of the EWC.
Honda Motor Europe(HME Leding, UK), which controls all Honda facilities in Europe, was the central actor in establishing the works council for 23 companies in 16 European nations, including four-wheel and two-wheel vehicle plants and distribution facilities. Twenty-two representatives of workers from the 16 countries were elected . About 60 persons, including top managers of HME and individual corporations gathered for the first regular meeting in Majorca, Spain.
In the regular meeting to be held once a year, Honda will report on business performance and management policy and projects for a new fiscal year for Honda facilities in Europe and will be questioned by representatives of workers. These representatives will then notify employees in production facilities in European nations of what was discussed and decided. When it is necessary to alter management policy such as a decision for closure of a plant, management and employee representatives meet for an extraordinary gathering to report on the matter beforehand.
Honda's newly inaugurated works council is characterized by the following features. First, the EWC involves all production facilities throughout Europe with the objective of cooperation between labor and management regardless of the EU directive. Second, Honda's EWC deliberately includes employees of Honda facilities in Britain, which accounts for a shade over 40 percent of the total of 5,200 European workers. Third, employees of Honda plants in Switzerland, Czecho and Poland which are not the EU member nations are also included. Particularly, noteworthy is the fact that Honda does not have to allow employees in Britain to join the works council since Britain is not covered by the EU directive.
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