Co-determination and work councils

In Germany, employee participation, i.e. The ability and right of
employees to infuence company decision-making processes,
takes place mainly through the works council (Betriebsrat) (at the
operational level) and the supervisory board (Aufsichtsrat) (at the
company level).

At the company level, the Coal, Steel, and Iron Industry Co-De-
termination Act (Montan-Mitbestimmungsgesetz – MontanMit-
bestG) requires stock corporations (Aktiengesellschaften – AG)
and limited liability companies (Gesellschaften mit beschränkter
Haftung – GmbH) in the coal, steel, and iron industry with more
than 1,000 employees to grant employees equal representation
on the supervisory board, meaning that the supervisory board
consists of an equal number of shareholder and employee repre-
sentatives.

To avoid stalemates, the supervisory board also has a
neutral member who has no allegiance to either the employees
or the shareholders. Furthermore, a human resource director,
who may not be elected without a majority of the votes cast by
the employee representatives, is appointed to the management
board and is ranked equally with other board members.