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Transposition of the SE legislation in Portugal (Update: March 2005)

Landslide Victory for the Opposition in General Election May Postpone Transposition: European Council Regulation (EC) No. 2157/2001 of 8 October 2001 on the Statute for a European Company (SE) has been transposed into Portuguese national legislation by Decree-Law n.º 2/2005 (4 January 2005). Council Directive 2001/86/EC of 8 October 2001 supplementing the Statute for a European Company with regard to the involvement of employees has not been transposed yet. In October 2004 the project for the transposition of this Council Directive was published in the Official Journal of the Labour Ministry, passed through the process of public evaluation and was ready to be promulgated by government decision (Decree-Law voted by the government). However, in November 2004 the President of the Portuguese Republic decreed the dissolution of the Parliament, and at the beginning of December the conservative government stepped down. Elections on 20 February 2005 brought a landslide victory for the Socialist Party (PS): for the first time in its history the PS won an absolute majority. The new government, led by PM José Sócrates, took office on 12 March 2005. ring the transition period between November 2004 and March 2005 the conservative government did not pass the Decree-Law transposing the Council Directive on workers’ involvement. Thus, the new Socialist government will have to decide whether to pass the Decree-Law as it was prepared by its predecessor or to make some amendments.

Evaluation by Social Partners

In their evaluation the employers and the unions have criticised the fact that the transposition project goes beyond a number of the Directive’s provisions. While the employers see this in the first place as a problem of higher ‘costs’ (time-consuming procedures, financial expenditure, etc.), the trade union camp points to the loss of autonomy of the negotiating parties.

The employers’ critique and subsequent demands are clearly directed at limiting costs and the scope and range of involvement. Thus they demand, among other things:

  • limitation of the geographical scope of the workers’ council’s representativeness (European Economic Space, see project article 4-a) to the European Union;
  • limitation of obligation to cover costs to only one expert;
  • abolition of regulation on payments to experts (project article 35: 3 and 4);
  • limitation of travel expenses;
  • reduction of time credit for workers’ representatives (project article 43);
  • reduction of fines (project article 45).

The trade unions, on the other hand, are seeking:

  • effective regulation of the election/appointment of workers’ representatives (special negotiating body and representative body);
  • effective rules for workers’ involvement in case of a failure to reach agreement;
  • clear rules on confidentiality;
  • protection for workers’ representatives;
  • effective regulation against misuse of the SE to reduce or deny workers’ participation rights;
  • effective regulation of compliance with the Directive.

From this perspective, the trade union critique pointed out that the project fails to transpose important aspects of the Directive in a complete and correct fashion. Central criticisms include:

  • the definition of ‘representative body’ (designated in the project as ‘Workers’ Council’), while the Directive leaves it to the negotiating parties to freely decide on the involvement regime (project article 4-b);
  • the regulation that gives the participating company with the largest proportion of employees and its headquarters in Portugal the right to determine the number of members of the special negotiating body and the countries in which they should be elected or appointed and to set a time limit for their election/appointment (project article 9);
  • the regulation on the agreement on involvement between the SE and the SNB that, on the one hand, limits the autonomy of the negotiating parties (revision of the agreement), and on the other, does not regulate sufficiently the resources to be made available to the representative body (project articles 16 and 18);
  • the omission of a regulation on certain aspects of obligatory involvement (paid free time for workers’-representative training – Directive Annex Part 2-g, and material and financial resources for the representative body – Directive Annex Part 2-h);
  • the exclusion of workers’ representatives on SE governing bodies from employment protection (project article 43);
  • the omission of a regulation on administrative or legal procedures to enforce Directive implementation (Directive, Article 12-2).

Notwithstanding their distant, even opposing, positions, the employers’ and the trade unions’ criticisms converged on the demand for a ‘profound revision’ of the transposition project.

At the moment we do not know what new Labour Minister José Vieira da Silva and his team will do regarding transposition


Full report: Transposition of Se legislation in Portugal (March 2005)

Full report: Transposition of Se legislation in Portugal (March 2005) Portugal transposition SE march 2005.pdf 61,69 kB

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