The State Labour Inspectorate (VDI) reminds that these employee representatives operate under different conditions, but their common goal is to represent employees’ labour, social and economic interests.
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“Employee representatives are not just a formal requirement of the Labour Code. They help ensure dialogue between employees and the employer, promote employee involvement in decision-making, and help resolve labour relations issues in a timely manner. Properly functioning social partnership often helps avoid conflicts and labour disputes,” says Rasa Ruibė, Chief Specialist of the Labour Law Division of the VDI.
If a company employs an average of 20 or more employees, a works council must be established, except when a trade union operating at the employer level unites more than one third of all employees. In such a case, a works council is not formed, and the trade union takes over all functions of the works council. When a company employs fewer than 20 employees, an employee trustee is elected for a three-year term, to whom essentially the same rights, duties, and guarantees apply as to a works council.
Although both the works council and the trade union represent employees’ interests, their purpose is not identical. A trade union primarily defends the labour, economic, and social interests of its members, participates in collective bargaining, and can conclude collective agreements. The works council represents all employees and focuses mainly on information, consultation, and employee participation procedures in employer decision-making.
One of the most important functions of employee representatives is to ensure employees’ right to be informed and consulted. The Labour Code stipulates that the employer must provide the works council with timely and free information on matters affecting employees’ labour, social, and economic interests, and during consultations, seek dialogue and solutions satisfactory to both parties. At the request of employee representatives, at least once per calendar year, the employer must also provide information on the company’s economic situation, the state of labour relations, possible changes in employment, organization of working time, changes in wages, and other data specified in the Labour Code.
The employer must also carry out information and consultation procedures before making certain decisions significant to employees, for example, approving some local normative legal acts, planning group redundancies, or transferring a business or part thereof. If there is no works council, these procedures are carried out with a trade union operating at the employer level.
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According to R. Ruibė, it is important to understand that informing and consulting is not merely a formal presentation of information. “The purpose of consultations is to create real opportunities for employee representatives to express their opinion even before decisions are made that may affect employees’ working conditions,” notes the specialist. “Such dialogue helps to make more informed decisions and strengthens trust within the organization.”
The VDI also notes that from November 1, 2026, amendments to the Labour Code strengthening collective labour relations will come into force. Agreements between the employer and the works council will be able to include provisions for the professional development of works council members, and it will also be clearly established that their activities and training will be financed by the employer.
The possibilities for applying collective agreements will also be expanded – if the parties to a national, territorial, or sectoral collective agreement agree, it will be possible to apply not only the entire collective agreement but also its individual provisions to employees of employer organizations that have signed this agreement, in the manner specified in the collective agreement. Furthermore, opportunities for employee participation in the management of legal entities are expanded, and stricter liability is foreseen in collective labour disputes concerning rights – a party that violates labour law norms or agreements between parties may be subject to a fine of up to ten minimum monthly wages.
“Effective social partnership begins with a clear understanding of the role of employee representatives,” emphasizes R. Ruibė. “The more active the cooperation between the employer and employee representatives, the more opportunities there are to resolve labour issues through dialogue, without waiting for them to turn into labour disputes.”
