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A Solution for Transnational Labour Regulation?

Company Internationalization and European Works Councils in the Automotive Sector

Axel Hauser-Ditz, Markus Hertwig, Ludger Pries and Luitpold Rampeltshammer

This book examines the role that European employee representatives play in the restructuring of firms. In a globalized economy, company internationalization and transnational restructuring are of growing concern for employees and trade unions. In the European Union, the still rather new institution of European works councils provides basic rights for employees. Using examples of eight large automotive manufacturers like Volkswagen, GM or Toyota, the volume analyzes the internationalization strategies of the companies and the effects of European works councils, pointing to a high degree of variation in strategies and effectiveness of cross-border employee representation.
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Chapter 3: Theoretical and methodological framework


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Chapter 3:  Theoretical and methodological framework

The core of this study consists of a relatively innovative perspective on EWCs that draws on approaches within transnationalisation research and comparative (international) organisational research. In this, EWCs are understood as non-profit organisations established on the basis of a unitary European institutional foundation and distributed across a number of nation-states, existing and acting both within companies operating across the EU as well as externally upon them. Whereas works councils (both at workplace and company level) can conventionally be viewed as sub-units or sub-organisations of a firm’s organisation, subject to a unitary national legislative framework and institutional setting, matters are considerably more complex in the case of EWCs as these are established on the basis of a European provision that is only effective after being transposed into a multiplicity of national laws. From a formal legal point-of-view, an EWC is a European non-profit organisation in the sense of having clear membership rules, a given structure and clear aims in terms of employee representation and the establishment of dialogue with the central management of European companies.

Although internationally-operating companies, understood as ‘corporate actors’, must also coordinate spatially distributed operations that function on the basis of diverse statutory regulations in heterogeneous institutional and cultural settings, in contrast to EWCs, understood as non-profit ‘collective actors’ and interest organisations, firms are driven by the contrasting logic of for-profit organisations.35 The problem of mobilisation (the ‘transformation problem’) and the issue of balancing...

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