The works council – underestimated lever in the digital HR transformation

The project and its budget have been approved so the HR digitalization project could really get started – if it weren’t for the need to consult the works council. Plenty of companies hesitate to make the effort because works councils have a reputation for putting the brakes on things. One in three companies therefore fails to properly involve the works council in the digitalization process, and one in ten even completely ignores the right to operational co-determination (source: WSI Report No. 40, May 2018, Hans-Böckler-Stiftung).

However, experience has shown that involving the works council is worthwhile – assuming you take the following five points to heart.

• Give due respect to the right to operational co-determination.
• Pay attention to the four key roles of the works council.
• Be proactive about involving the works council at an early stage.
• Use the works council as a multiplier.
• Establish and maintain ongoing dialog, and safeguard expertise.

If you do all of this, the works council can take on some of the work as a multiplier and stakeholder, increasing the workforce's acceptance of the transformation, encouraging digital adoption and helping you achieve your project goals faster.

The majority of (HR) digital transformation projects require the participation of the works council on the basis of Germany's Works Constitution Act (BetrVG). For example, the works council always has a right of co-determination when technical equipment is to be introduced that could (potentially) make it possible to monitor employees’ behavior (§ 87 BetrVG). When it comes to HR digitalization, this particularly applies to performance management tools because these record and analyze employees’ performance as a means of supporting junior staff or identifying training needs, for example.

When it comes to involving the works council in HR digitalization, companies should be aware of the following roles of the works council:

The works council is ...

… a player in digitalized HR processes when HR processes are digitalized that actively involve the works council, such as getting the approval required by law for hiring staff using applicant management software.

… a partner with co-determination rights when an existing team is dissolved and the members are to take on new tasks as a result of the introduction of digital HR tools, for example.

… a stakeholder in staff training when it is involved in determining the training required to prepare the workforce for new or changing tasks caused by HR digitalization or the resulting restructuring.

… a partner in designing works agreements because concluding works agreements (e.g., defining the framework conditions for using digital HR tools) creates legal certainty for employees and employers alike.

Companies should involve the works council at an early stage – ideally before the official start of the project – in all four of the roles mentioned above. It is best not just to inform the works council of what is set to change and what the objectives are, but to also involve it in the planning process. This creates a shared platform of trust, takes away some of the anxiety about upcoming change, and generates helpful suggestions.

Another advantage of listening to the works council’s viewpoints – and therefore also those of the staff – is that this makes it possible to address fundamental questions early on that the project team might otherwise have considered too late. So, always allow for critical questions!

When it comes to issues such as data protection or the functionality of cloud-based HR tools, it can also be helpful to involve an implementation partner, as they could have valuable experience from similar projects.

Comprehensive communication and a diverse range of training opportunities increase employees’ willingness to accept the planned changes. Measures such as this are vital to workforce acceptance of the transformation process and thus to the success of the project. The various interest groups (stakeholders) play a key role in this, generally in the form of the decision makers and managers. If the works council is also involved, it can act as a multiplier, too. By keeping the company committees and teams updated, skillfully answering staff questions and addressing concerns, the works council can support the change management process and take some of the burden of this from the project team.

It is frequently said that works councils aren’t very IT-savvy – often unfairly. This must not be used as a justification for not involving the works council in a digitalization project. Instead, it should be offered training courses – as an investment in constructive collaboration. Furthermore, it is advisable to engage in regular dialog with the works council and invite the members to project meetings or strategic round tables, for example.

Practice has shown that, just as for HR transformation, it is worthwhile getting the works council involved in the planning, selection and prioritization of transformation projects for HR digitalization at an early stage, and on an ongoing basis. As a result, the company can achieve legal certainty in HR digitalization and generally complete the project on time and on budget – without the works council applying any brakes.