ORC Sightlines

January 2009

In this issue:

Revised European Works Council Directive: What Does It Mean for Employers?

European Works Councils have been a fact of life for many employers in Europe for more than a decade. Since the EU Works Council Directive became law in 1996, approximately 850 councils have been set up. Members of a European Works Council (EWC) have the right to meet with senior management in order to be informed and consulted on “transnational issues” affecting employees.

In July, the EU Commission came forward with a proposal to revise the Works Council Directive, which has since been revised following negotiations between the EU social partners—BusinessEurope, representing employers, and the European Trade Union Confederation (ETUC). Slated for formal adoption early this year, the new directive will come into force in 2011.

The most significant changes will be to:

  1. Require management to provide earlier and more complete information to their European Works Council.
  2. Give trade unions a stronger role within EWCs as “expert advisers”.
  3. Boost the powers of EWC members looking to assert their legal rights.

The new directive will also oblige companies to coordinate consultation of their European and national works councils and force employers to renegotiate their EWC agreements in many situations of corporate restructuring, including mergers.

How should companies respond?

Be proactive.

Before the new directive becomes law early in 2011, there is a window of opportunity for employers to review and revise existing agreements to protect themselves from some of the potentially more restrictive elements of the new law.

Consider the impact of the changes on mergers, acquisitions, and restructuring now.

While the new directive will not be law for two years, employers should anticipate that employee representatives and their trade union advisors will immediately seek to implement these changes when faced with restructuring, mergers or acquisitions. Anticipating potential challenges, knowledgeable employers will prepare for major changes as if these new provisions were in effect now.

Share best practices.

Learning from other companies that have European Works Councils has benefitted many employers over the past 13 years since the directive came in to being. ORC’s International Social and Labour Affairs Forum (ISLAF) and the European Study Group (ESG) provide senior HR executives in multinational companies doing business in Europe with confidential networks in which to discuss and share best practices regarding the gamut of international employment, human resources, and industrial relations issues. These groups have been ideal vehicles for companies seeking to anticipate and respond proactively to change.

For more information on EU issues or ORC Worldwide’s global human resources and industrial relations services, contact Philip Sack, Director of the ORC International Social and Labour Affairs Forum (ISLAF) and the European Study Group (ESG), or William Bruce, Senior Vice President of Global Labor and Employee Relations for ORC.

Breaking the Cycle: New Approaches to U.S. Workplace Safety & Health Policy

On the eve of the national election, and before Barack Obama’s transition team began the work of considering new policy initiatives and searching for new top-level federal government appointees, ORC Worldwide published its quadrennial perspective on aspects of workplace safety and health that are ripe for consideration by both the new administration and the broader safety and health community. Excerpts are presented here; the full white paper is available for download at http://www.orc-dc.com/?q=node/2007.

In this time of unprecedented national and global challenges, we believe the safety and health community should search for new ways of thinking about how to advance worker safety and health over the long term and how to increase the likelihood of finding common ground on important issues. We are frankly weary of the culture of confrontation that perennially pervades the debates over workplace safety and health policy, that leads to political stalemate, and that has alienated much of the safety and health community. Significant and lasting progress is most likely to occur only if the stakeholders in the safety and health community insist on creating a new more collaborative infrastructure and developing new systemic approaches to addressing national safety and health policy issues.

"ORC recommends the new administration establish stakeholder and public dialogues, forums, and processes that we believe could begin to form a foundation for significantly improving worker safety and health over the next decade. In particular, we suggest that these processes address three fundamental issues:

  1. Developing specific strategies and an action plan for promoting, incentivizing, and assuring the adoption by all U.S. employers of systems-based approaches to assessing and reducing safety and health risks.
  2. Conducting a comprehensive multidisciplinary expert evaluation of the stagnated OSHA standards-setting system and for developing specific recommendations for workable legislative and administrative improvements and effective alternatives.
  3. Developing key national safety and health policy initiatives as well as in the prioritization of such initiatives.

"These suggestions represent a long-term initiative that would require the commitment of leaders in business, labor, government, and all in the safety and health community to break the cycle and create lasting change. ORC will be actively engaged with other stakeholders in attempting to generate support for these recommendations for a more collaborative infrastructure and new systemic approaches to addressing national safety and health policy issues. We will work with the new administration as it is formed in the coming month to encourage consideration of these proposals."

For nearly 38 years, ORC Worldwide has helped the world’s leading corporations achieve and sustain workplace safety and health excellence. ORC is also an industry voice on national and global safety and health policy issues. Currently, more than 140 leading global corporations in more than 20 industry sectors are members of ORC’s networks for Occupational Safety, Health, and Environmental professionals around the world. For more information, contact Joanne Linhard, 1-202-293-2980.

What Can You Say About Pay? How to Communicate Effectively About Compensation

Communications between employers and employees about compensation can be frustrating for both sides. Employees don’t always trust management to give them the straight scoop when it comes to how their pay stacks up to other companies, and they’re not always ready to hear about all the benefits of their employment that management thinks they should appreciate. Managers struggle to clarify the value of monetary and nonmonetary rewards in a credible way while maintaining appropriate confidentiality.

So what should you say to employees about their pay?

Say something that resonates with your audience.

HR folks may think about market comparators and midpoints, but employees think about net pay and the amount of their biweekly bank deposits. Think about what employees’ want to know and craft the message in terms they will relate to.

Say something empowering.

Employees want to know how their pay compares to the marketplace, but they also want to know how they can increase their pay. Talk about factors over which the employees have some control (performance, career choices, highly valued behaviors). Tailor your message to the audience. To a younger crowd, a five-year vesting period is a long time, and retirement is a lifetime away, so focus on the immediate future first and then distant goals.

Say something that completes the story.

You can lose your audience by overwhelming them with loads of confusing data, but you’ll lose credibility if you are too vague about where the numbers come from. The last thing you want is for employees to look for alternative information sources that may or may not be accurate. Your listeners can comprehend a large amount of data if it is germane and well organized.

Name the companies that participate in your salary surveys. Tell employees how comparators in other locations and industries are used. Explain the factors that went into determining the merit or bonus pool. Outline your organization’s pay philosophy. If you can confidently predict your audiences’ questions, answer them in your communications before they are asked.

Say something revealing.

Don’t waste time—and risk losing your audience’s attention or trust—talking about what is convenient or conventional. Reveal something new, or at least present it in a new way that will make your audience sit up and take notice and perhaps register a concept they had not thought about or thoroughly understood before.

Say something that separates pay from emotion.

Put emotion in your message but detach it from the facts. Educate about the science behind pay. Your employees should be able to explain why they are paid what they are paid and feel good about.

Say something short and to the point.

Eliminate the fluff. Creating succinct materials that includes everything that’s important and hits home is a lot harder than creating lengthy pieces that go unread. Get a good editor who understands your content and allows sufficient development time.

Say something that gives you a return on investment.

There is real data linking good communication practices to increased employee engagement and commitment, retention, productivity, and financial performance. Even in a downturn—especially in a downturn—a communication project with a budget that equals a tiny fraction of your salary expense can help you realize substantial return on your talent investment.

For more information on employee communication strategies or to learn how ORC can help you develop effective communications, contact Dea McKenzie, Vice President, Communication and Marketing, 1-212-852-0377.

New Seminar Gets High Praise from Diversity Professionals and Business Champions

ORC's new seminar, Foundations of Diversity and Inclusion Strategy and Practice: An Introductory Workshop, attracted a wide range of enthusiastic participants to the first two sessions held in New York and London during December. The seminar introduced diversity practitioners who are new to the field as well as champions from the business community to the fundamentals of diversity and inclusion strategy and action planning.

During the course of a very full day we covered:

Reaction from participants was extremely positive, and their input has helped us refine the workshop content and materials. This year we are expanding the number and locations of workshop offerings. ORC can also bring the workshop onto employers’ sites so that the organization’s diversity staff, employee network leaders, management champions, and diversity council members can all participate.

More information on Foundations of Diversity and Inclusion, including the 2009 schedule and registration, is available online. Contact Liz MacGillivray or Deirdre Golden for details and on-site workshop options.

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