What is a works council (ondernemingsraad) under Dutch law?

Dutch term: Ondernemingsraad | Legal basis: Wet op de ondernemingsraden (WOR)

A works council (ondernemingsraad) is a mandatory employee representation body for Dutch enterprises with 50 or more employees, regulated by the Works Councils Act (Wet op de ondernemingsraden, WOR). The works council has statutory rights of information, consultation and, for certain decisions, approval (instemmingsrecht).

The works council must be consulted before significant business decisions including mergers, acquisitions, major investments, restructurings, plant closures and changes in the organisation of work. For certain matters related to employment conditions (working hours, pension schemes, grievance procedures), the works council has an approval right: the employer cannot implement the decision without the council's consent.

Why it matters for international businesses

For international groups with Dutch subsidiaries employing 50 or more people, the works council is a stakeholder that must be involved in strategic decisions. Failing to consult the works council can result in the decision being suspended or annulled by the Enterprise Chamber.