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Compliance Alert: Supreme Court of the Netherlands Rules on Work Council’s Right to Advise on Group Hiring 

By Asha Jokhoe, Legal Counsel Benelux 

In a landmark ruling, the Supreme Court of the Netherlands has clarified the role of the Works Council in the process of hiring a group of temporary agency workers. This decision directly affects Albert Heijn (AH), one of the Netherlands’ largest supermarket chains, and its e-Commerce division, where approximately 90% of the work is performed by Temporary Agency Workers (Workers). 

The Workers are employed by various Temporary Work Agencies (Agencies) that have secured a framework agreement with AH through periodic tender procedures. The dispute arose when AH’s Works Council asserted its right to advise on the renewal of these agreements, citing article 25-1g of the Works Council Act which grants this right for recruiting or hiring a group of workers. AH contested this, arguing that this was part of their regular hiring process. 

The Supreme Court, in its ruling on November 03, 2023 (Albert Heijn e-Commerce vs its Works Council 22/04443), stated that the Works Council indeed has the right to advise on hiring a group of workers, irrespective of whether it deviates from the company’s regular hiring process. 

Understanding the Impact

To understand the implications, let’s delve into what a Works Council does and what group hiring entails. 

The Works Council 

In the Netherlands, any company with 50 or more employees must establish a Works Council. This body represents employee interests and encourages employee involvement in the organization’s decision-making process. It wields several rights and powers within the company, including the right to advise and the right of approval. In this case, the Supreme Court has further defined the scope of the right to advise, specifically concerning the recruitment and hiring of workers on a group basis. 

Group Hiring and Recruiting 

This term generally refers to large-scale recruitment and hiring activities. It includes the employment of a group of temporary agency workers at a given time or the conclusion of a framework agreement with a temporary work agency for future hiring. 

Decisions around recruitment or hiring can significantly impact the work situation of staff, making consultation with the Works Council crucial. The Enterprise Chamber previously ruled that consultation was only required in case of deviations from a company’s usual policy. However, the Supreme Court has now expanded this interpretation. 

The Supreme Court’s Ruling 

The Supreme Court was tasked with determining whether the Works Council’s right to advise is only applicable in cases deviating from a company’s usual policy, or in all instances of group hiring. It ruled in favor of the latter, stating that the company should have sought the Works Council’s advice on the decision to enter into new framework agreements with the Agencies. 

Implications of the Ruling 

This ruling signifies a shift from the previous viewpoint that the right to advise was relevant only in decisions deviating from a company’s regular process. Following this ruling, the Works Council will need to adopt a more proactive role in recruiting and hiring workers on a larger scale. Moreover, their advice is now required when companies wish to conclude framework agreements with Agencies for a longer period of time. 

As your trusted compliance partner, People2.0 keeps you informed about key legal developments that may impact your contingent workforce management. We’re here to help you navigate these changes and ensure your practices align with the latest rulings and regulations. 

Need a trusted partner to navigate the complexities of contingent workforce management? Reach out to People2.0 today. 

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