Germany : Daimler head-office WC election is annulled on the basis that it is representing employees who are geographically too far away (in brief)

At the end of April 2019 and following complaints lodged by five candidates who unsuccessfully contested Daimler WC elections, the Stuttgart Labor Tribunal annulled the election for Daimler’s head-office WC, where no less than 17,000 employees work (File No. 21 BV 62/18). The Tribunal reasoned that the 41 member WC was also representing employees working in two separate dependent offices and the judge considered instead they should have separate distinct representation. 26 employees work at the Gernsbach training center about 100 km from the Stuttgart head office and 10 Public Affairs division employees work in Berlin, about 600 km from Stuttgart. Judge Michael Büchele, vice-president of the Stuttgart Tribunal held that the Daimler election had not taken into account certain basic principles as decreed by the law on company social representation (Betriebsverfassungsgesetz). This legislation in particular emphasizes that the defense and representation of employees is not possible if the employees are significantly geographically distanced, and that videoconferencing is insufficient to compensate for the physical distance. According to the judge, the fact that none of these employees put themselves forward for election only confirms the problem of representativeness. Daimler’s lawyers indicated the company would decide whether or not to appeal the decision when they received the tribunal reasoned opinion. The ruling has been seen as an alarm bell for the world of business at a time when company restructuring is tending towards the concept of decentralization and smaller more nimble, autonomous, and ‘agile’ structures. Failing any appeal, and when the ruling become definitive, then Daimler will have to organize fresh elections.