Workers’ rights to interfere with the appointment of company directors

In the Dutch model of worker representation, there are several possibilities for works councils to interfere with the appointment of company directors. The most far-reaching, if certain criteria are met, is the right for works councils in large companies to recommend the appointment of up to one-third of supervisory or non-executive directors. This is potentially an important tool, even though “their” board members do not have the formal role of articulating works council interests within the board. In addition, Dutch works councils have rights to influence the decision about the appointment of directors in the general meeting of shareholders. They also have the right to be consulted in the appointment of directors in the company's affiliated business. Whether and how this ability to interfere with the appointment of directors affects the running of the company depends on the real use of the rights granted to works councils. Moreover, the territorial scope places limits on the impact of the Dutch model in international groups.