At first glance, works council elections may look like a local HR issue. In reality, they can significantly shape how automotive companies manage transformation, restructuring and workforce adjustment in Germany. A recent court ruling puts the personal liability of management into focus.
Why do works council elections matter so much for OEMs and Tier 1 suppliers?
The Works Council (“WC”) plays a decisive role in plant transformations, workforce reductions, working time models and site decisions. For OEMs and Tier 1 suppliers under pressure to adapt their business models, the composition of a works council will influence whether change projects move forward pragmatically or become prolonged and contentious. Invalid WC-elections or legal challenges often lead to delays, additional costs and management distraction. A hard-won agreement (for example, on a plant restructuring or introducing an IT tool) suddenly has to be renegotiated. As recently illustrated by the WC election of a leading OEM – 36 of 17.000 employees had been incorrectly assigned to the main plant – minor formal errors can have major consequences, such as the re-election of the entire WC.
Is the employer expected to stay neutral and silent?
No. While employees (the election committee) organize the election, HR management is not required to step aside completely; nor should they. They may express opinions, outline expectations for cooperation and flag procedural errors – provided they do not exert pressure or threaten disadvantages.
HR-Managers may, for example:
- express opinions about the existing or future works council,
- criticize works council actions,
- signal support for certain candidates or lists, or
- encourage suitable employees to stand for election.
The key for HR management is balanced engagement: visible, documented and compliant.
Moreover, Management bears considerable responsibility, particularly in large structures or complex corporate groups, for example for:
- providing the election committee with of voter lists,
- providing information on group and company structure,
- providing actual and financial resources to run the election.
Who is protected against dismissal?
German employment law protects not only elected works council members, but also people who become involved very early in the process – even before an election committee is formed. For companies undergoing restructuring, this means decisions on terminations, redeployments or role changes should be carefully reviewed if there are any indications of a works council initiative.
German law provides extensive protection for:
- Members of the election committee
Protected from dismissal from appointment until six months after the election result.
- Works council members
Ordinary dismissal is generally excluded during their term of office.
- Candidates for election
Protection starts once the nomination is submitted until six months after the election result.
- Election initiators
Employees who formally initiate a works council election, e.g., by calling a works meeting or requesting the establishment of an electoral committee, have dismissal protection from the moment the election is initiated until six months after the election result.
- Pre election initiators
Up to three employees who initiate the establishment of a works council (e.g. contacting unions, canvassing support) may be protected for up to three months, if they have been with the employing site for more than 6 months.
What does the Federal Labour Court’s 2025 ruling mean for matrix organisations?
The Court confirmed that employees in matrix structures may be entitled to vote in more than one works council election, depending on actual integration.
Integration exists when e.g. a manager helps fulfil a plant’s operational purpose – for example, by directly leading or supervising employees there. As a result, matrix managers supervising teams across several sites can be considered members of multiple plants and therefore eligible to vote at each site.
This has a significant operational impact: voter lists for the WC elections become more complex to prepare, and the risk of election challenges increases if integration is not assessed carefully: Voting rights do depend on actual operational involvement, they do not depend on HR assignments or a “home” plant.
For automotive companies with cross‑site development, production, or engineering teams, this means early coordination is essential to correctly identify who is integrated into which plant and to ensure legally sound elections.
Is there a risk of personal liability when it comes to election interference?
Yes! If a manager intentionally prevents or obstructs a works council election, this can trigger not only labor law claims but also tortious claims for damages, including personal liability of the manager with his or her private assets (LAG München v. 16. April 2025 – 11 Sa 456/23).
The court affirmed piercing liability because a managing director had deliberately violated protective laws in connection with the WC-elections. This is particularly sensitive for international corporations: “Local misconduct” can lead to personal liability for local management, regardless of corporate guidelines or corporate structures. For multinational groups, this highlights the importance of local compliance awareness, especially when it comes to sanctioning employees that play a role in the elections!
Key takeaway for Automotive HR & Compliance
Works council elections are not a side issue. For OEMs and Tier 1 suppliers, they are a strategic risk factor – and an opportunity to establish constructive employee relations during a period of profound change. Employers ought to train local HR thoroughly on election regulations and seek early legal advice on the issue. They should treat election related employee sanctions with extreme caution due to potential personal liability!
