Works councils in professional football?
Works councils in professional football?
Hertha BSC Berlin was relegated to the 2nd tier of the Bundesliga after a season full of on and off the field problems. Possibly as a result of these problems, staff were reportedly planning to establish a works council at the end of last season. This development attracted some media attention, but are works councils in German professional football so unusual?
The purpose of this article is to elaborate on how a works council is established and what it means for the employer/football club.
Works Councils and professional sport
German professional football clubs are not unfamiliar with employee representative bodies. After all, works councils have been formed at prominent clubs such as Borussia Dortmund, HSV and FC Schalke 04. Despite the extensive statutory rights works councils have, little is known about their involvement at professional sports clubs. A works council does have the potential to materially impact the running of a club as it needs to be consulted with or at least informed about most aspects of the “business”, including information on staff planning, hiring and redundancy of employees or scheduling of working time.
What is a works council
A works council is an employee representative body which consists solely of employees of the relevant employer. If established, it is vested with a wide range of powers of engagement and has the potential to help or hinder the business. A works council will be competent for the “operation” i.e., the local business, but if there are several locations, there can be several works councils and one umbrella works council. There are also group-wide works councils in larger enterprises. Sports clubs will tend to have one location and therefore, if at all, one works council. The size of the works council is generally determined by the number of employees entitled to vote in the respective location. For example, in clubs with 101 up to 200 employees, the works council would consist of 7 members and in clubs with 201 up to 400 employees of 9 members etc.
Establishing a works council
A works council would be established at a football club in the same way as at any company.
The starting point for a works council election is a works council-competent operation within the meaning of the German Works Constitution Act (“BetrVG”). The operation must regularly have at least five permanent employees entitled to vote, three of whom are eligible for election, which will nearly always be the case in sports clubs. If the criteria are met, a works council can, but must not, be established by the employees of the club.
It is relatively straightforward for employees to set up a works council. An election committee is formed as a special electoral body, in particular for the preparation and conduct of the election and the determination of the election results. If there is no works council at all yet three employees entitled to vote, or a trade union may invite all staff to a staff meeting at which the majority of the employees present then elect an election committee. The election of the works council, then takes place by secret and direct ballot and includes, among other things, the election notice, the drawing up of electoral lists, the determination of the employees entitled to vote and the number of works council members to be elected, the publication of the electoral list and the election regulations, and therefore takes several weeks. Once established, regular works council elections must generally be held every four years between 1 March and 31 May.
As in many sectors, employees often choose not to pursue establishing a works council. However, if there is staff dissatisfaction, the risk the employees elect a works council to safeguard their rights increases.
Participation rights with revolutionary impact?
Once a works council is established, it has comprehensive co-determination rights (information rights, consultation and proposal rights, consultation rights and the (genuine) co-determination rights). The competence of the works council extends to the operation and covers all employees with employee status with the exception of “managerial staff”. Since there is neither a (legal) privilege for professional clubs nor can the works council effectively waive co-determination rights, the regulation of the working time of professional players, head and assistant coaches as well as sports directors would be subject to co-determination. Similarly, the works council could assert a mandatory right of co-determination for team bonuses. Player transfers, which are in any case highly complex due to internationally varying transfer windows, contract negotiations, applicable association law and medical checks, could also be subject to co-determination rights.
Works council agreements, e.g. on the scheduling of working time or the distribution of bonuses, are agreements concluded by the employer and the works council and are commonplace in the wider working world. However, running a club is hardly comparable to running a business, so in practice, there won’t be too many works council agreements at a club and works councils at sports clubs tend not to exercise their competence on player and coach transfers and recruitment, let alone team matters.
Competence for professional players, coaches, and other employees
Since professional players in clubs are generally, in some cases very well-paid, employees, they are covered by the competence of a works council. It is true that certain individual professional players occupy an exposed position in a team structure due to their outstanding playing abilities. Nevertheless, the impact of a professional player on the success of a team does not elevate his status to a managerial employee. Head coaches and other team staff are also employees and covered by the works council, despite them being largely responsible for the training content, the tactics, and team composition. In Germany, the team management structure largely consists of a head coach (who will be an employee and therefore represented by the works council) and a sport director/team manager who will tend to have the status of a manager or executive (and therefore not represented by the works council). Accordingly, the works council would be competent for monitoring employee protection laws in relation to players and coaches and would also be involved in, among other things, their recruitment and dismissal.
In most clubs of course, most of the employees are not coaches and players. There will be employees in the business services, inter alia in marketing, sales, R&D and public relations and it is probable that the works council will tend to focus on protecting them. When a club is relegated, the revenues are severely hit, and redundancies are inevitable: a works council will usually need to be consulted in detail about lay offs and this may be one of the factors leading to Hertha Berlin reportedly now having a works council.
Other employee representative bodies in professional sport
As players in practice are currently not represented by works councils in clubs, there is often a players' council which, although it has no official rights, is involved in decisions by the club and negotiates players’ bonuses and fines for minor breaches of contract.
Further potential representative bodies with employees represented on them are supervisory boards and committees for managerial employees. According to our knowledge, there are currently no co-determined supervisory boards at Bundesliga clubs.
Opportunities and risks
As sports clubs get bigger, employ more staff and become more and more professional, it is not inconceivable that more sports clubs will end up with works councils. This may not be disadvantageous for the employing club as the works council members will be employees and probably fans of the club. Much will depend on the skills and agenda of the works council members. As long as the works council and club management can work together well and there is an understanding about which areas the works council will be involved with, and which are deemed to be off-limits for the sake of the first team. One day a works council will make the argument it needs to be consulted with about trainer dismissal or team matter, but for now, that seems far-fetched.
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