No Duty to Wait: Operational Changes During an Ongoing Works Council Election (Higher Labour Court of Baden-Württemberg, 2 TaBV 2/25)

In a business without a works council, a far-reaching restructuring involving massive job cuts was imminent. Only when the entrepreneurial decision had already been taken and the first letters of dismissal were on their way did the workforce react by initiating a works council election.

The Higher Labour Court (Landesarbeitsgericht, LAG) of Baden-Württemberg has now made clear that employers may consistently implement planned operational changes even while elections are ongoing. In the event of such a "race" between restructuring and the formation of the body, the obligation to negotiate a social plan (Sozialplan) does not apply if no works council was in office at the time of planning. The court thereby strengthens legal certainty for companies and confirms that an electoral board (Wahlvorstand) cannot stop such measures by way of an interim injunction.

There is no basis in the Works Constitution Act (Betriebsverfassungsgesetz, BetrVG) that compels the employer to postpone entrepreneurial decisions until an election has been completed. As long as no body capable of acting exists, there is simply no negotiating partner for a reconciliation of interests (Interessenausgleich). This makes clear that the mere intention to form a council does not give rise to co-determination rights retroactively.

The judges further emphasised that the protection of § 111 BetrVG is strictly tied to the actual existence of the body. This applies even if the employer accelerates measures in order to pre-empt impending co-determination. In this specific window of time, the employer's freedom of disposition takes precedence over the principle of co-determination. Judicial stop signals for the restructuring are thus ruled out if the employer acts in time.

Companies in structures without a works council do not have to pause restructuring merely because an election has been initiated; what is decisive for freedom from co-determination is that the implementation is ahead of the constitution of the body in terms of timing.