Court Ruling

More Powers for Employees

Deutsche Boerse Headquarters in Eschborn near Frankfurt am Main includes logo Source DPA
A ruling at Deutsche Börse could give employees more power country-wide.
  • Why it matters

    Why it matters

    German companies, especially medium-sized firms, may have to give employees a greater say in corporate governance if a German district court ruling is confirmed by higher courts.

  • Facts


    • A German court ruled blue chip firm Deutsche Börse needs to consider foreign employees when composing its non-executive supervisory board.
    • Under German law, a supervisory board need to include employee representatives when the company has more than 500 workers.
    • In Germany’s two-tier corporate governance system the supervisory board hires and fires the top executive and sets broad company policy.
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Germany’s co-determination law gives workers the right to sit on the company’s non-executive supervisory board, which hires and fires the top executive and sets broad company policy.

At exchange operator Deutsche Börse, a legal fight has erupted about a key question: Do company employees working outside Germany count for purposes of the law?

The ruling, if confirmed by higher courts, could affect especially medium-sized firms, which jointly are one of the largest producers and exporters in Germany.

The co-determination law defines when a German company must establish a supervisory board and when employee representatives need to be included in the non-executive panel.

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