NewsSpotify works council wins court casejan
On December 22, 2023, the Enterprise Chamber of the Amsterdam Court of Appeals made a significant ruling in a case involving the Works Council of Spotify Netherlands B.V. (hereinafter: the works council) and Spotify Netherlands B.V. (hereinafter: Spotify NL). The ruling follows a request from the works council regarding a restructuring decision announced globally by the CEO of Spotify on December 4, 2023.
Background of the Case
Spotify is a globally operating provider of streaming services with approximately 9,000 employees. Spotify NL, a Dutch subsidiary with 172 employees, faced an announcement of a global restructuring where about 17% of employees worldwide would be laid off. However, the works council was only informed about the specific implications for Spotify NL during a meeting on December 4, 2023, where it was stated that 19 employees would be laid off, and the works council would not be asked for advice.
Course of Proceedings
Subsequently, on December 18, 2023, the works council requested the Enterprise Chamber to determine that Spotify NL could not reasonably have reached the restructuring decision without prior advice from the works council. They also sought the revocation of the decision and undoing its consequences, with interim measures to prohibit implementation actions. Spotify NL contested these requests in a response.
The Ruling of the Enterprise Chamber ("Ondernemingskamer")
On December 22, 2023, the Enterprise Chamber ruled that the restructuring decision of Spotify NL is subject to consultation under Article 25 of the Works Councils Act (WOR). The announcement of the global restructuring and its specific consequences for Spotify NL constituted a significant reduction in activities and a substantial change in the organization. As Spotify NL had not informed and consulted the works council in a timely manner, the Enterprise Chamber concluded that Spotify NL could not reasonably have reached the decision.
The Enterprise Chamber declared that Spotify NL could not reasonably have reached the restructuring decision, obligated Spotify NL to revoke the decision and undo its consequences, and prohibited Spotify NL from performing actions for the implementation of the decision. Other requests from the works council were rejected.
Conclusion
This ruling underscores the importance of timely and comprehensive consultation with the works council regarding significant decisions that profoundly impact employment and organization. For companies, especially in an international context like that of Spotify, this highlights the importance of clear communication and collaboration with employee representation bodies to prevent legal disputes. It empowers the works council to safeguard the interests of employees in the face of substantial business decisions. Incidentally, the works council (after being notified of a decision) has only one month to initiate proceedings at the Enterprise Chamber. This is a short period of time. If you are a member of a works council and doubt whether a case at the Enterprise Chamber is possible, please contact us as soon as possible. By law, the costs for legal advice are in principle for the company or organization.
