Decisions - Employment law - rights and wrongs.

(From Financial Director)

Byline: Neil Hodge.

From April 2005, the Information and Consultation of Employees' SRegulations 2004 gives employees a right to be informed about an Sorganisation's economic situation, employment prospects, and decisions Sthat are likely to lead to substantial changes in work organisation or Scontractual relations, such as the company merging or being taken Sover.

Previously, information rights were limited to consultation about Scollective redundancies, transfers of undertakings, and health and safety. SUnder the new regulations, employers will have to present their future Splans at an early enough stage for workers or their representatives to Sinfluence them, and they must try to reach an agreement. Information and Sconsultation also has to take place at an appropriate time and with the Srelevant level of management.

Lawyers say it is vital that employers look closely at these new rules and Sconsider whether they should be setting up their own consultation Sarrangements, or have the standard default information and consultation Sarrangements.

From April, organisations employing 150 employees or more will be required Sto provide an employee consultative forum if just 10% of the workforce Sdemand it. For companies with less than 150 employees, the rules will be Sphased in over three years. However, unless employees request a Sconsultative forum, companies are under no obligation to set one up. SEmployers can also seize the initiative and put in place their own, less Srigorous forum, which would stand unless more than 40% of the workforce Svoted against it.

The concept of consulting and negotiating on a meaningful level with the Semployee representatives or Work Councils is a familiar one in Europe, but Snot in the UK, says Warren Wayne, partner in the employment department of Ssolicitors Bird & Bird. In the UK, he says, consultation has traditionally Sbeen restricted to establishments with recognised trade unions.