codetermination

business

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June 24, 2026

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Codetermination is a business practice where labor participates with management in determining company policy. This concept is particularly prominent in Germany, where laws mandate formal structures for employee representation in management decision-making processes.12

In Germany, works councils, elected by employees in companies with 20 or more workers, are legally required to consult with management on various employee issues. Furthermore, a system of codetermination allows for worker representation on the supervisory boards of large companies. These worker representatives must approve the appointment of key executives, including the personnel director, giving employees a voice at the highest levels of corporate decision-making.2

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organized labour
Breakup of the postwar settlement: Inflation, neocorporatism, and restructuring
“Codetermination,” as it was called in Germany and Sweden, provided workers with quasi-constitutionalized shop-floor representation on nonwage matters, such as work organization, that industrial unions had been unable or unwilling to address before 1968. Thus, in order to prevent a return of the representation gap…
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“Codetermination,” as it was called in Germany and Sweden, provided workers with quasi-constitutionalized shop-floor representation on nonwage matters, such as work organization, that industrial unions had been unable or unwilling to address before 1968. Thus, in order to prevent a return of the representation gap…
Read More

industrial relations
Consultation and codetermination
…provides for a system of “codetermination,” or worker representation, on the supervisory boards of large companies. (Supervisory boards are similar to the boards of directors in American firms.) The supervisory board appoints executives to top management positions, including the Arbeitsdirektor, or personnel director. This person must be approved by the…
Read More
…provides for a system of “codetermination,” or worker representation, on the supervisory boards of large companies. (Supervisory boards are similar to the boards of directors in American firms.) The supervisory board appoints executives to top management positions, including the Arbeitsdirektor, or personnel director. This person must be approved by the…
Read More