Employees Have a Say How co-determination works on the supervisory board

In Germany, there are two forms of co-determination: workplace co-determination and corporate co-determination. Corporate co-determination gives employees at larger companies the right to be represented on the supervisory board. This board is then composed of representatives of the employees and representatives of the company’s shareholders.

Supervisory boards appoint, advise, and oversee the executive board and review the annual financial statements of the corporation. However, they are not permitted to intervene directly in day-to-day management.

Size Matters

The strongest form of co-determination exists in the mining and steel industry (iron, steel, coal). There, supervisory boards are composed on a parity basis. This means that employees and employers each provide half of the supervisory board members. An additional member, who must be neutral, serves as chair.

One-third co-determination—whereby the employee side holds one-third of the seats on the supervisory board—applies to corporations with more than 500 employees.

In corporations with more than 2,000 employees, equal co-determination applies. In case of a tie, however, employers generally have the upper hand, as the chair of the supervisory board—who always comes from the management side—has a double vote.

The size of equally represented supervisory boards—with 12, 16, or 20 members—depends on the number of employees. The more employees a company has, the larger the supervisory board.

The Well-Being of Employees

Metalworkers are represented on numerous supervisory boards. Our first rule for supervisory board work is: We are committed to the well-being of the employees. Our top priority is the long-term security and creation of jobs.

Strong co-determination has many advantages. Employee representatives understand the needs of the workforce and know where specific changes are needed. Employee representatives focus on the long-term success of the company, while shareholders and management often base their decisions on short-term profits.

Explanatory video on employee participation on the supervisory board

Financial Rules

Employee representatives retain only a small portion of their Supervisory Board compensation. Members of IG Metall who serve as employee representatives on a Supervisory Board must account for the proper remittance of their bonuses.

If they receive more than 5,000 euros per year for their role as regular supervisory board representatives—or more than 7,500 euros as vice-chairs—they must contribute 90 percent of the amount exceeding these thresholds to the Hans Böckler Foundation, a union-affiliated organization. Those who receive less must still contribute 10 percent of their compensation.