Environmental issues: new battleground for Social and Economic Committees?

Created on 22 February 1945, the primary objective of the Works Council was “to associate workers with economic decisions and the management of companies”. The scope of the Works Council's powers was consequently “the organization, management and general running of the company”.

Having remained unchanged for a long time, the Works Council’s remit was transformed for the first time in 2017 with the merger of all French employee representative bodies into one: the Social and Economic Committee (hereinafter SEC), following the so-called “Macron” decrees, resulting in the Works Council absorbing the health and safety aspects initially entrusted to the Health and Safety Committee (CHSCT).

Following this first change, environmental issues had gradually began to make their way into the Labour Code, for example via sustainable mobility issues or via the right for the SEC to raise an environmental alert, but August 23, 2021 marks a new milestone for SECs : it will now have to be consulted on the environmental consequences of all management decisions of the company.

Indeed, the “Climate and Resilience” law of August 22, 2021, which was discreetly passed in French Parliament over the summer of 2021, awarded new powers to the SEC and trade unions in order to involve them in the fight against global warming.

Taking up some of the proposals of the Citizens' Climate Convention, this new law bestowed new and relatively broad prerogatives on the SEC, the scope of which has yet to be defined, depending on the use which SECs and trade unions will make of them.

New powers and new resources

Article L. 2312-8 of the Labour Code, which defines the powers of the SEC in companies with more than 50 employees, now specifies that the SEC's mission is to “ensure the collective expression of employees so that their interests can be taken into account on a permanent basis in [company] decisions, particularly with regard to the environmental consequences of these decisions.”

In accordance with these new powers, the SEC will now be “informed of the environmental consequences of the company's activity” during its three regular consultations (Article L. 2312-17 of the Labour Code).

With regard to consultations on specific projects, the consultation of the SEC will now also encompass “the environmental consequences of measures relating to the organization, management and general running of the company” (Article L. 2312-8 of the Labour Code).

In the absence of further details, a broad assessment of the “environmental consequences” will result in employers consulting the SEC on the environmental aspects of many decisions affecting the general running of the company: implementation of remote working, relocating, distribution of sales territories, new technologies, replacement of company vehicles, company catering, etc.

In order to carry out these new tasks, the new law granted the SEC several new tools:

- The Economic and Social Data Base (BDES) became the Economic, Social and Environmental Data Base (BDESE) and will need to be completed with a new item: “environmental consequences of the company's activity” (Article L. 2312-36, 10°, of the Labour Code). A decree will soon specify the elements which must be included in this new tab;

- The scope of the advice which can be given to the SEC by an expert was extended: the mission of the chartered accountant can now include the environmental elements necessary to the SEC’s consultation (Articles L. 2315-87-1, L. 2315-89 and L. 2315-91-1 of the Labour Code);

- The initial training of elected representatives was extended: the economic training of newly elected members of the SEC can now cover the environmental consequences of the company’s activity (Article L. 2315-63 of the Labour Code).

Unclear impact for employers at this stage

At first glance, this new law does not appear to imply great strategic considerations for employers.

Indeed, environmental issues have not historically been the responsibility of employee representatives or trade unions.

Even if some powers had already been entrusted to them in recent years, the role of employee representative institutions and trade unions in this area was rather limited until now and elected representatives consequently do not have any specific knowledge on these subjects.

However, trade union confederations had already taken up environmental issues about ten years ago and had been calling for the involvement of employee representative bodies in the fight against climate change.

Thus, some companies had already set up “environment” or “eco-citizenship” committees upon the initiative of trade unions, through collective bargaining, in the absence of any legal provision related thereto.

Therefore, it cannot be ruled out that SECs will seize this new opportunity and make environmental issues a new battleground, particularly in the context of sensitive operations, such as restructuring projects, adding a new constraint for employers during the preparation of the already cumbersome SEC consultation.

This is all the more true as the French Labour Administration has already taken into account this new law and now checks that the SEC opinions include an environmental component when it examines requests for homologation and validation of Social Plans.

It should also be noted that the accounting and consultancy firms assisting SECs have already adapted and now integrate this new environmental segment in their offers.

In the context of a reorganization project, and notably in the context of redundancy plans, it will therefore be important to be particularly vigilant and to provide the SEC with detailed information on the environmental impact of the project, which may be quite extensive, so that the SEC can issue an informed opinion. The environmental consequences of the following elements in particular come to mind: automation, transfer of production abroad, potential job losses, geographical transfer of some employees to a new site, what will happen to equipment and production lines in the event of closure.

In the absence of case law on these new texts, it is currently difficult to establish the degree of precision expected when consulting on these matters. The decree which will specify the information that must be provided in the “BDESE” database, which is due to be published shortly, should give an initial indication of the level of detail which must be provided on the various points mentioned above, until we know a little more about the consequences of this reform, the outlines of which will no doubt be defined by SECs and case law in the years to come.