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June 6, 2018

Co-determination in Matrix Organizations

NZA-RR, Rechtsprechungs-Report Arbeitsrecht

In issue 6 of the NZA-RR on 26 May 2018, Dr. Hans-Joachim Fritz, head of the Frankfurt Labor Law practice group, commented on a decision of the Düsseldorf Regional Labor Court of 20 December 2017 (Ref. 12 TaBV 66/17).

The core issue of the procedure was the works council's right of co-determination when hiring employees with personnel responsibility if they are not (permanently) at the site concerned. The decision of the Düsseldorf Regional Labor Court dealt with the problems of matrix structures and affirmed the approval of hiring a manager with a superior function, even if he or she usually only works at another location. Due to a manager's authority to issue directives beyond the scope of the individual branch office, it does not depend on the place of residence, but on whether and to what extent the superior may influence the realization of the technical work purpose. By considering the possibility of controlling operational purposes, the Chamber avoided further disputes with a decision of the Federal Labor Court on the (co-determination-free) deployment of external personnel if this is only used in relation to success and activity. Only process- and person-related directives establish a right of instruction which can also trigger the co-determination rights of the works council across companies—not uncommon in matrix organizations, for example.

[PDF available only in German]