Supervisory Board election – the main election committee must scrutinise the electoral rolls and examine nominations without delay

Facts of the case

The parties are in dispute over the validity of the election of employee representatives to the supervisory board at a security sector group holding company with just over 20,000 employees in Germany. The election took place on 29 September 2022. For the ‘Region North’ workplace, established under the collective agreement, the chair of the regional works council there, Ms W – who was also a member of the main election committee – had sent a list of voters. In the same email, she pointed out that the ‘workplace election committee’ would not meet until 13 May 2022. In fact, this committee was never constituted.

Nevertheless, on 9 May 2022, the main election committee issued the notice regarding the submission of election nominations, with a deadline of 20 June 2022 at 4.30 pm. On the Friday following Corpus Christi, the election nomination ‘The Right Choice!’ was received, on which Ms W was standing as a candidate. As the majority of its members were absent, the Main Election Committee did not examine the nomination until after the deadline had passed; it initially deemed it valid but later excluded it from the election due to the invalid electoral roll. Several employees contested the election; some left the company during the course of the proceedings.

The decision

The Federal Labour Court (BAG) confirmed the invalidity of the election of all employee representatives on the supervisory board. The challenge was admissible. Under Section 22(2)(1)(1) of the Co-determination Act (MitbestG), it is sufficient for at least three of those challenging the election to have been eligible to vote at the time of the election; the need for legal protection only ceases to apply once all those challenging the election have left the company. Nor did a possible conflict of interest under professional regulations on the part of the representative in the proceedings, the allegation of collusive behaviour by individual challengers, or the forthcoming re-election in 2027 negate the interest in legal protection. Ms W’s membership of the main electoral committee did not constitute grounds for challenging the election, even though she was not on any valid electoral roll. What is decisive is substantive eligibility to vote, as no electoral roll can exist at the time the main electoral committee is appointed. Her candidacy was equally inconsequential; furthermore, the deadline on the final day could be limited to the end of working hours.

The challenge was well-founded on the basis of two breaches of duty by the main election committee. Whilst it is not, in principle, obliged to take on the tasks of the works election committees itself, it follows from its responsibility for implementation under Section 3(1) of the Third Election Regulations to the Co-determination Act (WOMitbestG) that it must not tolerate identifiable errors. It should have made enquiries with the works election committee or waited for its announced meeting. Furthermore, it breached its duty to carry out an immediate review under Section 34(2)(2) of the 3rd WOMitbestG, as it failed to make arrangements for a review before the deadline expired – even though the bank holiday was already foreseeable at the start of the deadline. An impact on the election result could not be ruled out.

Consequences for practice

The Federal Labour Court (BAG) largely applies its case law on works council elections to supervisory board elections under the Co-determination Act (MitbestG) and makes it clear that the greater organisational effort involved does not justify more lenient standards. This decision is of significant importance for companies. Errors by the main election committee can invalidate the election of all employee representatives on the supervisory board – including senior executives and trade union representatives. Furthermore, the right to challenge the election is not subject to the condition that a re-election would be reasonable; arguments regarding costs or the duration of the proceedings therefore do not help employers. Nor does collusive behaviour on the part of individual parties automatically preclude a challenge.

Practical tip

Companies should support the main election committee at an early stage in verifying the composition of all works election committees and the origin of the electoral rolls before the notices are issued. The deadline for submissions should not be set for a day following a public holiday or a long weekend; at the very least, the quorum of the main election committee must be ensured during the final phase of the deadline. Incoming nominations must be checked on an ongoing basis and not only once they have been collected after the deadline has expired.