European Works Councils are a form of indirect employee participation which realize the right to information and consultation among employees in transnational companies. They are an extremely important institution of social dialogue at the European level. Functioning of the common market is associated with concentration of plants, mergers on the international scale, creation of branches in different countries, whereas decisions taken by central management of these transnational companies affect workers in all their European subsidiaries. The EWC Directive requires the companies to build a bridge between their decision-making centre and European workers’ representatives. The main aim of this paper is to assess the impact of EWCs on both national systems of industrial relations and transnational companies’ activity. The first part of the article includes an analysis of the character of EWCs as an element of the European system of industrial relati ons and as a source of European identity building. Moreover, the paper attempts to present the consequences of EU enlargement for these institutions and social dialogue. The second part evaluates the statutory rights of EWCs and the influence of these institutions on decision-making process in transnational companies. The main emphasis is put on EWCs impact on strategic business decisions leading to these companies’ restructuring.

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