Part VI: Internal Investigations: Role and Rights of Employee Representatives

This Part VI of our Series explains how to involve German works councils in internal investigations without compromising speed, confidentiality, or evidence. The practical bottom line is simple: secure co‑determination where the law requires it, inform and consult early on “system” questions, share only what is necessary on “case” questions, and document your balancing.

Failures can derail measures (for example, dismissals without a proper hearing are void) and fuel disputes, but they do not automatically bar otherwise lawfully usable evidence in court.

Where co‑determination applies in investigations

The German Works Constitution Act (Betriebsverfassungsgesetz - BetrVG) grants the works council binding co‑determination in several investigation‑relevant fields.

Monitoring capable systems and tools: Section 87(1) no. 6 BetrVG requires works council co-determination for the introduction and use of any technical device capable of monitoring employee behaviour or performance. The Federal Labour Court (BAG) interprets this requirement broadly:

• A supervisor “listen-in” headset qualifies as a monitoring device even without recording; both its introduction and use are subject to co-determination.
• Employer email systems, and the software components enabling email communication, fall within the scope; both implementation and ongoing use require co-determination.
• Even a corporate Facebook page that allows visitor posts about employee conduct may constitute a monitoring device.
• By contrast, an ad hoc use of a route planner to verify a single mileage claim does not trigger co-determination where there is no element of systematic or ongoing monitoring.

Staff questionnaires and assessment criteria: Section 94 BetrVG subjects staff questionnaires and assessment principles to works council consent; absent agreement, the conciliation committee decides. The BAG clarified in 2024 (docket no. 1 ABR 31/23) that the mere use of unapproved questionnaires does not, on its own, justify refusing consent to a personnel measure under § 99(2) no. 1 BetrVG. Objections must instead fall within the specific grounds enumerated in § 99.

Planning of technical installations and work processes: Section 90 BetrVG requires employers to inform and consult the works council at an early stage on plans for new technical installations and work procedures, expressly including the use of artificial intelligence (AI), so that the council’s proposals can be meaningfully considered.

System-level responsibility in groups: Where monitoring-capable systems are introduced across a corporate group, competence may lie with the company works council (Gesamtbetriebsrat).

Information and consultation duties during a running investigation

The works council has extensive information and support rights, which must be carefully balanced against confidentiality and data-protection requirements. Section 80 BetrVG defines the works council’s general duties and the corresponding employer obligations to inform and support it.

A clear distinction should be maintained:

• At the system level, the works council must be informed and consulted on the introduction and configuration of monitoring-capable systems under §§ 87 and 90 BetrVG.
• At the case level, the employer should provide only the information necessary for the works council to perform its statutory functions (e.g., under § 102), while minimising disclosure of unrelated personal data and safeguarding whistleblower confidentiality.

Any disclosure of personal data to the works council constitutes “processing” and must be justified by a valid legal basis and necessity (see Part V of our Series).

Co‑determination on individual measures after the investigation

Personnel measures taken following an investigation trigger additional, and often stringent, participation requirements.

Hiring, grading and transfers

Before any hiring, classification, reclassification or transfer, the employer must inform and obtain the works council’s consent (§ 99 BetrVG). Non-compliance can result in court-ordered rescission and fines, including in urgent cases under the statutory fast-track procedure.

Dismissals

The works council must be heard prior to any dismissal, and the employer must set out the grounds in sufficient detail. A dismissal issued without this hearing is void.

Quick checklist: personnel measures

✓  Identify the contemplated measure and assess § 99 applicability; prepare a complete § 99 information package, including reasons and supporting documentation.

✓  For dismissals, draft a § 102 hearing letter that mirrors the facts underpinning the intended notice and diarise statutory response periods.

✓  Maintain a clear separation between fact-finding and decision-making (see Part III and Part V of our Series).

What to share, when to involve, and how to maintain confidentiality

Cooperation with the works council is most effective when roles and limits are clearly defined.

Involve the works council at the earliest planning stage of any monitoring-capable tool or material modification (e.g., email archiving, IT forensics, “listen-in” functionalities, CCTV, AI-supported analytics). Provide a structured overview covering purpose, scope, access concepts, retention periods, audit mechanisms and data protection considerations. The framework should be formalised in a works agreement incorporating GDPR safeguards (see Part V of our Series) and operational controls (see Part IV of our Series).

Where the investigation framework relies on standardised questionnaires or evaluation criteria, obtain works council consent under § 94 BetrVG prior to implementation.

• Provide information only insofar as necessary for the works council’s statutory involvement. When transitioning from fact-finding to personnel measures, ensure that § 99 and § 102 submissions are concise, coherent and factually substantiated.
• Safeguard the identity of whistleblowers and third parties unless disclosure is legally mandated and proportionate.
• Use redactions and summaries to protect the rights of third parties, in line with GDPR Article 15(4) (see Part V of our Series for details on data-subject rights management).

Avoid common pitfalls

⇒ Do not introduce or operate monitoring-capable systems without complying with co-determination requirements; this exposes the employer to injunctive relief and conciliation proceedings.

⇒ Do not omit or inadequately conduct the dismissal hearing; dismissals issued without proper consultation are void.

Consequences of non-compliance

The legal consequences of breaches of co-determination obligations vary by context but are typically manageable if addressed promptly and in a structured manner.

• Systems and monitoring

Where monitoring-capable systems are introduced or used without complying with § 87 BetrVG, the works council may seek injunctive relief requiring cessation and proper implementation of co-determination procedures. The Federal Labour Court (BAG) has clarified that, while such a breach gives rise to a “removal claim” eliminating the unlawful situation, it does not necessarily reverse all effects already produced.

• Personnel measures

The implementation of personnel measures subject to § 99 BetrVG without the required consent may result in court-ordered rescission and administrative fines under § 101 BetrVG. In urgent cases, the procedural requirements of § 100 BetrVG must be observed. A dismissal issued without the mandatory prior hearing of the works council under § 102 BetrVG is invalid.

• Use of evidence in court

A breach of co-determination obligations does not, in itself, result in a general exclusion of evidence. The Federal Labour Court (BAG) has clarified that the parties to a works agreement (employer and works council) lack the authority to establish evidentiary or submission bans that go beyond the procedural framework of the Code of Civil Procedure (ZPO).

In its judgment of 29 June 2023 (2 AZR 296/22), the BAG held in particular that:

“works agreements cannot create independent rules excluding evidence in judicial proceedings”.

• Operational change implications

Where investigation findings lead to an “operational change” (Betriebsänderung) within the meaning of § 111 BetrVG, failures in consultation and information may delay implementation, increase litigation risk and strengthen the works council’s position in negotiations, particularly with respect to an enforceable social plan.

Conclusion

Effective alignment of internal investigations with co-determination requirements is a matter of disciplined execution. It requires a clear separation between system governance and case-specific decisions, combined with timely and legally precise involvement of the works council.

The statutory regime follows a straightforward logic: co-determination applies at the system level (in particular for monitoring-capable tools), while defined participation rights govern the implementation of individual personnel measures and dismissals, with enhanced protection for works council office holders.

Non-compliance entails tangible procedural risks but does not, as such, result in an automatic exclusion of evidence. Admissibility is instead assessed on a case-by-case basis, applying a proportionality test that balances the employer’s enforcement interests against the employee’s fundamental rights. The decisive distinction remains that between transparent, proportionate measures and intrusive, disproportionate forms of monitoring.