Germany: Matrix managers with multiple voting rights – Federal Labor Court widens leeway for works council elections

Matrix structures have long been a reality in many companies. Employees are managed across different sites, with the manager based in a different place – for example, working remotely – or employed by another company within the group. In a recent ruling dated 22 May 2025 (Ref. 7 ABR 28/24), the Federal Labor Court (Bundesarbeitsgericht, BAG) has clarified that matrix managers may be eligible to vote in works council elections in several locations under certain conditions. This clarification has significant practical implications.

What are matrix managers?

Matrix managers are managers in a matrix organization, i.e. in an organization in which employees report to different management structures at the same time. This means:

• Reporting to at least two managers: In a matrix organization, employees typically report to at least two managers, e.g. the disciplinary manager (e.g. department head) and the technical manager (e.g. project manager).
• Technical and disciplinary management: Matrix managers are usually responsible for the technical management of projects or tasks. They coordinate the cooperation between different departments, while disciplinary management (e.g. personnel development, holiday approvals) is the responsibility of another manager.
• Complex coordination: Since employees in a matrix organization deal with several points of contact, this requires efficient communication, clear responsibilities and coordination of targets.

In summary, matrix managers bring together specialist expertise and take on control at several levels in order to drive forward cross-departmental projects.

What is the background to the decision?

An IT company set up a total of five organisational operating units, with work being carried out across departments in teams led by matrix managers. Although these were formally assigned to a different ‘parent company’, they were included in the electoral roll of another location. The employer then challenged the works council election.

What was the decision of the lower court?

The lower court (Baden-Württemberg Regional Labour Court (Landesarbeitsgericht (LAG)), decision of 13 June 2024 – 3 TaBV 1/24) declared the election invalid.

Although managers who work with the employees in the company and actually exert their authority to issue instructions are integrated into the company, this is nevertheless irrelevant to the question of eligibility to vote. The right to vote ensures that only those whose interests are actually represented by the works council are entitled to participate in decision-making through the works council.

What did the BAG decide?

The BAG overturned the decision of the LAG Baden-Württemberg and referred the legal dispute back to the lower court for further clarification. A final decision is therefore still pending. Nevertheless, the BAG emphasized that multiple integration and thus the right to vote at several company locations is possible.

Whether multiple integration exists in a specific case must be examined on the basis of the actual operational structures. According to the BAG's decision, managers who are not senior executives within the meaning of Section 5 (3) of the Works Constitution Act (Betriebsverfassungsgesetz, BetrVG) may be eligible to vote in several companies, provided that they are integrated into the organizational structure of each of these companies. This means that managers who lead employees in different companies can also exercise their voting rights multiple times.

What are the consequences of this decision?

The BAG's decision has been met with a lot of criticism. Here are some of the negative consequences for employers:

• Impact on the structure of works councils: If matrix managers can vote in multiple companies, they can influence the structure of different works councils. This also leads to disproportionate representation of the interests of matrix managers in the general or group works council.
• Violation of the basic idea of the BetrVG: The basic idea of the BetrVG is that employees belong to only one company and can only vote in that company. The principle of ‘one man, one vote’ enshrined therein is disregarded and at the same time leads to employees being disadvantaged and underrepresented compared to matrix managers because they are only allowed to vote in one company.
• Impact on eligibility: A matrix manager who is eligible to vote in several companies could also be eligible for election in several companies. The background to this is that eligibility for election under Section 8 BetrVG is determined in accordance with the eligibility to vote under Section 7 BetrVG.
• Unclear responsibilities: If the manager is integrated into several companies, the question arises as to which works agreement the matrix manager is subject to in each case or which works council would have to be involved in the dismissal of the matrix manager.
• Impact on thresholds: The number of eligible voters also determines the size of the works councils. If certain thresholds are exceeded, more works council members will have to be elected. This increases costs for employers, e.g. through training and time off for works council members.
• Impact on the 2026 works council elections: The BAG's decision raises many questions for the upcoming works council elections in spring 2026. Election committees are now forced to plan ahead and across companies.

What can you do as an employer?

• Identify multiple integrations: Clarify which managers may be working in more than one company.
• Adjust voter lists: Ensure that every person eligible to vote is registered in all relevant companies and that the voter lists are adjusted accordingly.
• Minimize risk through early clarification: Document your organizational structures to avoid subsequent challenges to the works council elections.

In companies with complex, matrix-like organisational models or virtual team structures, it is now even more important to ensure that the allocation of employees to the relevant company is clearly defined and documented. If you are uncertain about matrix managers or the organisation or planning of your works council elections, we will be pleased to support you in developing a legally compliant implementation strategy.