An AI operational change can affect many employees — from the switch to new software to the full automation of entire departments. The Higher Labor Court of Cologne has now specified, in a ruling dated August 31, 2026 (9 TaBV 38/26), which topics a conciliation board may actually negotiate. For affected employees, this is an important signal: your rights to co-determination and mitigation of economic disadvantages remain intact, but the boundaries are clearly drawn.
In this article, you will learn what a conciliation board is, how the specific case of a railway company was decided, and what consequences arise for your personal situation if your employer is also planning an AI operational change.
What Is a Conciliation Board and When Is It Used?
A conciliation board is a works-constitution body that mediates when the employer and the works council disagree. It is required whenever the operating partners cannot reach agreement on a matter subject to the works council’s co-determination rights. Typical examples include the introduction of social plans, the regulation of working hours, or the implementation of operational changes.
The conciliation board consists of a neutral chairperson — often a labor judge — and assessors from both sides. Its task is to achieve a binding agreement. If no agreement is reached, the board can decide by binding award. This award then replaces the missing consent of the works council.
The establishment of a conciliation board can be applied for at the labor court if the operating partners cannot agree on a chairperson. The court then appoints the chairperson and defines the mandate — i.e., the specific topics that may be negotiated. Precisely this mandate was the subject of the current ruling.
The Case: AI Operational Change at a Railway Company
In the case decided by the Higher Labor Court of Cologne, a private railway company with around 1,250 employees, operated as a joint enterprise, planned the dissolution and merger of organizational units, fundamental changes to areas of responsibility, and the deployment of new IT systems and modules. As a result, numerous dismissals for operational reasons and transfers were to be issued.
The works council had been negotiating a reconciliation of interests and a social plan with the employer since late November 2025. After negotiations were declared failed on June 3, 2026, the employer applied to the Cologne Labor Court for the establishment of a conciliation board. The works council, however, wanted the mandate to also cover the planned introduction and use of the AI system itself. The labor court rejected this, and the Higher Labor Court of Cologne confirmed that decision with its ruling of August 31, 2026.
Why the Mandate Cannot Be Extended to AI Systems
The Higher Labor Court of Cologne made clear: the mandate of a court-appointed conciliation board cannot, against the will of one operating partner, be extended to the introduction and use of the AI system itself. The reason lies in the statutory system of the Works Constitution Act. The conciliation board is competent only for regulating the consequences of an operational change — i.e., for the reconciliation of interests and the social plan — but not for the question of whether the operational change is carried out at all.
The decision whether and how an AI system is introduced falls within the employer’s entrepreneurial freedom. The works council does have co-determination rights regarding the design of work processes and data protection, but these rights are governed by other provisions (e.g., § 87 BetrVG, § 97 BetrVG). They cannot simply be packed into the mandate of a conciliation board for a reconciliation of interests.
The court emphasized that the mandate must be clearly defined. If the works council wants to negotiate the AI introduction itself, it must do so through the regular co-determination channels — for example, via a separate conciliation board under § 87 BetrVG. Mixing it with the reconciliation-of-interests procedure is not permissible.
What Does This Mean for Employees?
For employees affected by an AI operational change, this ruling initially means a clear separation: you have a claim to negotiations on a reconciliation of interests and a social plan, but not to a discussion about the technology itself. That may sound disappointing, but it is legally consistent.
In practice, this means: your works council cannot prevent an AI system from being introduced — but it can ensure that the consequences for you are cushioned. This includes severance payments, qualification measures, transfer regulations, or social selection criteria. The social plan is intended to compensate for the economic disadvantages arising from the operational change.
If you are therefore threatened with dismissal or transfer, you should not rely on preventing the AI introduction. Instead, it is important to secure your claims to severance and social plan. A dismissal protection action can help negotiate a severance — as also becomes clear in our article on dismissal protection at VW.
Reconciliation of Interests and Social Plan: What to Watch For
The reconciliation of interests regulates whether and how the operational change is implemented — e.g., which departments are merged and how many positions are eliminated. The social plan stipulates what compensation and mitigation measures the affected employees receive. Both are negotiated in the conciliation board if no agreement is reached.
As an affected employee, you should keep the following points in mind:
- Check whether your works council was properly involved. Without proper involvement, a dismissal is often invalid.
- Inform yourself about the planned measures and demand the reconciliation of interests.
- Document your personal economic disadvantages — e.g., due to commuting times, loss of income, or loss of allowances.
- Seek advice on what severance amount is realistic. There is no flat-rate formula, but the social plan often references length of service and age.
Note: Severance is not a guaranteed claim. It depends on the negotiation outcome. Only if the employer expressly offers a severance under § 1a KSchG in the dismissal letter do you have a statutory claim — otherwise not.
Legal Support: When a Lawyer Is Worthwhile
If you are threatened with a dismissal for operational reasons, you should act quickly. The deadline for a dismissal protection action is only three weeks after receipt of the dismissal. A specialist lawyer for labor law can examine whether the dismissal is socially justified and whether a severance is negotiable.
RechtStark is not a law firm, but a litigation funder. We cover the costs of your dismissal protection proceedings if your action has sufficient prospects of success. This means you take no financial risk. Further information on the costs of a dismissal protection action can be found in our article on the planned reform of dismissal protection.
Even though the conciliation board may not negotiate the AI introduction itself, the social plan remains a central instrument to offset your disadvantages. Seek advice early on which claims you can specifically assert.
Conclusion: Your Rights in AI-Driven Changes
The ruling of the Higher Labor Court of Cologne shows: in an AI operational change, you as an employee have clear rights to co-determination on the consequences — but not to prevention of the technology. This is not a disadvantage, but a sensible separation between entrepreneurial freedom and employee protection.
If your employer is also planning an operational change with an AI component, you should stay alert. Follow the negotiations between employer and works council, and secure legal assistance in good time. A dismissal protection action can not only save your job but also achieve a higher severance — especially if the social plan is unfavorable for you.
RechtStark supports you in financing your proceedings. We assess your prospects of success and cover the costs if your action has a chance of success. This allows you to enforce your rights without worrying about legal fees.
Note: This article is for general information purposes only and does not replace individual legal advice. For a free initial assessment of whether litigation funding may be an option for your case, you can contact RechtStark.