(1) At undertakings bound by a collective pay agreement, the employer and the elected representatives of the employees may establish staff rules by written agreement. If such an agreement is binding upon a majority of the employees, the employer may make the staff rules applicable to all employees in the sectors of work covered by the agreement.(2) When the provisions of the first paragraph are not applied, staff rules are not valid unless approved by the Labour Inspection Authority. Rules shall be drafted by the employer, who shall negotiate with the employee representatives concerning the provisions of the staff rules. In the case of undertakings bound by a collective pay agreement, the employer shall negotiate with the employees' elected representatives. Otherwise, the employees shall appoint five representatives with whom the employer shall negotiate. If divergent rules are proposed by the employees' representatives, such rules shall be enclosed with the draft submitted by the employer for approval. If the employees' representatives fail to negotiate concerning the rules, this shall be stated by the employer when he submits the draft for approval.(3) The staff rules shall be posted at one or more conspicuous places in the undertaking and be distributed to each employee to whom the rules apply.