Its creation can be forced by a vote of the employees and the council has a legal special status. This probably comes as a reaction to multiple distribution centers around Germany doing exactly that and forcing the creation of local work councils with the help of unions.
It's a common thing in German companies of all sizes and usually a good thing for the company too because problems between management and workforce are usually solved in a much less "confrontational" way compared to full-blown unionization (especially in smaller family-owned "Mittelstand" businesses).
Unions and Works Councils are not mutually exclusive. All companies that have a recognized Union will have a Works Council too.
A Works Council is entirely company specific. A Union is usually concerned with an entire sector and deals with company-specific issues only a limited way. In practice the Union organisations often provide assistance and advice to a Works Council, even to companies in which they are not active as a Union.
Its creation can be forced by a vote of the employees and the council has a legal special status. This probably comes as a reaction to multiple distribution centers around Germany doing exactly that and forcing the creation of local work councils with the help of unions.