Summary Industrial organization in context (Martin)
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Summary Conflict management and Industrial Relations
Deze samenvatting van Bomers & Peterson is gebaseerd op het studiejaar 2013-2014.
Part 1: The employment relationship
Introduction
T: Industrial Peace is a basic idea and goal of Conflict Management.
T: Why should we compare Industrial relations among the countries?
- Scientific goal: science is interested in explaining differences/similarities among countries/systems, their effects and development throughout time.
- Policy goal: countries try to learn from each other. It is seen that “borrowed” developments have taken place within countries (path dependency) and international institutions show “complementarity”. Often, however, transplantation of institutions does not work out well or institutions have to be adapted to the new national environment.
Convergence à countries becoming more similar
Divergence à countries becoming more different
Convergence of divergence à the differences among countries become similar.
Total convergence of countries is unlikely because of political, cultural, social and ideological differences.
Comparative employment relations: describing and analyzing two or more countries. International employment relations explore institutions across national borders.
A: Lewin (2001) in his article provides perspectives of the Human Resource and the Industrial Relations view on workplace conflict.
HR view about employment relationship conflict: originates from poor management within company, but can be reduced using innovative, cooperative, mutual gains-oriented, and problem-solving methods to unify employer–employee interests. According to this view, as management improves, conflict will disappear and employees and employers will basically have the same interests.
IR view about conflict: originates from employer–employee power imbalance (e.g. possession of assets makes it probable and possible for exploitation to occur (E – W)); conflict is enduring; conflict often requires institutional interventions in the forms of unionism and legislation to correct the power imbalance, and can be constructive even when the conflict is dealt with in adversarial, non-problem-solving fashion.
This course focuses on the Industrial Relations view.
A: The employment relationship can be seen as relationship between employer and employee including both cooperation (in order to produce goods and services) and conflict (raising when deciding employment conditions: roles and responsibilities as well as how to divide economic return acquired) between the two actors.
T: Employment Relationship or Industrial Relations (IR) = interdependance + fundamental conflict of interests:
E – gross W (E = effort; W = wage/rewards)
- Employers’goal in IR is to maximise difference E – gross W
Means: machinery, deskilling, move production knowledge from worker to manager (Taylor), threat of firing, work intensification
- Workers goal in IR is to minimise difference E – gross W
Means: strike, work-to-rule, negotiation, find other work
Contract is indeterminate (no productivity level specified in advance, normally only the wage), hence continuous struggle between both parties about effort and reward. Productivity can be manipulated by employer (e.g. through management tactics: “use the stick”, “use the carrot”).
B:It is highly complicated to compare countires on the same levels because of difference in concepts and equivalents:
- Phenomenal equivalence: the same measures are used for the same concepts, regardless of the context.
- Conceptual equivalence: different measures are used for the same concept, depending on the difference in context. à should be used for effective conceptual equivalence.
VoC (Varieties of Capitalism-approach of Hall & Soskice, 2001). The differences among countries will be compared using VoC as a framework for comparative analysis (it is applies to OECD countries).
Please see attachment chapter 1.
- Liberal Market Economies (LMEs): countries in which firms rely on hierarchies and markets to solve the coordination problems they have. Characterizations of LME’s are:
- Well-developed capital markets
- Outsider forms of corporate governance: shareholders and the stock market are important
- IR relies on market mechanizm
- Employment-at-will (low employment protection)
Countries:
- US
- UK
- Coordinated Market Economies (CMEs): countries in which firms make use of non-market mechanisms to resolve coordination problems internally and externally. Characteristics of CMEs:
- Patient forms of capital
- Insider corporate governance
- IR based on bargaining
Countries:
- Japan
- Germany
- France
- Denmark
- Italy
In the ‘70’s and ‘80’s national patterns of employment relations were diverging. After the long boom (economic growth after WWII) the ‘70’s consist of increasing conflict between employers and employees. There were two patterns: countries like Germany tried to increase economic growth through corporatist policies (centralized negotiations between employers and unions) and countries like US by collective bargaining. This tendency created dualism in employment relations in these countries.
A: At the end 20th century, more cooperation-oriented HR perspective started to dominate over conflict-oriented IR for research and practice. In this regard, the decline of private sector unionism in the US and elsewhere is a key datum.
Country comparison on Employment Relationship:
| UK | USA | Italy |
E-W Effort: working hours, vacation,work intensification, productivity, taylorism.. Rewards: wage, overtime pay, hourly wage rate, wage cuts, pay in kind...
|
| T: From 1900 onwards Taylorism (p. 63); ‘scientific’ instead of power-based (p. 63). Relatively large low-wage sector (p. 79) 2000s: polarization of income (p. 73/82).
| B: Does not fall clearly into CME or LME (p 138).
B: IR is chaotic, poorly institutionalized and not mature compared to other countries (p138).
|
Commodification presence of welfare state, unemployment insurance, pension/retirement plan, health insurance, disability insuranc.. | B: 1999: minimum wage, working time regulations, equal opportunities etc. So recent shift from voluntarism to juridification (p45).
B: Employment security is affected when work is transferred from a client to a supplier in case of network organizations (p57).
| T: Unemployment compensation (p. 69-70), retirement (p. 70/74); minimum wage (p. 69); health costs (p. 74) (meaning: transfer payments low). See also fringe benefits (p. 72), and the important role they play in the US: strikes in 2003-04 and 2007 (p. 74). | B: Hot autumn: Metal federations pushed high wages, limited overtime, internal mobility etc. (p142). |
| France | Germany | Denmark |
E-W Effort: working hours, vacation,work intensification, productivity, taylorism.. Rewards: wage, overtime pay, hourly wage rate, wage cuts, pay in kind
| B: flexible working hours, unemployment insurance, occupational health and safety etc. (p180)
B: 35-hour workweeks (p182). | T: No minimum wage, development is now coming. Therefore bargaining coverage is lower. In Germany wages are lower in flexible sector. | B: Flexicurity, but with high flexible dismissal (p224). |
Commodification presence of welfare state, unemployment insurance, pension/retirement plan, health insurance, disability insuranc.. | B: No specific welfare benefits (p176).
B: High state intervention in employment relations. This is why there is an unwilling of the employers and unions to voluntary collective agreements (p180).
B: National minimum wage, minimum integration income, jobs for young people program (p181).
B: Works council can create health, safety and improvement of working conditions committees, which are compulsory for companies with over 50 employees. | B: A developed welfare state: employment insurance, health insurance, pension schemes. (p.197)
Nevertheless depending on employment type(typical or atypical); no minimum wage because of large bargaining coverage, but now necessary as demanded by UE (215), also because of rising atypical employment (218)
| B: Social security in terms of unemployment is high in Denmark. However hiring and firing is flexible (p224). Flexibility is the same as in UK.
B: The welfare system is controlled by the unions instead of the public authorities (p227).
B: 1989: occupational pension schemes (p241).
|
| Japan | China | India |
E-W Effort: working hours, vacation,work intensification, productivity, taylorism.. Rewards: wage, overtime pay, hourly wage rate, wage cuts, pay in kind
| B: 1987: Legal limit of weekly working hours to 40, but a quarter works more than 60 hours (p.254).
B: Wage depends on time in the company, and has a certain limit. Promotion is based on length of service. It is therefore difficult to switch employer (p.258).
B: Relaxation of the labor market regulation: temporary work. The maximum duration of employment contracts have been relaxed from one till three years (p. 267). | B: Effort (324/325):In generel work intensification,rising working hours; for urban workers about 47 hours to 50 hours; rural migrant workers (informal sector!) have to work more (discriminated); especially in sweatshop manufacturing plants and private enterprises: extensive hours beyond 60 (lot of rural migrant workers work there); more hours also for professionals and managerial workers --> health problems, retention issues --> some employers try to introduce Employee assistance Programs (But note: only for professionals and managerial workers)
| T: Stock capitalization of firms is low. Employment security is high.
B: Large difference between organized and non-organized sector (p.349). |
Commodification presence of welfare state, unemployment insurance, pension/retirement plan, health insurance, disability insuranc..
| B: Higher protection of regular employees than non-regular employees. The reason is that regular workers are more committed to the company à Lifetime employment (p.258).
B: Retirement age is in most companies fixed at 60 years. Legislation determines that since 2005 employers could offer employment up to 65 years (p259). | B: Employment security is ended and workplace welfare provision is reduced. These changes have ended the paternalistic bond between employer and employee. Only Well-performing SOEs continue to adopt paternalistic management style (p.313). | T: High employment security. (P.330)
B: training, health services, social security (p.349). |
Part 2: Industrial Relations systems
L = organized labor
C = (organized) capital (capital automatically obtains power because of its role in the employment relationship – it does not neccesserily need to be organizedto have power, while labor is only powerful when it is organized).
The type of IR system depends on:
- Degree of Separateness between C and L;
- Extent of calculation of the relationship;
- Conflict costs;
- The power of organized labor (L’s ability to gain concessions from C);
- C and L’s level to act strategically, with central leadership able to commit memberships to a course of action.
A: Crouch (1994) distinguishes 2 models to analyze IR systems: Variation in Social Exchange and Varieties of Industrial Relations Systems.
1. Variation in social exchange depends on 2 variables: degree of separateness and extent of calculation.
- Degree of separateness: ranges from alienation to identity = from being strangers (high distance) or having a hostile relationship, to being so close that two actors experience the same self-identity.
- Extent of calculation: ranges from absence of contract to pure contract. The place is determined by the extent to which actors make arrangements to conduct the relationship (also related to the level of trust between the actors).
- When two actors move away from alienation, the degree of contract will first rise and then decline.
- Trust is based on the extent of claimed shared interests.
- Frequent interactions can produce a need for contract because trust can be built on the bases of experience.
2. Varieties of Industrial Relations Systems depends on power of labor and ability of both L and C to act strategically.
Levels of bargaining/ IR systems:
- Contestation à generally would be seen zero-sum game (one gains at the expence of the other), characterized by low trust, sporadic and hostile interaction. However because of high conflict costs it is more accurate to see contestation as negative-sume game – one accepts losses in the meantime, hoping for gains/improvement of the situation after the conflict ends.
- Pluralism: interaction is more frequent and less hostile, so trust level gets higher and lowers the conflict costs. This way relations become more continuous, conflict more regulated. The roles of representatives and contracts become more important and better regulated (more discipline) à Positive-sum game: win-win situations where both parties benefit from relationship. However, the structure of IR is rather fregmented and not centralized (p.38). Personal contacts (“old-boy-networks”) are present and vital.
- Bargained corporatism/Neo-corporatism à Employers try to find ways to minimize the sacrifice from their part if not totally avoid it. This creates unbalance in the relationship’s exchange and raises a conflict (zero-sum game). However, reaching mutual agreement is still better for both parties to join interests, than calling the bargaining off and encountering high conflict costs, therefore it is a positive-sum game. Representatives and contracts are important, procedures are regulated, institutionalized.
- Authoritarian corporatism: It is not really a form corporatism, because it does not make use of organized groups. It is however seen as normal form of IR system used by capitalists (especially USA) in the absence of powerful unions. Use of L is not made because C is powerful enough to mute L’s voice.
Bargaining levels: National, Industry, Company/Plant.
T: Conflict of insterest is generally seen as zero-sum game However, conflicts are expensive, thus it can be assumed to be a negative-sum game.
IR conflicts costs can be decided considering the following factors: number of participants, duration of conflict, weapons used, negative effects on 3d parties (e.g. suppliers, society).
- Conflict costs for C: customer, supplier problems leading to their loss;
- Conflict costs for L: Job loss, family problems;
- Conflict costs for both C and L: Hiring attorneys or consultants, bancrupcy, loss for third parties.
Levels of conflict:
- Conflicts of rights concern the interpretation of existing contracts.
Can be divided into:
- individual disputes
- collective disputes
- Conflicts of interest arise during collective bargaining about a new agreement.Country
County comparison on IR systems:
| UK | USA | Italy |
Degree of separateness between actors/trust
presence of trust,
| B: Since 1980: employee involvement by downward communication, upward problem-solving, task participation and financial involvement (p51).
B: 1997: racial discrimination due to massive immigration. (p53). Under-represented females. Workplace bullying and harassment. From 1997 Social chapter (p54). | T: Vigorous repression of unions, continuous vigorous opposition (p. 63), company unions (p.64), also p. 76; 1920s Taylorism ((p. 63) no power but science). union avoidance CoC and NAM; consultants, law firms, HRM (p. 65); anti-union litigation (p. 65) ‘adversarial nature of US collective bargaining’ (p. 75) 1980s: striker replacements (p. 80) Aggressive management behavior (p. 74).
| B: Unions appealed to Italian workers to reject an agreement about senior-based retirement. This however was approved by the workers by an overwhelming proportion (p154).
B: Mistrust between unions and government (p154). |
Extent of calculation
Utilitarian attitude, opportunism | Employers were organized with often one goal: cost-reduction, so they had a pragmatic/opportunistic goal.
| High on plant/firm level. |
|
Conflict costs
determined by weapons used, duration of conflicts and number of conflicts, number of participants, external effects (3rd parties)... | ->Strikes conducted without an official ballot of the union membership, as is required, do not enjoy the same legal protections as recognized union strikes, and may result in penalties for the union members who participate or their union. There was also a change in the reasons for strikes (p.40): 'defensive strikes' were more seen as prominent in the 1990s.
| ->grievances-> arbitrage/getting supprt from 3d parties-> strike
-> conflict costs are mostly high for employees since strikes don't usually end under their term and softer weapons do not really work either becasue employers can legally ignore them without facing any conflict costs. Although the number of conflicts level and amount of participants is decreasing it's still generally very high.
| 1986 'Hot Autumn' massive wave of strikes, after unions gained importance in the 60's, lead to improvements, Highest level of industrial conflicts among industrialized countries around 1974 (142)
|
Power of labor
union density, heterogeneity within employees as group, heterogeneity within a trade union, duration union membership/turnover, closed/union shop system, Ghent system... | Since the unionisation was ineffective and there was anti-union legislation the influence and power of labour is considered low.
| Heterogeneity is high in local levels. Closed-shop union illegal.
| 50's: very weak trade unions and collective bargaining centralized at national level. 3 major union confederations CGIL, CISL, UIL and other organizations that claim to represent worker (unreliable dat about those, might double unionization rate if trusted)
|
Ability to act strategically
can be analyzed per group as whole (employers/workers) but also per organization (employer organization or labour/trade union)
| 1906 Trade Disputes Acts; a laissez-faire approach to regulation was supported by the state by both unions and employers. However since the 1970s and 1980s this changed by actions of the state: 1971 Industrial Relations Act --> to weaken ability of workers to strike. 1979 Margaret Thatcher's conservative government: smashed the unions, this was the point in history transition away from traditional voluntarism towards a neo-liberal interventionist state. Following anti-unions acts by this government; limit ability of unions to organize lawful industrial action, narrowing traditional union immunities from legal action, outlawing secondary strike action, imposing a secret ballot prior to industrial action, prohibiting closed-shop and removed union recognition, so these actions makes it much more difficult to consolidate and extend membership as unions. However, we seen many Blair's government implemented later on some employment rights as minimum wage etc.
| T: Unions have clear idea about their goal (p. 66), and about means (p. 66); so do employers (NAM) (p.65), mostly strategy per firm.
Shortly: C's - high, L's low, since labor regulations an laws are basically on C's side or they can easily be ignored since not all collective agreements are legally binding. That's decided more on plant level.
| B: Since 1992 new type of corporatism, with social partners in all types of policies. However, there are not many significant outcomes. The reason is the tripartite agreement of 1993 (p160).
B: The strength of the union had been declining for several years (p163). |
IR system level presence of representatives and discipline, presence of regulations (peace obligation, dispute resolution, mediation, arbitration, conciliation, grievance procedure...), presence of tripartite committees, intertemporal sacrifices and gains, agreements on different topics (e.g. wage vs codetermination). | There is not that much bargaining so it can be assumed there is a pluralism (but contestation can be argued as well), p.47: 'successive governments have sought to distance themselves from the direct settlement of particular industrial disputes, through their influence as an interested party in the public sector is still important'.
| Neo-corporatism with weak labor mixed with authoritarian corporatism, because unions are there and they are very active however not powerful enough to make C negotiate mostly. | neo-corporatism deals seemed to be unlikely due to the lack of organizational and institutional structure (151), tripartite agreement in 1992: abolition of wage indexation (= binding wages an index to compensate inflation) and ban of enterprise-level bargaining (152), 1996 tripartite 'Pact of Labor': flexibilisation of rules for flexible and contingent labor, 1998: 'Christmas Pact': confirmed collective bargaining structure on two levels, corporatist system on way to institutionalization at the end of 90's (153), Italian corporatism way involves all social partners but does not bring typical decommodifying outcomes (160)
|
| France | Germany | Denmark |
Degree of separateness between actors/trust
| B: Traditional lack of recognition between social partners (p171). Employers have opposed any union influence and used paternalistic practices. But, this has slowly changed over time (p177). | B: 1980: German model à strong unions and employer organizations negotiating compromises. (p196) àDual system: co-determination at the work place and collective bargaining at industry level. (p212)
T: In past high trust because dual system. Calculation is growing, trust is now declining. (More shifting towards USA system)
| B: Self-regulation is possible with the condition that employees’ and employers’ organization create joint solutions to the political system à consensus principle (p228).
B: Strong relations at the central level and the enterprise level: a great network of shop stewards, union branches and cooperation committees to secure effective implementation of agreements (p229). |
Extent of calculation
Utilitarian attitude, opportunism |
|
| The labour force participation rate in Denmark is high, and at more than 80 % of 15- to 64-year-olds, it is among the highest in the OECD countries.
|
Conflict costs
determined by weapons used, duration of conflicts and number of conflicts, number of participants, external effects (3rd parties)... | Strikes were permitted in 1864, but only since 1884 unions became legal. Right to strike is guaranteed by the French Constitution. Public-sector unions have to give 5 days' notice before a strike, but little legal regulations for private sector (188). A strike is legally defined as 'stoppage of work', other actions (industrial sabotage, working-to-rule, lock-outs etc) are illegal. Sit-ins are permitted when the goal is to seek negotiation with employers (189). In 2007 an Act to minimise strikes in public transportation sector. There are elaborate procedures for the settlement of disputes (conciliation, mediation, arbitration), but there are rarely put into practice: unions have little money (190) Decline in the number of strikes, but now mostly work-to-rule and go-slow practices (191)
| B: low industrial conflicts (p.202,213) as there is a strict peace obligation while collective agreements are in place, conflicts normally industry wide within a certain regain (212), strikes and lockouts are legal instruments
| In recent time have been 4 major conflicts:
|
Power of labor
union density, heterogeneity within employees as group, heterogeneity within a trade union, duration union membership/turnover, closed/union shop system, Ghent system... | Low union membership leads to poor financial resources. but, they do have political and industrial influence (177)
|
| In economy terms, Denmark is greatly dependent on other countries. It is often characteristic of such countries that, lacking the ability to protect themselves through protectionist strategies, they develop internal coordination between the state, trade unions and employers in order to be able to adapt to external challenges. So power of labor might be assumed as high.
|
Ability to act strategically
| B: Workplace delegates (1936), works councils (1945), workplace union branches (1968) (p182).
B: In order to benefit from state support, unions are required to obtain a majority of votes at works council election or to be ratified by employees through a referendum (177)
| T: Heterogeneity à The bigger the company, the more diversity and power (p213). Also tacit escape à you do not have to apply to collective agreement (p211).
High per union, as they act on industry level, also high for workers through legally binding rights of works councils, an also on organization level (Business and trade association, chamber of commerce system)
| Ghent system
|
IR system level presence of representatives and discipline, presence of regulations (peace obligation, dispute resolution, mediation, arbitration, conciliation, grievance procedure...), presence of tripartite committees, intertemporal sacrifices and gains, agreements on different topics (e.g. wage vs codetermination). |
| Neo-corporatism as rights of the works councils legally guaranteed. Councils are mandatory but have to be formed on employees initiative. Germany has been according to the book (203) between corporatism and non-integrated pluralism (e.g. wage restraints only voluntary), Mediation agreements in all major sectors in industry (202) = mediation and arbitration is present,
|
|
| Japan | China | India |
Degree of separateness between actors/trust
| B: Separateness between regular and non-regular workers
B: Cooperative approaches to employment relations (p.255). | B: Separateness between rural and non-rural workers. | B: Crisis of confidence: trade-unions are co-opted in collective bargaining process by the government or by the management (p.342). |
Extent of calculation
Utilitarian attitude, opportunism | Lifetime employment system is based on trust, so low extent of calculation. For atypical workers fixed contracts, so high extent of calculation. After age of 60 (retirement), regular workers can get a fixed contract with lower wage until age of 65 due to ageing population
| Informal sector: majority has no written contract; they are willing to work overtime for no premium payment to earn more money --> so here no calculation doesn’t indicate something good, it is an indication of poor working conditions and payment, employer take advantage policy loopholes and hire and fire workers at will (322)
| The same as for China: informal sector: majority has no written contract; they are willing to work overtime for no premium payment to earn more money --> so here no calculation doesn’t indicate something good.
|
Conflict costs
determined by weapons used, duration of conflicts and number of conflicts, number of participants, external effects (3rd parties)... | Regular workers have a good relationship with their employer and can join a company union. A mean for L to enter a conflict is a strike. Right after the Second World War and also in the 1970s there were many strikes, but after 1974 the number of disputes and strikes decreased substantially. Nowadays, disputes are mostly settled directly between the parties, sometimes with the help of a third party, also because most disputes are about labor-management relations at the company level (265). Few disputes go as far as arbitration. So, mostly the employers and employees cooperate, which leads to lower conflict costs. Of course, this is again only for the regular workers.
| *3 levels of conflict resolution: mediation, arbitration, litigation --> rising number of conflicts --> higher costs *workers voice their grievances and seek justice through letters, petitions, workplace industrial action and street protests (ILLEAGAL)
| Not much is told about strikes in the book regarding India, however it becomes clear that political parties and trade unions work closely together. The Indian government prohibits strikes by unions. Unions react with political protest that paralyse cities (called BANDH), these protest are needed since collective bargaining is rare in India and employers/management and government are anti-unions. (p.346) The court even blamed one time workers of a telecom company for losses with less consumers. BANDH were illegal according the court.
|
Power of labor
union density, heterogeneity within employees as group, heterogeneity within a trade union, duration union membership/turnover, closed/union shop system, Ghent system... | First almost no unions, then from 1920-1930 no influence. After WW2 more unions. These are company based. However, decline of union density and union membership + only 1/3 of workforce is represented: so, power of labor is not very high for both regular and atypical workers. Regular workers have the possibility to join a company union, atypical workers cannot join a company union at all and thus have a very low power of labor.
| high unionisation level in state sector; much lower in private sector(30%); however high level of membership in unionised workplaces hasn't brought any real power, its more kind of mandatory to become member ; Union membership level in organizations where unions were established: over 90%
| Only 2% of of total workforce was participating in collective bargaining, but over 30% of informal sector are organized in collective bargaining (but that's only 2% of total workforce). So less than 5% is unionized of all workers. Trade unions were powerful from the past already since they cooperate with political parties against British colonism, however that resulted in a fragmented unions and political polarisation. The power of individual workers was low. Unions were dependable of political parties to gain power. Unions are also very heterogeneous with craft, occupational or employment category and even caste differences. Differs per industry. However we see also a free-rider effect (p.343), crisis of confidence between unions and members (are short term oriented and individualistic). Workers distrust the real power of fragmented unions to meet their expectations.
|
Capacity to act strategically
| There are unions for both employees and employers, so both C and L are able to act strategically. But: low union membership and union density, so the question is whether employees really can act strategically. Employer organizations mostly are focused on coordinating activities from members, so they don’t really act strategically either. Besides, atypical workers are not able to act strategically at all.
| Informal sector and private sector: resistance of union recognition, low density --> hard to act strategically, in addition rural worker in informal sector fear to get fired (no written contract)
| B: Problem: workers can choose a union to represent them without belonging to it, workers can be free-riders, unions can have collective bargaining rights without workers’ support and majority unions can be undermined (p.343). Since the fragmentation of unions and their dependence on political parties that were polarized to each other the strategic power and effectiveness of unions was limited.
|
IR system level presence of representatives and discipline, presence of regulations (peace obligation, dispute resolution, mediation, arbitration, conciliation, grievance procedure...), presence of tripartite committees, intertemporal sacrifices and gains, agreements on different topics (e.g. wage vs codetermination). | Pluralism for regular workers and contestation for atypical workers: Japan can be found somewhere in Case I in the model of Crouch, since in that case both L and C should have low ability to act strategically and the power of labor is low, which leads to pluralism and contestation with a stable relationship. As can be seen, there is a huge difference between regular workers and atypical workers. Therefore, there are two IR systems applicable to Japan. For the regular workers, this is pluralism. They are represented by their own company unions, which are responsible for protecting and defending their interests. However, for atypical workers this is contestation. They are not represented at all by any unions, so there is low trust between them and their employers.
| *kind of neo-pluralistic approach promoted by Chinese government and indicated by Chinese culture (326, 327)
| Pluralism as CM system; despite collective bargaining is rare, there were some wage boards by government to set wages and working conditions in some industries. However, employers prefer to decentralized bargain at the plant level, unions pushed bargaining at higher levels since they feel that plant level bargaining reduces their bargaining power (especially during crisis).
|
Part 3: Exit, Voice and Loyalty. Interest Group formation
Almost all societies have their own class-structures. Everybody has a need to belong to a group one shares number of characteristics. This need in turn leads to loyalty. A group becomes a social class when its members are homogeneous in terms of values, behavior or culture.
T: 3 dimensions to analyze interest group formation, summarizing both articles:
- Social distance: characterized by 2 elements: number and size of differences among society members à the larger the number and size of differences – the larger the social distance.
- The voice and exit dimension: exit is more used by LME countries (labor mobility); is more an individual reaction (p.66). Voice is more common option in CMEs (works council, grievance procedures); more informative and collective reaction.
- opposite of voice and exit is lock-in situation where one has no voice and/or no escape.
- Time dimension: within-generation situation; job security, pay stability, earnings’prospect over time (Goldthrope); marriage, labor market selection p.65 (dead-end jobs, delayering or job progression). Between-generation (intergenerational) situation: caste system, class lock-ins (can be seen in intergenerational mobility- the higher the correlation between father’s and son’s income, the more likely they are to belong in the same social class).
Lock-in over several generations creates group identity.
First two dimensions can be connected creating a societal situations depicted in part 2 (see e.g. degree of separateness). Adding a third dimension gives a model to be analyzed within capitalism in time.
A: Goldthrope (2004)
Next to the differences in class, there are differences among employees. This differentiation is noticeable in the employment contracts (p. 4)
Effect of Individuals’ class positions’ in employment relationships on their economic life:
- Economic security: risk of unemployment
- Economic stability: variability in earnings
- Economic prospects: lifetime earnings profiles
Economic security
People’s economic security can be influenced by social class, through risks like job loss and unemployment. Study findings mention an increase in job security since the 1970s. But class position, taken as a structural factor, is still of critical essence in vulnerability to employment. Routine worker has five times more odds to be long-term unemployed than a managerial employee. There is a clear link between class position and the incidence and length of unemployment. This however does not have to say anything about relative risks: professional and managerial employees are becoming a growing proportion of the total workforce. Wage-workers are generally less protected against insecurity, due to short periods of notice and less pretention of ill-health than managerial employees.
Economic stability
While economic security is considered to have long time influence, class has a more short time influence. This is the stability of earnings. Nowadays the stability of earnings is improved by better wages and conditions of employment and social security provision. The relative importance of variable pay differs between classes. Class differences do not show big changes in time. The salariat remains the salariat.
Economic prospects
This concerns the relationship between earnings and age. Clear class differences are noticeable.
Differences in class determine economic security, stability and prospects, not only in material welfare, but also regarding to the whole range of economic life-changes and risks/opportunities.
Correspondence of the Classes of the Goldthorpe Schema and of the NS-SEC Socio-Economic Classification and Common Descriptive Terms
Goldthorpe schema | NS-SEC | Common descriptive term |
| ||||
I | Professional, administrative and managerial employees, higher grade ab | 1 | Higher managerial and professional occupations ab |
Salariat (or service class) | |||
II | Professional, administrative and managerial employees, lower grade;b technicians, higher grade | 2 | Lower managerial and professional occupations b | ||||
IIIa | Routine non-manual employees, higher grade | 3 | Intermediate occupations | Intermediate white- collar | |||
IV | Small employers and self- employed workers | 4 | Employers in small organizations, own account workers | Independents (or petty bourgeoisie) | |||
V | Supervisors of manual workers; technicians, lower grade | 5 | Lower supervisory and lower technical occupations | Intermediate blue- collar | |||
VI | Skilled manual workers | 6 | Semi-routine occupations |
Working class | |||
IIIb | Routine non-manual workers, lower grade | 7 | Routine occupations | ||||
VII | Semi- and unskilled manual workers |
|
| ||||
Notes:
a. Includes ‘large’ employers (Goldthorpe, 1997).
b. Includes independent professionals (Goldthorpe, 1997)
A: Dowding (2000)
Hirschman’s model: exit, voice and loyalty
Exit and voice are two responses to a decline in product quality.
Exit and Voice
Exit signals to firms that customers are unhappy with a product, in terms of quality and price. In order to cope with exit, a mix of alert and inert customers is required. This way the customer can give an early signal, without mass exit causing bankruptcy. In a perfect market exit is a good way of signaling customer demands, not in a monopoly. An advantage of exit is that it is a fairly rough binary response, voice can be more subtle. An advantage of voice is that customers can express more what they desire, what can cause a reduction of satisfaction. Exit is dichotomous, voice is continuous. A disadvantage of voice is that talk can be cheap, actions speak louder than words. Voice is in general more costly than exit, with fewer results than exit.
Exit and voice simultaneously: noisy exit à voice is used to advertise the individual’s exit decision. Union membership is a negative predictor of exit for all employment categories. The results on voice are not so clear, because of the difference in opportunities to voice within a trade union and the forms of voice that may vary outside the trade union.
- Vertical voice: taking to superiors of a firm
- Horizontal voice: talking to friends and neighbors
- Individual voice: action where the intention of an individual is to bring effect based on that action.
- Collective voice: action with the intention of an individual to contribute to an effect through that action.
The choice for individual/collective voice depends on: political and economic competition, legal rights and expressive benefit of the act itself (rebound effect)
Exit: modus operandi of economics
Voice: modus operandi of communicating political demands
Loyalty
Influences of decision to voice rather than exit:
- Willingness to trade the certainty of exit for the uncertainty of improvement (related to loyalty).
- The estimate of the ability to be influential to the organization.
Forms of loyalty:
- Brand loyalty
- Group loyalty
Degree of loyalty depends on:
- One’s identification with the object of loyalty
- The amount the person has invested in the object of loyalty
Loyalty increases voice and exit. However the mistake can be made that loyalty is seen as a separate behavioral variable.
Dissatisfaction is connected with destructive responses (exit and neglect) and large investment is connected with constructive responses (voice and loyalty).
Greenfield: Build new firm in other country.
Brownfield: Start in other country, but buy an already existing firm.Country comparison on Group Formation:
| UK | USA | Italy |
Social distance dimension Differences in: gender, colour of skin, pay, clothing, living conditions (Cost of Living Adjustment), education, language, religion, world-view, polarisation...
| B: Since 1997 immigration quadrupled since election of Labour, mostly economic and temporary migrant form Eastern Europe; there were issues with discrimination, inequality that were under discussion (Human Right and Equalty Commission). Also gender equity by Equal Pay Act (1970)
| T: Initially fairly widespread prosperity (17th, 18th century) (p. 66); 1930s: depression, deterioration (p. 64); 1950s: general prosperity, COLA (p. 64); polarization, more poverty (p. 73/84). Also: diversity within the group of employees (p. 66) relatively large low-wage sector (p. 79.)
| B: From 1990’s Italian IR has been evolving (p139). Unions are involved in all major policy-making
There are differences in political opinions, religion
|
Escape dimension (voice, exit, lock-in) Exit: labour mobility, emigration, employment-at-will, employment protection, (e)migration...
Voice: grievance procedure, works council, voting rights, right to strike, consultation, participation
| B: After WWII shop stewards bargained industrial negotiations (p49).
B: Fragmentation of work (network organizations) affect workers’ voice, though no access to union recognition/collective bargaining or no access to EIP practices (p58).
| T: From 17th-19th century: mobility from working to entrepreneurial class (p. 66). In 1930s: strike wave (p. 64); strike prohibited for government officials; right to organize/bargain (p. 69) internal labor markets (p. 65) (p. 65: small/rural firms). 1935: Wagner Act, right to organize, strike (p. 64) employment-at-will (p. 70) (= no employment protection) grievance procedures (p. 72). (p.66). indication. | B: Voice: hot autumn: massive strike wage over pension reform in 1968 (p141). This overturned all social, political and economic patterns established in post-war period (p142).
B: Voice: election of representatives by workers (p.149).
B: Voice: referendum in 2008 concerning the minimum age for seniority-based retirement (p154). |
Time dimension One generation or Intergenerational |
| Within-generation social mobility [myth: log cabin to White House]
Between-generation social mobility [myth] – no real |
|
| France | Germany | Denmark |
Social distance dimension Differences in: gender, colour of skin, pay, clothing, living conditions (Cost of Living Adjustment), education, language, religion, world-view, polarisation.. |
| T: CME: Compress differences. Differences are growing based on working poor and typical employment (p210). | CME (network of unions, employers’ organizations and political-administrative system) with liberal elements (selregulation by labor market parties) (p225).
|
Escape dimension (voice, exit, lock-in) Exit: labour mobility, emigration, employment-at-will, employment protection, (e)migration...
Voice: grievance procedure, works council, voting rights, right to strike, consultation, participation....
| B: 1864: Strikes were permitted, but union formation was illegal. Unions became legal in 1884 (p171).
B: The five unions are representative unions. This gives them rights like: nomination of candidates of representation in firm, representation of consultative bodies and collective bargaining (p175) | Exit and voice exist
high employment protection, internal labor market promoted through work of works councils (labor market rather good compared to other countries)
works council (almost 50% of employees are covered), codetermination.
Lock-out legal.
| Voice and Exit seems high. There is a supported collective bargaining system. Firms support the firm’s representatives at such parties.
|
Time dimension One generation or Intergenerational | T: Multi generation | B: Not in chapter | Society is rather open so one-generation dimension might be possible. |
| Japan | China | India |
Social distance dimension Differences in: gender, colour of skin, pay, clothing, living conditions (Cost of Living Adjustment), education, language, religion, world-view, polarisation...
| B: Modest differences In wages between managers, non-manual and operative staff causes identification with the enterprise. Also most managers are promoted internally. (p.261) à great difference with Western countries.
| B: Women have high employment participation rate (p.307).
B: Government in China is dominant (p. 209). | B: Difference between organized and non-organized sector. Labor law is addressed mostly to the 7% employed in the organized sector. Problem: India has too many laws protecting too little people (p.349). |
Escape dimension (voice, exit, lock-in) Exit: labour mobility, emigration, employment-at-will, employment protection, (e)migration...
Voice: grievance procedure, works council, voting rights, right to strike, consultation, participation....
| B: No escape: lifetime employment (p.258).
B: Employee voice is hardly audible (p.277). |
| T: Caste, but is not mentioned clearly in the book. |
Time dimension One generation or Intergenerational | Within generation |
| Between generation |
Works council | No works council |
France | UK |
Germany | US |
Italy (Factory level) | Japan |
Part 4: Interest Group Organization
T: Organizational groups of L: Trade unions, political parties
Organizational groups of C: employer organizations, trade associations, political parties.
T: important to keep in mind, that unions generally started organizing earlier than employers at national level, because C enjoyed free-market conditions (long or not regulated working hour, pay, low wages etc.)
Factors for a group to organize collectively:
- Violation of interests (perceived): worrying about food, rent, unemployment, pensions, prices, taxes other basics of everyday life.
- Communication among group members
Crisis (e.g. strike or emigration wave, revolution) is often a necessary condition for organization to be created.
A: Traxler (2000). Employers organizations
In the labour market an association’s ability to act strategically depends on how many segments of the labour market that association can control, meaning that C as well as L have to have as many labor-segments under control if they do not want to be played off against one another and have a fair relationship and bargaining power.
The most conventional way to measure membership strength of interest organizations is density (the ratio of actual to potential members). Because employer assosiations organise collectivelly, membership density of firms and of the firms’ members can be measured. Later is usually higher. When associational power in the labor market is measured, density of employees is the right indicator because when comparing employer organization with union, the strength depends on the number of employees covered.
Employer peak organizations are associations of lower level associations. At the levels below the peak organization, employer organizations are more differentiated by specification of member categories (like branches, firm size) than unions are. This multiple membership of firms complicates the calculation of net density.
There are more lower-level associations not affiliated to any employer peak organization than employees organizations not belonging to national-level unions. In most European countries firms are indirectly affiliated to the peak organization.
For all these reasons, data on employer density are often rough estimates.
Employer density (LED) in Europe 1991-93. (Traxler, 2000: 310) :
France: 75
Germany: 73
UK: 54
Denmark: 42
Italy: 38
Important to note, that employer density reflects only a country’s principal employer peak organization here, these ratios cannot be directly compared to union density, which is made out of all available data on a country’s distinct union confederations.
Factors determining employer density:
- Economic: size of a country (the bigger the country, the more difficult to act collectively), country’s integration into global economy (foregin trade dependance), composition of sectors (some sectors are easier for recruiting members than others).
- Institutional: assotiation’s orgnisational structures (high centralization might decrease employer firms willingnes to join) and selective incentives (members get financial benefit, advice, statistical infromation, non-memebers “get punished”).
Negative Incentives for membership in employer organizations (influenced by unions):
- Voluntary membership: taking part in extension practices, bargaining about collective agreements which are going to have influence on them anyway.
- Union strength: multi-employer bargaining strength: This protects members of employers’ organizations from union tactics to deal with firms “one-by-one”.
Europeanization of employer organizations has made progress, especially in the cross-sectorial level. Economic integration, perceived as the key to convergence within the EU, has no visible effect on the tendency of the employers to act collectively. This shows that the nation state still plays the main role in terms and conditions of employment regulation.
A: Ebbinghaus and Visser (1999). Union Growth and Decline
Union density is considered to be the most available indicator of measuring union movement in an industry or country. Across countries it is a measurement of relative strength, together with levels of centralization, political unity, government accessibility , organizational concentration, legal protection and workers ability to act strategically.
Approaches for union growth and decline:
- Cyclical: regular pattern of ups and downs in union movement correlate to periods of economic flourishment and crisis.
Cyclical factors (politico-economic change):
- Business cycle: the influence of unemployment and inflation on unionization.
- Political cycle: pro-union left and anti-union right. Keynesian vs. non-liberal macro-economic policies.
- Structural: union growth and decline are caused by long-term changes in society, economy and politics. Declines are results of changing class structures, social values, new modes of production, flexible labor markets.
Structural factors (social change):
- Changes in social structure: formation of working class vs. de-industrialization, decline of manual work, rise of white-collar/service workers, increased female workers, more small-sized firms.
- Changes in social values: individualization of life styles vs. collective work orientation, diffusion of post-materialist values.
- Configurational: emphases cross-national variation and historical contingency. Institutional differences enable or restrain C and L actions and so influence union movement.
Configurational factors (institutional context):
- Welfare functions of unions: selective incentives of welfare services by unions vs. public schemes/ non-union institutions, State policy, Ghent system, extensions.
- Role of unions at the workplace: traditional or statutory access and influence of unions at the workplace, role of representatives. Access of unions to workplace workers.
- Employer strategies: recognize or oppose unions and centralized bargaining vs. recent decentralization caused by international competition.
- T: counterstrategies of employers: divide-and-concquer by creating company unions (yellow dog unions).
Cyclical and structural approaches do not explain cross-national divergence between industrial societies and see national characteristics as an exception to convergence.
In all Western Europe countries, in the period after the Golden Age of Capitalism (1950—73) trade unions’ membership growth was lower than in the years up to 1975, and most union movements have been in decline since that time. Union decline has multiple interrelated causes. E.g. unemployment might have an opposite effect when union-led unemployment schemes provide a selective incentive for union members. The same holds for works councils with or without union representatives in the firm, or for corporatism with or without workplace unions. This is due to economic, political, and labor-market changes as well as institutional context, which creates conditions for unions (and other collective actors) to act.
T: Union power can be also indicated by:
- Number of members (but paradox of size may occurs)
- Presence and size of strike fund.
Organizational logics (Van Waarden, 1992:522/538):
- Logic of membership (Legitimacy). Strategy: representation of members (bottom-up):
- Low level of centralization
- Small in size (homogeneous)
- Low membership dues
- Low level of professionalization
Not easy to say to which IR system this logic would be the most related to.
- Logic of influence (Effectiveness). Strategy: gaining recognition from environment actors and controlling members (top-down):
- High level of centralization
- Large in size (heterogeneous)
- High membership dues
- High level of professionalization
Typical to bargained corporatism IR system.
Levels of organization and negotiation: National (peak organizations) è regional (applicable to a number of case but not everywhere) èindustry è firm èplant.
Country comparison on Class Organization:
| UK | USA | Italy |
Logic of membership/ influence
level of centralization, size, height of membership dues, level of professionalisation within the organization. | B: Since 1980’s LP leadership caused reduced voting power etc. (p38).
B: Employment Relations Act (1999): enable managers to resist unions (p40).
| T: Not applicable to company-dominated unions as union-substitution device (p. 64); centralization suggests logic of influence. T: Centralization strike fund in national union (p. 66); locals negotiate (p. 68) | Structure of TU seem to have logic of influence as there are membership fees and official union representatives, BUT strategy seems to have membership focus. Problem: Italian union militancy and political divisions (138); mixed role of RSU (=sth. like factory councils, union bodies AND general worker representation, 2/3 elected by workers, 1/3 appointed by union) (p.149-150);
Two-level bargaining (see components of wage demands of union to interpret the system) (p153): granted access, but less social power, though remarkable mobilization capacities (p164).
|
Unions: Craft vs. Industrial
Occupation as basis or industry
| B: In mid-nineteen century first skilled craft workers Widespread unionism started in late nineteenth century (p38).
| T: Started as craft (p. 63/64), AFL 1886; later industry (1930s CIO) (p. 64) | First craft, the industrial. |
Unions: Categorical
Blue-collar, white-collar, mixed
| B: Before WWII white collar only unionized in public sector, from 1960 also in private sector (p38).
Most unionism among non-manual workers, women, full-time workers and aged over 50 (p38). | T: Blue collar workers organized, white collar no indication | B: Hot autumn: unification of blue- and white collar job classification schemes (p141). |
Unions: Ideology
Bread-and-butter, religion, world-view | B: First political ideology: Labor Party (p38). Now, unions may associate with LP, contributing to its funds by a ‘political levy’, which members may opt-out (p38). | T: Apolitical ‘business unionism ideology (also: bread and butter (p. 66), lobbying, support for Democratic Party (p. 67) political parties; see also p. 89); also p. 70
| B: Communist, Socialist & Catholicon ideology (p140) |
Union density | After 1979 great decline in union members.
B: Great fluctuation since WWII, partly caused by external (politics/macro-economic context etc.) and internal factors (inadequate recruitment/failure to deliver benefits etc. (p38).
28% in 2007 (p38) 25.6% in 2011 (OECD) | T: Relatively low, decline (p. 67)
11.2% density in 2013 (BLS)
| A: After WWII high membership due to political mobilization, but fall after coalition. After 1868 growths after reuniting union movements. 1980: 49% 1995: 39%
35.6% in 2011 (OECD)
B: After Hot Autumn union density has been declining even since (p145). Despite of this, union membership has been growing constantly because of retired workers.
B: Low density rate, constant replacement of active with retired members there seems no great future for unions (p147).
|
Employers ideology:
Social partnership vs. free market | B: Since 1980: greatly enhances employer power and freedom of action, caused by high competition in product markets and reduction of unionism (p42). | T: Regarding IR: employer organizations not very important, only for avoiding unionization (p. 65), e.g. NAM, also CoC. Seems more campaign-oriented; also consultants possible.
| Cold War: union busting (140); more hostile in small firms, negotiation in large firms (144) weighted voting system based on size (143); density 28% (144); Confindustria most important (144)
|
| France | Germany | Denmark |
Logic of membership/ influence
level of centralization, size, height of membership dues, level of professionalisation within the organization. | B: Unions’ right to negotiate depends on being recognized as representative (10% of votes at company level and 8% at industry level). An agreement is valid with ‘joint position’ (p178).
B: Right to strike (p188). Lock-outs illegal.
| B: Unions mainly belong to the German Trade Union Federation (responsible for lobbying etc.) (p199)
contracts are signed by unions and industry associations
|
|
Unions: Craft vs. Industrial
Occupation as basis or industry
| First craft, then industrial | T: Started as craft, now mainly industrial.
Whole industry. | B: LO = largest union is mainly manual (p233). Most of the unions started as craft unions. |
Unions: Categorical
Blue-collar, white-collar, mixed
|
| B: Both the same union, no differences (einheitsgewerkschaft). (p199) | B: White-collar Workers Act (p.237). |
Unions: Ideology
Bread-and-butter, religion, world-view.... | B: Union movement: Pluralistic, rival and fragmented on the one hand and scarcity of financial and organizational recourses on the other (p171).
B: France unions: Marxism, anti-communist, political etc. (p173).
B: French unions do not want mass membership, unlike Germany. They want to foster strikes.
B: Both ideological and political (p177).
| T: Religion, not closely to political. So ideological influence (p199). | B: LO (union confederation): political ideology (p235). |
Unions: Centralization vs. decentralization who decides about fine when entering into collective agreement (CA), and (anti-)strike fund | T: No strike funds (+p190). France loses relatively few working days due to strike, unlike Italy and English speaking countries (p190). | B: Intermediate levels of centralization (p210)
| B: DI (Confederation of Danish Industry) on the C's side
B: Role of government is more limited than in other countries (p236).
|
Union density | After WWII high membership due to political mobilization, but fall after coalition. ‘Unity of action’ had little success. 1970’s: 20% 1990’s: 10% 2010: 7.8% (OECD)
B: 2007: 8% (p172). France has five national union federations. Declining due to skepticism of young workers towards unions (p176).
| 18% in 2011 (OECD) | B: Employer density rising, due to their role as special-interest business organizations (p232).
B: Overall trade union membership fell to 69% in 2007 (p.245). |
Employers ideology:
Social partnership vs. free market | B: Instead of the pluralistic unions, there is one national employer federation. Unlike Britain and Germany this association is engaged in negotiating on broad issues from the ‘60s, although wages and working hours were excluded and pay is being determined at the industry level. (p 179).
|
|
|
| Japan | China | India |
Unions: Craft vs. Industrial
Occupation as basis or industry
| B: Both craft and industrial, but mainly in firms with more than 100 employees (in private sector) (p260). |
| B: Law is silent in this (p332)???
B: Craft, occupational, employment, caste. (p335)
|
Unions: Categorical
Blue-collar, white-collar, mixed
| B: Difference between regular and non-regular workers. Regular workers have special status. For this reason enterprise union do not organize non-regular workers. This undermines plant level unionism (p262). |
|
|
Unions: Ideology
Bread-and-butter, religion, world-view.... | B: Political ideology (p.254/255). | B: Socialist ideology (p.315).
B: Their main function is to safeguard the legal rights and interest of employees (p315).
| B: Ideology (p331). Economic, political, social and welfare objectives (p 333). |
Unions: Centralization vs. decentralization who decides about fine when entering into collective agreement (CA), and (anti-)strike fund |
|
| B: Decentralized, using mostly a union shop form (p332).
(B. Unionization is less than 5% of the workforce (p.330). Yet unions and collective bargaining is important for economic growth.)
|
Union density | B: Differs per industry. Average density in 2007 was 18% (but in public services 59%). When the firm is expanding, union membership generally rises (p.257).
| B: 93,7% in 2006 (p.317) |
|
Logic of membership/ influence
level of centralization, size, height of membership dues, level of professionalisation within the organization. |
|
| B: Logic of influence (p 334)(p.339) |
Employers ideology:
Social partnership vs. free market | B: First employer organization established in 1948 (p.263).
B: Tasks: coordinates and publishes employers’ opinion on labor problems, selects employer representatives, delegates and advices (p: 263).
B: The declining power of unions causes increasing influence of employers over employees (p. 264).
Employers' organisations focused on labour matters (such as wages) first, but in 1980/1990s became less important. Nihon Keidanren is important; coordinates and advices member organisations at regional and industrial level. Besides, government now free-market and deregulation: relaxation of labour market regulation, especially regarding temporary work
| B: Employers’ organizations are not very well established in China. The lobbying power of the employers is however rising (p. 311).
Leaning towards union-busting, especially in the private and foreign investment enterprise (FIE) sector (318/337), yellow dog practices
| Anti-unions and no limit collective bargaining with unions or workers.
|
Categorical unions: France, Japan, US, UK, Italy (First craft, then industrial), Japan (Firm level), Germany (principle of no division).
Some Trends in union density:
Denmark: Union movements with continuous growth. Ghent system.
UK: A sharp turnaround in fortunes between 1950-1975 and 1975-1995.
Germany: Long-term stagnation and decline.
Italy and France: wave-like patterns between 1950-1975.
State unemployment schemes were made mandatory for workers in: Britain (1911) and Germany (1927).
Part 5: Collective bargaining
T: Collective agreements (CA) are the most basic institution of IR:
- they reflect state of the the contract regarding E – W, which is the fundamental part in the relationship between C and L.
- thet exist in some form in all three levels of IR (CM) systems.
T: CA is a labour contract for a group (collective of) workers.
Advantages of having collective agreements: reduction of conflict costs and industrial peace (during the contract period no renegotiation is possible). Moreover, having a collective agreement is more efficient for C since firm does not have to negotiate with every single employee when hiring.
Weaknesses of CA: only binding for parties that have signed it. Therefore: organizational density (both employers’ and workers’) = collective bargaining coverage (CBC).
T: Generally, C finds the company level collective agreements most attractive, as they are most powerful here (they decide about its organizational structure, orders, investments, etc.). Moreover, employers are supposed to have an information advantage (so able to dictate the terms of contracts).
However, both workers/unions and employers may prefer the sectoral level (most often industry level). Firstly, because smaller employers sometimes face more powerful unions (since (sectoral) unions organise in order to defend against C). Secondly, having industry level collective agreements means that wages can be kept at a moderate level, which is especially pleasant for employers but not workers. Unions have obvios advantages in sectoral CA level too: “Multi-employer bargaining establishes the common rule through standard terms and conditions; provides comprehensive regulation of the labour market, covering many smaller firms where unions are not well organized; and reduces transactions costs, a significant consideration in less concentrated industries” (Marginson et al, 2003: 164).
T: CA can be used as a tool to reach cheaper production:
- Outsourcing: replacing employees and parts of firms to areas where CA grants lower-wage CA. E.g. Ford & Visteon situation (USA). Negative effects for L of outsourcing: endangered job security, reduced wages, lowered fringe benefits, transition agreements (the pay reduction is “softened” by lowering wages with a specific percentage every year until the new wage level is reached).
- Dualism: some countries have 2 IR system levels, so employers tend to transfer their production to more profitable/less covered by CBC sectors (e.g. India formal sector vs informal sector, China rural workers and urban private and informal workers, Japan’s regular and non-regular employees.)
Atypical employment, informal sector is rising since 1980-90s (e.g. Germany: CBC decrease p.211).
Developments of CA: More subjects are being included. At first (about 1900) only working time, wage were being concidered. Later, parent leave, education were added. Since 1980s: development towards the firm level, industry level desintegrating (international competition; employers have become more powerful).
In order to forecome the above mention CA weaknesses, country can use extension mechanisms to make national and sectoral level CAs applicable to all employees, not only the social partners’ members which signed the agreement.
A: Kerckhof (2011) Extension of collective bargaining agreements in the EU
In 21 EU Member States where CA can be legally extended. It can be done by means of an administrative decision by the ministry of labour, a publication in the country’s official journal, or both. In some countries, it is done quasi-automatically, in others, one or both social partners have to demand it. Moreover, there are specific conditions that must be met before a collective agreement can be extended. These differences among countries lead to more or less frequent use of extension mechanisms.
The extension mechanisms self depend on three factors: who takes the initiative, whether there are minimum requirements, and how frequently they are used.
T: Extension levels:
- Firm level: voluntary by employer or union-employer agreement (e.g. Germany, partly)
- Industry level: government (mandatory extension, government intervention) (e.g. France)
- Functional equivalent: not extension in formal sense, but demand in case of government contracts e.g. (e.g. Germany, Italy).
- Not needed when density is high, e.g. Denmark because of Ghent system.
A: Marginson et al. (2000) Between Decentralization and Europeanization
The dominant trend in IR of Western Europe over the past 20 years is decentralization of collective bargaining. It started on the employers’ side (large companies). Four main factors represent the shift in employer position (Marginson et al., 2000: 165):
- Employers need to be more flexible while negotiating arrangements suited to the particular requirements of individual companies.
- Management control systems are changing: transferred budgetary responsibility and performance targets provide a new and powerful means of managing costs.
- Conflict between the different multi-employer agreements for companies which diversify their business interests across sectors.
- “Internationalization of product markets weakens the logic of taking labour costs out of competition within the nation-state — a factor of particular salience in the context of a single European market”.
Traxler (1995) has defined 2 types of decentralization:
- ‘Organized’ (decentralization occurs within the framework of sector agreements). Typical to most EU member states.
- ‘Disorganized’ (such agreements fail to be displaced by company-level arrangements). Typical to UK.
Country comparison on Collective Bargaining:
| UK | USA | Italy |
Development of CA (Collective agreement)
Change regarding level, content, decenralisation
| “Unorganized” decentralization.
B: Representation gap (absence of a mandatory system of employee-consultation): management often sets terms and conditions in stead of collective bargaining (p49).
B: the fragmentation of management support for employment relations is likely to accelerate as employers face sustained pressures to reduce costs, focus on their core business and increase contracting out to other firms (p.43)
B: 2004: Single union bargaining. Union recognition low (p50). | T: 1935: Wagner Act (NLRA) (p. 64), not for government which has its own regulations (p. 68) (no strike) See p. 70-71 for its workings in the PRIVATE sector; union vs. non-union sector (p. 70-71); employer neutrality during elections (p. 81) disputes in general court system (p. 69) 1980s: legislative activity because of gaps created by weakening of unions (p. 70)
T: Outsourcing (playing the CA-structure) (p. 74-75)
| B: Centralized bargaining (p138). Until 1990: decentralized bargaining (p139).
Because of the tripartite agreement of 1993, more centralized (p155).
B: Between 1992 and 1998, cooperation between unions, with support of the government. Peak level bargaining agreements were made. Two-tier structure of collective bargaining was introduced, at the industry and company level (p152).
B: The wages usually grow less than productivity. Therefore the metal industry included a wage element paid to workers from 2006 (p156).
|
Level of CA (Collective agreement)
Country, Industry or plant level
| A: Both unions and employers organizations do not participate in collective bargaining.
A: Single-employer (26%).
B: Industry level, from mid-70’s decentralized (p49),now company or plant level dominant (EIRO)
| T: Company or plant level dominant (p. 72; also EIRO); content CA: p. 72; grievance procedure p. 72-73; CA very detailed (p. 72) alternative dispute resolution (p. 73)
| B: After Hot Autumn enterprise bargaining became the cause for interesting innovative collective bargaining. The role of the industry was to generalize and spread the agreements. (p155).
B: Employees rejected collective bargaining at two levels, and finally chose for the enterprise level (p156). Unions wanted to remain both levels.
|
Bargaining coverage | B: 1971: Industrial Relations Act weakened employees’ ability to strike and made collective agreements legally enforced contracts (p45). Unions boycotted act.
B: 1970: 70% Now: 27% (p 50)
| A: 15% (in 2002, EIRO) non-union sector continued to grow (p. 76)
| Private sector: less than 20%
B: In public sector currently formal collective bargaining (p158). ARAN is an agency responsible for all bargaining activities in public sector (159)
|
Extension mechanisms mandatory extension, functional alternatives, | Pattern bargaining
| B: pattern bargaining as multi-employer extension → standardization. It’s union initiative, not government, so NOT mandatory extension (p. 80)
| Mandatory extension B: Unions that pass the election may participate in collective bargaining in public sector, making agreements binding for all workers. (p150).
|
Dualism |
| Yes, members vs. non-members. | B: Dual system (p156/166), but debate is not over. Public sector was privatised in 1993 to make it more similar to the private market (158)
|
| France | Germany | Denmark |
Development of CA (Collective agreement)
Change regarding level, content, decenralisation
| B: Unions are not focused on collective bargaining, but more on foster strikes and encourage political action (p176).
B: Since the 1960’s there is a close link between French industrial law and outcomes of collective bargaining.
B: 1981: Report on the rights of workers. 1982: Employee participation act: give employees the right to decide on working conditions. This gave priority to collective bargaining. 1982: Collective bargaining act (p185).
| B: 1970: Keynesian instruments (p203).
B: Wage agreements, framework agreements, umbrella agreements (p209)
B: Extensive social regulation, focused on occupational status and insurance principle has always been regulated by law and not by collective bargaining. (p197)
B: Social partners have right of free collective bargaining, no state inference. (p 202).
Decentralization | B:1899: September compromise between confederations of employers and wage earners. Collective bargaining became preferred method of regulation for pay and working conditions (p.224/226).
B: 1934/1936: Conciliation Act: unions and employer organizations are either entering into agreement or are all in conflict. In that case using a mediator. However there is a lot of intervention by the political system (p229).
B: After crisis in 1970 a new development of the Danish Model took place: centralized decentralization: organizational centralization with overall coordination, with negotiations at enterprise level. (p. 239). This caused more bargaining coverage and an expansion in the scope of collective agreements: wage, (flexible) working hours, welfare related issues, training, social chapters, sick pay etc. (p.240/241). |
Level of CA (Collective agreement)
Country, Industry or plant level
| B: Both sector and enterprise level (p182).
T: Company level dominant (EIRO) | B: regional/ industrial level (p209/199, EIRO).
| T: Both intersectoral and sectoral levels are dominant (EIRO)
Multi-employer (45%)
B: Danish companies have a strong local union representation: 80% represented by shop stewards (p240).
Ghent system. |
Bargaining coverage | A: 90-95%
B: All wage-earners benefit from collective agreements. When approved it applies to all employers, organized or not (p176). | A: 67% (unadjusted, data only until 2000).
B: Declined from 70% to 55% in West Germany. In Eastern Germany now 40%. (p211). So medium coverage. | A: 83%
B: 90% in the union areas. A quarter of the wage-earners is not covered by collective agreement (p. 237).
B: Trend: public and financial sector set the standards for social welfare elements in collective bargaining (p238).
|
Extension mechanisms
mandatory extension, functional alternatives, | B: Mandatory extension: collective agreements include the basic labor relations for a given sector. These rules can be extended by the Minister of Labor to apply to all French workers (p186).
| B: Informal: Pattern bargaining, especially in engineering. This is caused by the structure of annual regional activities, coordinated by national unions and employer organizations. (p209/210)
|
|
Dualism |
| Public sector has its own agreements, collective bargaining agreements for typical but not for atypical workers. Tarifflucht= 'tacit escape from collective agreements': maintaining membership of employers' associations but not complying with term of industry-wide CA (despite legal requirements) e.g. deviate from working hours, fringe benefits, wages (p.211).
|
|
| Japan | China | India |
Development of CA (Collective agreement)
Change regarding level, content, decenralisation
| B: Was centralized, but this is now seen as being outdated (p.257).
Decline of union density and different economic climate changed Shunto: focus changed from national wage bargaining to wage bargaining at company level. This is due to globalization and increasing differences between companies.
| B: Defining the official procedure of employment relations, China prefers the term ‘collective consultation’ over collective bargaining (p.319). It was first introduced in early 1990s, negotiated at enterprise level and seen as more fitting to non-confronting Chinese culture. Trade unions have been given the official role of representing workers, reinforced and expanded in 2001, 2004
| T: India is a rural society, agriculture. China is too.
B: Industrial Disputes Act includes as unfair labor practices: refusal of employer/inion to bargain collectively and indulging coercive activities against certification of bargaining representative (p.341).
|
Level of CA (Collective agreement)
Country, Industry or plant level
| Only enterprise level (p264), (EIRO) It is done by representatives of the union and focuses on pay issues. Mostly pay negotiations.
| B: Enterprise level (319/320).
B: Unions generally lack the resources and power, skills and legal knowledge to fulfill collective bargaining and to defend members’ rights (p.316). Agreements are more adopted in SOE and not private companies. ACFTU tries to provide larger coverage, however: most agreements made without extensive involvement of employees, more between state and union.
| T: From industry to more plant level (p 342).
B: 1970s sectorial bargaining at national level was prevalent (p.341). |
Bargaining coverage | Business conditions (p264).
B: Consultation mechanisms. The line between collective bargaining and consultation mechanisms is vague, because the same people participate in the meetings (p.264).
B: Non-regular workers are less protected, because they fall out of the scope of collective bargaining (p.269).
| B: Collective contracts may include: labor remuneration, working time, vacancies and rest, occupational safety and health, training, insurance and welfare (p.319). | B: 2% of total workforce, 30% in formal (organized) sector. (p 337) B: Duration of collective agreements: from 1990s 80 percent of the public agreements are signed for 5-10 years. Private sector 3-4 years (p342).
|
Extension mechanisms
mandatory extension, functional alternatives, | NO mechanism | Attempts by AFCTU to make provide larger coverage such as region-based and industry-wide collective contracts, it is not so effective and in fact does not cover so many people.
| B: Collective bargaining is not extended to industrial workers in government undertakings (railway, post etc.) p 338)
|
Dualism |
| Harsh dualism: formal vs. informal, urban vs. rural
| Similar to China. |
Part 6: EU and National IR
T: There were talks about unification of Europe at the end 1800’s, beginning 1900’s (1915 Lenin wrote an article “United States of Europe”. But 1930 crisis and war lead to national orientation and protection. Actual Europeanization is considered to have started with ECSC and the Marshall plan (countries had to cooperate in order to get the US money).
ECSC (European Coal and Steel Community) à 1951
EEC (European Economic Community) à 1958
OEEC (Organisation for European Economic Cooperation) à 1948 established to administer Marchall plan (first organisation in which cooperation among European countries was supervised by US). Reformed into OECD in 1961.
ETUC (European Trade Union Confederation) à 1973 estblished to represent national level workers’ organizations at the European level. Its role has increased as European integration has expanded EU influence on economic, employment and social policy throughout the 28 Member States.
T: EU’s 2 important structural elements:
- EMU (European Monetary Union) – using the same currency results in autonomy loss for a country (Economic problems cannot be solved by the help of exchange rate, but through economic restructuring (unemployment, working times..)).
- Budget control – Maastrich Treaty rescuires not lower than 3% GDP budget deficit (this results in budget cuts on social insurance, education, etc.)
T: 3 EU developments:
- Eurocorporatism (need for EU-level IR system).
Requirements:
- EU-level organisations – present. ETUC and BusinessEurope.
- CAs, mandatory extensions at the EU level – ETUC is basically coordinating, not able to enforce capital into transnational collective agreements at the industry level. EU provided only guidelines but they are not direcly binding, so C can do nothing and only L is engaged to create a coordinated collective bargaining system (L has committee for coordination of collective bargaining, guidelines per indusrty and coordinate among nation level trade unions, seeking to prevent “social dumping”).
- EU-level Social dialogue - present
- Social Dialogue.
- Bottom-up: EU does involve social partners (EESC), 1998 sectoral social dialogue committees were established (there were 40 in 2011)
- Top-down: 1992 agreement on Social Policy, 650 joint text written, but just 4 legally binding cross-industry and 5 sectoral.
- Destruction of national systems. Especially in posted workers’ cases, national law is “put aside”-preliminary ruling of ECJ (Laval case 2008, Rueffert case 2008), when country of origin is decided to be lawfull, while Posted workers directive of EU stated it should be country of reception.
T: Problems:
- Convergence vs. Divergence (latter is happening among new-old EU countries)
- Regional (national) differences: downward or upward alignment: how to align e.g.wages? Posted workers problem: country of origin or country of reception principle? Leads to social dumping, since C wants to pay least possible.
- Restriction of worker rights to industrial action – extension mechanisms:
How to formulate collective agreements for whole Europe? There is a large inequality, thus almost impossible, especially since C is against it and L, even organized at EU-level cannot enforce it.
Country comparisons on EU:
| UK | USA | Italy |
Euro corporatism tripartite committees at European level, CA for European industries, social dialogue, (in fact: CME at the European level) | B: UK became member of EEC in 1973, but many employer organisations resisted the extension of the European social policy agenda. Also Thatcher anti-union legislation excluded unions from the bargaining about EU industrial relations (p54).
Accepting Maastricht Social policy by Blair gave IR in UK more space for improvement of social employment rights (The floor of individual employment rights is being extended, there is commitment to the Social Chapter). (p55). |
NOT APPLICABLE |
|
Bottom up/ Top-down EU laws and adaptation of national laws to European laws/directives, international coordination initiatives of trade unions (organizationally, or guidelines)...
| B: No uniformity towards adopting the Euro (p54). No UK company has adopted European company status.
B: EU influences health and safety matters, individual employment rights and information and consultation rights (p55). |
NOT APPLICABLE | B: industry-level wage increases are linked to EU-wide index (157)
|
Destruction of national systems (Posted workers)
country of origin of the firm, meaning location of headquarters, social dumping |
|
NOT APPLICABLE |
|
| France | Germany | Denmark |
Euro corporatism tripartite committees at European level, CA for European industries, social dialogue, (in fact: CME at the European level) | B: 12,9% of the nation of EU. 66% of Frances trade in the EU (p169).
French socialist Dominique Strauss-Kahn was head of IMF. France plays leading role in EU by establishing both new European and world financial systems. Besides, CGT joined the ETUC in 1999, FO in 1973 (long supported European integration, but voted 'no' in 2005). CFTC in 1990. CFDT also member. CFTC & CFDT want social Europe.
|
| B: The tripartite cooperation has always been ad hoc. The participation of the government is especially in the public sector (p.237.
B: In 2007: foreign workers represent more than 20% of total workforce (p.246).
B: Problem for Denmark: EU demanded that all wage-earners would be covered by same directives (p242).
|
Bottom up/ Top-down EU laws and adaptation of national laws to European laws/directives, international coordination initiatives of trade unions (organizationally, or guidelines)...
| B: 1994: National implementation of EU directive on European Works Council, which defines consultation and information rights for employees in multinational firms (p185).
B: Multi-level bargaining has gained a greater political dimension, because of EU policy issues with important social consequences. B: Fear of privatising of the public sector caused by regulation of EU, which causes strikes (p190).
|
| T: Danish system differs from EU, because C and L regulate labor market, not government.
B: Denmark’s labor market is het most flexible of Europe, because of collective bargaining of regulation (p225).
B: EU puts pressure on the Danish labor to adapt market regulation by labor law directives like: working hours, part-time employment, fixed-term work, EU work councils, posting of workers to other states. Previously, these areas were regulated through the CA (p241-242). |
| |||
Destruction of national systems (Posted workers) country of origin of the firm, meaning location of headquarters, social dumping
|
|
| Laval case (246)
|
Part 7: Globalisation and IR: production chains and E - W
In history, there were 3 waves of globalisation:
- Wave 1: Began around 1870 and ended with the descent into protectionism during the interwar period of the 1920s and 1930s. During this wave of globalisation, the ratio of world exports to GDP increased from 10 % GDP in 1870 to 21% in 1913.
- Wave 2: After WWII, colonialism ended, there was a need for trade and reconstruction. The IMF (International Monetary Fund) was created in 1944 to promote a stable monetary system and provide a sound basis for multilateral trade, and the World Bank to help restore economic activity in the devastated countries of Europe and Asia. Their aim was to promote enduring cooperation among nations. The General Agreement on Tariffs and Trade (GATT In 1995 became WTO (World Trade Organisation) signed in 1947 provided a framework for international trade. The ratio of world exports to GDP rose sharply.
- Wave 3: After 1970, air-traficing became available for wide publics and boosted another sharp rise in the ratio of trade to GDP for many countries as well as a sustained increase in capital flows between counties. Latest world’s export ratio to GDP provided by World Bank was 30.1% in 2012, when in 1994 it was 20.9%.
T: There are two explanations for poverty:
- Residual: the effect of not participating in globalisation enough. World Bank view, WTO etc.
- Relational: Because of globalisation, some countries are rich and some are poor = globalisation causes poverty (Kaplinski, 2005; Prebisch, 1950; Singer, 1950).
Those rich countries decide/ influence/ affect what will happen in the 3rd world. This view is more related to the IR.
Globalisation can be expressed in the form of global production chains (firms/industries in different countries linked):
Mostly in former colonies
The western world buys raw materials cheap from 3rd world and sells them for high prices (ruthless purchasing practises). This is the relational explanation. The rich stay rich, and the poor stay poor. Colonies are now politically independent, but are still economically dependent. There is conflict within the chain. All chain parties (raw, intermediate and final) seek profit from the sale of the final product. The final producer is the most powerful thoug and decides who is in the chain, the quality level, etc. Thus, the most returns go to the most powerful party. This effect forms unequal distribution (remember an example of price war of supermarkets: the producers, suppliers in 3rd world countries pay the price, not the supermarket). To attract big firms and FDI, poorer, developing countries engage in EPZ (Export Processing Zones). In these zones there is no social security, low taxes and low wages, basically very scarce or no CA (modern slavery).
NGO’s non-governmental organizations and unions try to arouse public interest to introduce more regulation to EPZ’s, make companies working there more social accountable, e.g. Nike, Apple.
To reduce conflict problems, organizations have 2 options:
- Within a firm (divide and conquer). A strategy of work-force layering/ dualisation/ segmentation: give core employees more, others none. Popular in Japan (the family-run firms).
- Among firms: devolution or externalisation of problems to another party Transfer the problems to another firm, industry or country. This is an example of the relational explanation of poverty.
Impact of globalisation on IR:
- Simple globalisation approach: globalisation created pressures across countries and would have the same effect on employment relations. Economic activities have become so interconnected and there lies so much pressure on globalisation, that differences in activity (like employment relations policy) between countries decrease.
- Institutionalist approach: international trends are not common pressures in all countries, but are mediated by institutional arrangements and therefore are divergent struggles per country. Because these differences are enduring, they will not lead to general convergence, but predicts continuity and even increases divergence between national patterns.
T: Possible unions’ initiatives:
- L should be organized at the same size and level in order to be able to fight C: the unequal distribution, “ruthless pricing practices” or exploition in EZP’s :
- EU: unions adapt to European instead of national market (1999 ETUC committee for coordination; European guidelines per industry; coordination IRTUC.
- US: focus should shift to national level unions’ strenght building, not busting. But this would demand new forms of coordination and organisation.
- ‘Blacking’ work.
Country comparison on Globalisation:
| UK | USA | Italy |
Relational/ residual view |
|
|
|
Globalisation level: Exports of goods and services (% of GDP, 2012)
| 31.56% | 13.52% | 30.22% |
Chain analysis (barriers, competition, rents)
Rents in the chain, supply /product(ion) chain, investment barriers, entry to (an industry in) the chain, entry requirements, patents, just-in-time delivery, zero-defect delivery.... | B: Producer driven exporter (p169).
B: in 1979 with Thatcher implemented supply-side solutions to manage the economy with more control over public sector pay. There was deregulation of the economy and flexibilisation of labor market, which successfully solved high inflation problem. However, the next economic crisis did increase inflation again (p.46).
| NAFTA: - North American part is Producer driven - Canada, US. - Mexico is Buyer-driven chain part
| T: Globalisation in Italy is in the same position as a lot of low wage countries.
B: Italy has been hit in the face by globalisation: it is specialized in labor-intensive sectors (clothing) and thus competing with even lower wage countries like China is difficult.
|
Chain governance key actors - legislative, judicial, executive
standards for quality, ISO, SA 8000, monitoring standards, assisting chain members in meeting standards |
| NAFTA signed Agreement on Labor Cooperation (to protect labor standards and enforce labor laws) (p. 86/116).
|
|
conflict management strategies external/internal
pass on problems to others / solve them yourself. Dual/ segmented workforce, core protected segment / peripheral segment, internal / external, non-standard employment | More and more privatising state view: involve individual employee more so that he can solve his own problems. It applies for private sector companies as well. However, when necessary, the state financially supported the banking sector.
| B: Alliance steelworkers’ unions US/Canada/GB (p. 81), AT&T agreement: bring back offshored work; organizing outsourcing firms and alliances with unions in other countries (p. 75)
|
|
| France | Germany | Denmark |
Relational/ residual view
|
|
|
|
Globalisation level: Exports of goods and services (% of GDP, 2012)
| 27.44% | 51.79% | 54.37% |
chain analysis (entry barriers - governance (see below) - systemic efficiency)
Rents in the chain, supply /product(ion) chain, investment barriers, entry to (an industry in) the chain, entry requirements, patents, just-in-time delivery, zero-defect delivery.... |
|
|
|
Chain governance key actors - legislative, judicial, executive
standards for quality, ISO, SA 8000, monitoring standards, assisting chain members in meeting standards |
|
|
|
conflict management strategies external/internal
pass on problems to others / solve them yourself. Dual/ segmented workforce, core protected segment / peripheral segment, internal / external, non-standard employment |
| B: Depends on ability of the union to establish effective internal coordination (p.6). |
|
| Japan | China (1978/2007) | India |
Relational/ residual view |
| T: Open-door policy (309), opening up (313) suggests residual view of government
| T: Economic growth is not beneficial for workers, still bad wages. Important issue in India, representing a relational view.
|
Globalisation level: Exports of goods and services (% of GDP, 2012)
| 14.66% | 27.33% | 23.83% |
Chain analysis (barriers, competition, rents)
Rents in the chain, supply /product(ion) chain, investment barriers, entry to (an industry in) the chain, entry requirements, patents, just-in-time delivery, zero-defect delivery.... | B: After the recession of the 1990 most large Japan companies became multinationals with headquarters in Japan. This is why overseas production activities expanded (p.266).
| T: (indicator) private sector: small firms, low technology, competition on price (310). Direct: foreign-investment sweatshop plants and informal sector (313), also FIE (321)
| According to national and international employers and public policy experts, in order to sustain economic growth, more flexibility (to facilitate new technologies and production methods) in labor market is needed.
|
Chain governance key actors - legislative, judicial, executive
standards for quality, ISO, SA 8000, monitoring standards, assisting chain members in meeting standards |
| T: Chain governance (LL-JU): absent within-chain, growing outside-chain (309). Low labour standards, often violated (313); FIEs highest level of labour disputes (310/321). Absence of governance in specific chains (iPad – iPhone example)
| B: 1999, commission to align labor laws with requirements of a globalizing economy (p 338).
|
conflict management strategies external/internal
pass on problems to others / solve them yourself. Dual/ segmented workforce, core protected segment / peripheral segment, internal / external, non-standard employment | T: Dualism/ Segmentation of worforce very typical for Japanese family-run-firms: give core employees more, others nothing
B: international surrounding has changed, Japan can benefit from the closeness of dynamic , cheaper markets like China and India (p. 267).
B: Increased global competition is one of the reasons for the changed relationship between unions and employers since 1950 (p.266).
| T: External – low wages, China in the weak part of the chain, much competition. Segmentation between sectors (formal – informal (p.311))
Segmented workforce: workerts in rural areas and urban areas, EPZs.
| B: Collective bargaining in private sector, because of international competitive pressures (p.342). |
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