Soumission

Submission to the Federal Labour Standards Review

1. Introduction.

I would like to begin by commenting on something that appears to be central to the Review's mandate yet which may not be a problem -- at least to the extent that some within government circles seem to want it to be. I am referring to the so-called changes in the employment relation away from "standard" to "non-standard" employment.

I will not elaborate at length here (see Godard, 2005: 413-14). But I hope that the Review looks closely at available statistics pertaining to this issue. For example, part-time work has not increased since the early 1990s, and almost all of the increase over the decade prior to that time involved young workers, a large majority of which are in school. A recent Stats Can analysis found that only one in fourteen part-time workers had looked for full time work over the preceding year, which suggests that part-time work in itself is not a significant problem. In addition, there may have been some increase in temporary employment, but one has to get beyond the statistics to determine whether this really matters. For example, if temporary work is simply a passage way into a full time, well paying government job -- as it often seems to be, then it should not be of great concern. A similar issue arises for self-employment. What percentage of the self-employed are hobbyists or early retirees that putter about on E-Bay or the equivalent, and are covered by a spouse's benefit plans or are self-sufficient?

I do not have the answers to these questions, but it worries me that much of the literature into changes in the employment relation that I have seen does not seem to even ask them. I have no doubt that workers in non-standard employment are often subject to various forms of abuse, whether it is poor wages and benefits or arbitrary variation and uncertainty in their hours worked or incomes. But I hope that the Review does not get diverted by focusing on these issues at the expense of other very real problems that it should be addressing -- especially as many concerns that may be raised about non-standard employment involve problems that also apply to standard employment. They can for present be discussed under two related categories: the quality of the work experience, and the lack of adequate rights and protections at work.

2. The quality of the work experience.

Issues having to do with the quality of the work experience are relatively well known, so I will address them briefly, referring to my own research. This research, which involves 2003 and 2004 telephone surveys of 750 employed Canadians outside of Quebec (see Godard, 2005: 59-71) reveals that a great majority of employed Canadians -- typically 8 in 10 or higher, agree that they are satisfied with their job and that they find their work both meaningful and fulfilling. Yet it also reveals that as many as half believe that what happens to them at work is beyond their control and that they have little choice but to simply go along with things. Two thirds find their job stressful and are worn out by the end of the day, and over a third report that they are too tried to do things with others when they come home from work. Three quarters feel pressure to adopt employer goals as their own and constant pressure to perform at high levels. Four in ten report that they are worried that things could change for the worse at work and three in ten worry that they could soon find themselves out of a job. These findings are not entirely unique. Other studies have yielded similar results. But they signal very important underlying problems as to the nature of employment in Canada and, in particular, the ability of employers to exercise unilateral authority free from meaningful constraints. This is an important problem, one that is contrary to what one would expect of an advanced democratic society.

3. Employee rights and protections.

The lack of meaningful constraints on employer authority is also evident when one examines current rights and protections under the law. Particularly serious are the problems of low pay workers. The minimum wage is set so low that, in most if not all jurisdictions, large number of workers still find themselves earning below the poverty level. For example, as of 2004, approximately one in four workers in Manitoba could be categorized under the Statistics Canada low income cut-off (LICO) as in "low pay" jobs (Just Income Coalition, 2005; assuming a 2000 hour work year for an individual living in a city of over 500,000). One in eight workers could be categorized as earning less than half of the median income, which is the OECD poverty line. Pay that is this low may be seen as harmful to personal dignity and freedom regardless of the overall income earned in one's household. Indeed, too many of these workers are effectively consigned to an economic prison, unable to participate in society and lacking in basic necessities, or having to depend on the largesse of others (e.g., family).

Workers in these jobs often do not just have to deal with low pay, however. They also have to deal with arbitrary changes in both the number of hours they work and the scheduling of these hours. This prevents them from being able to properly budget either their money or their time and makes any kind of child care virtually impossible if they do not have somebody to fall back on. But even if they do have somebody, their family life can be so disrupted as to prevent them from performing their normal parenting duties. What makes this especially egregious is that they have no meaningful legal right to ask for allowances to look after their children and if they do ask, they may suddenly find themselves scheduled for fewer hours. The only option for a conscientious parent may be to go on social assistance, but social assistance rates are an absolute disgrace in most jurisdictions within this country, so this is not really an option at all.

To top things off, employees in all but one jurisdiction are legally entitled to only two weeks of vacation per year, unless they have accumulated seniority of at least five years. This compares to six weeks of vacation in a number of European countries and of course is an especially serious problem for low pay workers, because they lack the individual or collective bargaining power to obtain better holidays from employers and often have short job tenures.

I understand that the Review may be considering setting up some sort of system under which workers can contribute to their own benefit plans. This may be helpful for those who are earning significant amounts of money. But for low pay workers, it will be of no use whatsoever. They do not have the money to put into such schemes. The only solution is to either require employers to pay up or, if Canadians do not think this is a good idea, then for Canadians to pay up. Low pay workers have every right not only to decent pay, but also to some form of decent pension plan and to decent drug and dental benefits. Think about, as you grow older, needing things such as root canals or crowns, but having instead to just have a tooth or two pulled every couple of years because you cannot afford proper dental work. Think about having to choose between eating and purchasing drugs needed for your child to function properly.

Canadian workers, whether low pay or otherwise, also have only weak protections against termination and layoffs. Indeed, lower skill workers can be arbitrarily dismissed, without cause, on only two weeks notice or pay in lieu of notice. Moreover, only a third of those who find themselves out of work qualify for employment benefits at any point in time, and these benefits are at most 55 percent of pay or just over 400 dollars per week, whichever is lowest. The maximum that one can hope to receive is roughly equivalent to the Stats Can Low Income Cut-off for a single individual in a city with over 500,000 occupants. For those with any dependents, it falls far short of this cut-off.

While unemployment insurance may be outside of the Review's mandate, it matters because it means that workers who are terminated have little by way of meaningful support, thus heightening their feelings of vulnerability at work. Workers are not cattle. They deserve some meaningful level of job and income security. They also deserve universal due process rights to protect themselves against arbitrary discipline and dismissal -- regardless of whether they are union members. What kind of democracy could deny such rights at work to its citizens?

Finally, workers have few if any a priori (i.e., automatic) information sharing, consultation, or co-decision making rights, even though management decisions can have major implications not just for their economic well-being, but also for their work experience and hence their social and psychological well-being. In more democratically advanced, European nations, such rights are often taken-for-granted. Yet, in Canada, any such rights are generally limited to health and safety issues. Thus, workers have few meaningful legal rights to participate in decisions that affect them, and those who make these decisions are neither elected by nor legally accountable to them. This lack of representation is again especially serious for low wage workers, who lack much in the way of either individual or collective bargaining power and hence have little ability to stick up for themselves. But one would expect meaningful rights for all workers in any country that pretends to be an advanced democracy. It really speaks very badly of this country that workers do not have these rights, and I would go so far as to say that a report that did not advocate significantly stronger information sharing, consultation, and possibly even co-decision rights would by definition be anti-democratic.

4. What can be done?

The urgency of the problems faced by many Canadian workers only truly comes to light once one moves beyond statistics, and actually hears from workers themselves. I chaired an inquiry that recently did this in Manitoba, and it was a real eye-opener (Just Income Coalition, 2005). So I hope that the Review has some mechanism for ensuring that the voices of real workers are actually heard. If they are, it will become evident that the federal government must do something other than simply tinker about with what we already have. It must lead the way towards a new regime, one that establishes strong and meaningful rights and protections for employees under its jurisdiction -- including in areas that it currently leaves by default to the provinces. The question is how to do so. Let me first consider the solution that has underpinned Canadian labour policy for the past half century, which is collective bargaining.

Collective bargaining and union representation have traditionally been viewed as the primary means through which the above sorts of problems could be addressed. In an era in which flexibility is a mantra of employers, this should be the case more than ever, because collective bargaining allows for flexibility that employment laws and standards typically cannot. More important, recent research -- including my own -- indicates that union representation enhances the confidence that workers have in their rights at work and the likelihood that standards are properly implemented and enforced, thus ensuring their effectiveness and minimizing enforcement costs to governments. I cannot think of a better system for ensuring both a decent quality of work life and basic rights and standards for workers.

So unions should clearly be part of the solution. I must say in this regard that I am most disturbed that the federal government would restrict this Review's mandate to employment standards and effectively leave issues having to do with collective bargaining out. Labour and employment laws and policies cannot be separated, for I hope obvious reasons. I worry that, although there is some mention of unions in some of your materials, this Review may be structured in a way that leads it to arrive at essentially anti-union, managerialist solutions that pretend to address worker problems but without any costs to employers and without any meaningful representation and hence enforcement. These sorts of solutions have become especially prominent among advocates of so-called "reflexive" law, and for the most part seem to be fundamentally dishonest, serving more to satisfy government officials and politicians who are fearful of doing anything that might not be popular with the business community. There are, no doubt, some alternatives that may entail "win-win" solutions and hence few economic or political costs. But frankly, providing basic rights for workers typically does not come for free. Trade-offs must be made.

Where I would agree with many, however, is that the current system for collective bargaining has largely failed workers. In the private sector, where workers may be most in need of various rights and protections, less than one in five workers is now a union member, and even where a union is established, its effectiveness in addressing the problems faced by working Canadians is often limited in a number of respects. In particular, a system which is based on bargaining power is unlikely to be of much assistance to those without such power. But even where workers have power, union representation still does not bring any meaningful information and consultation rights, and protections against the unilateral exercise of employer authority are still often much too weak. These problems could -- and should -- be fixed in part through relatively conventional labour law reforms. But I also think that we need to go beyond these reforms to create a system in which all workers, regardless of whether they have a union certified for purposes of collective bargaining, have proper rights and protections. To this end, I would like to propose a paradigm which does not assume a positive sum world, but does assume that any trade-offs need not be large. This paradigm includes a role for unions, but also goes quite a bit beyond what we have at present. I have labelled it the "good practice" paradigm.

5. The Good Practice Paradigm.

As developed in greater detail elsewhere (Godard, 2003), this paradigm is founded on three basic principles that one would expect to observe at work in any advanced democracy yet are often violated due to the nature of the employment relation and the conflicts that underlie it: 1) dignity and freedom, 2) fairness and equality, and 3) representation and voice. The paradigm advocates employer practices that serve these principles and have always in varying degrees been considered to represent "good" management practice. However, it does not assume that it is necessarily in the interests of employers to adopt such practices or that their adoption should be a matter for employer choice. Nor does it assume that such practices should be the subject of collective bargaining. Rather, it is based on the argument that the three principles represent basic rights. Hence, there is need of government policies and laws to ensure that they are realized in virtually all workplaces regardless of employer volition or union bargaining power.

At the same time, the good practice paradigm assumes that it is possible to achieve basic levels of these three principles without unduly negative economic implications. Although the attainment of these principles can have costs for employers, their violation can result in employee deprivation, resentment, and distrust (respectively), all of which can also have negative performance implications. Addressing these potential problems could thus have benefits for employers that at least partly offset any costs. A further assumption is that the magnitude of any such costs or of any resulting benefits is likely to depend in considerable measure on matters of design and implementation, something that is often overlooked by both proponents and critics of stronger labour and employment laws.

Unions could be expected to play a critical role under this paradigm, a role that would extend to workplaces where they are not certified for collective bargaining purposes. First, unions could provide workers with "institutional backup," or in other words, the information, expertise, and resources needed to ensure that they are able to effectively assert their rights and that they could do so without fear of employer retribution. Second, they could be instrumental in the establishment of a more flexible "framework" rights and protections, where government policies and laws allow for a high degree of discretion in how they are implemented, provided that workers have union representation in the implementation process to ensure that this discretion is not abused (e.g., Ozaki, 1999: 55-60). Third, unions would play an important role in helping to enforce these rights and protections, thus reducing enforcement costs traditionally borne by governments.

To further this end, workers would be provided with a universal right to union representation with regard to the implementation and enforcement of good practice policies and laws, regardless of whether there was majority support for a union in their workplace. However, this right would not necessarily extend to include traditional collective bargaining rights, for which majority support and certification might still be required. Thus there would be no necessary change to the established labour law system, only an expansion of this system to include a right for workers to be represented on matters pertaining to good practice laws, a right that would be protected by unfair labour practice laws similar to those currently in place.

With regard to the terms of employment, good practice laws could include, for example, substantial improvements to the minimum wage and related benefits (e.g., vacation times). Decent minimum wage and benefit levels can be seen as critical to ensuring minimum levels of dignity and economic freedom, even for those workers who live in relatively well-to-do households. They may also be important to the attainment of fairness and equality, especially where low wages reflect a surplus of workers competing for the same jobs, rendering these workers subject to exploitation in the labour market. However, to minimize any negative economic consequences from such increases, there could be a temporary or age-based lower minimum wage for workers most likely to suffer such consequences (e.g., those under 18, with limited experience, or with learning deficiencies). Government programs could also be established to assist disadvantaged workers in improving their human capital levels to ensure that they are able to produce at a level equalling or exceeding the new minimum, and there could be forms of government assistance for those unable to reach this level (see Godard, 2001).

In addition to decent pay and benefits, workers could be provided with stronger, albeit more flexible rights with regard to health and safety, working time, and parental leave. They could also be provided with universal grievance and arbitration rights on selected issues, backed up by the right to legal representation, including union representation, in the exercise of these rights. Such rights would be based on codes of "good practice" promulgated by governments, and designed to ensure basic levels of fairness and equality at work, especially with regard to discipline and dismissal, but also, perhaps, to promotions, layoffs, and related issues. In this respect we might refer to violations of these rights as "unfair employment practices," thus paralleling what we now refer to as "unfair labour practices."

A further possibility would be a right for all employees in uncertified workplaces to some form of signed contract with their employer. Employees might be given the right not only to negotiate such a contract at the time of hiring, but also to renegotiate this contract at subsequent intervals, and to do so through a legal representative of their choice, either as individuals or, for those who wish to do so, collectively. This contract would be more specific and confer more rights and obligations on the parties than is currently the case under the law or under most non-union employment contracts. In the event that the negotiations did not succeed or there was a perception that an established contract had been violated, either side would have a right to file a grievance and go to either arbitration or some form of government tribunal.

As a final example, workers could be provided with universal communication and participation rights on selected issues, thus ensuring representation and voice in decisions that affect their well-being. To advocate German -style works councils, as some have done, is unlikely to be taken seriously given Canadian traditions. But universal information sharing and consultation rights on selected issues, such training, layoffs, and changes to work design, might be.

Combined, these sorts of rights could entail a substantial advance beyond the model that has dominated labour policy in Canada since the Second World War. But rather than replacing this model, it would extend many of the legal rights and protections typically assumed to exist in union workplaces to all workers. It would also possibly shift the main role of unions away from having to fight for certification and various attendant rights to one of simply helping to implement and enforce such rights. Moreover, because this role would not require workers to go through the certification process, the presence of a union would be less likely to be viewed as an attack on management or a threat to management's competitive position. Ideally, this would result in less conflictual relations, and unionization would come to be seen as normal, even if with a somewhat different role.

Although these rights would entail a substantial shift, they are not without precedent. In particular, the UK has long had a system of employment tribunals for workers that believe they have been unfairly disciplined or dismissed, and in 1999 it implemented a minimum wage regime similar to the one proposed here. It has also adopted mandatory consultation laws with regard to training and layoffs, and, most recently, legislation to substantially extend information sharing and consultation rights to matters involving employer strategy and workplace change (albeit largely in response to a European Union directive requiring all member states to do so). Although it is too early to gauge the effectiveness of some of these laws, they do not appear to have had any significant negative economic effects, and employer opposition to them appears to have been limited.

The UK experience may be especially relevant given similarities in its traditions and institutions. Nonetheless, good practice rights would need to be implemented gradually and in a way designed to minimize both employer opposition and any negative economic consequences, a task made more difficult by Canada's proximity to the USA and by what would appear to be a more hostile employer culture. Yet the good practice paradigm could be promoted not as serving the interests of any particular group (e.g., labour unions) but rather as advancing Canadian society so that it is more consistent with principles that should be basic to any advanced democracy and are widely adhered to in Europe. It could also be promoted on the grounds that it is simply consistent with what has always been thought of as good management practice and that any negative effects would likely be small at best, as borne out by the UK experience.

It is, of course, not at all certain that such a modest alternative could effectively address the problems currently faced by Canadians at work. But it would ideally help to move things in the right direction, setting Canada on a path or "trajectory" that would gradually lead to the kind of quality of life and working experience that one would hope to see for all Canadians. It could also help to lay the foundation for a more fundamentally democratic culture in the economy and in Canadian society in general. Few could disagree with the development of a more democratic culture at work as a basic requirement for any truly advanced civilization.

References

Godard, John, 2001. Towards a Just and Favourable Minimum Wage: A Matter of Design? discussion paper to submitted to the Hon. B. Barrett, Minister of Labour, Province of Manitoba, Oct. 15, 2001.

Godard, John, 2003 "Labour Unions, Workplace Rights, and Canadian Public Policy," Canadian Public Policy, vol. 29-4: 449-67.

Godard, John, 2005. Industrial Relations, the Economy, and Society, 3rd edition, Toronto: Captus Press.

Just Income Coalition of Manitoba, 2005. Paid to be Poor: The Experience of Low Pay Work and What Can be Done About It, Winnipeg: Social Planning Council, forthcoming.

Ozaki, M. 1999. Negotiating Flexibility. Geneva: the ILO.