Chapter 1: Introduction
WHAT IS INDUSTRIAL RELATIONS?
●
Strike: an action by workers in which they cease to perform work duties and do not report to
work
●
Precarious employment: employment with limited security, lower wages, and less protection
INDUSTRIAL RELATIONS
●
industrial relations: the study of employment relationships and issues between employees,
employers and government agencies. It includes the study of union and non-union employment
relationships.
●
Often used in the narrow sense of labour management relations at unionized workplaces
●
Union: a group of workers recognized by law who collectively negotiate terms and conditions of
employment with their employer
●
collective agreement: a written document outlining the terms and conditions of employment in
a unionized workplace
●
collective bargaining: the process by which management and labour negotiate the terms and
conditions of employment in a unionized workplace
LABOUR RELATIONS
●
the study of employment relationships and issues between groups of employees (usually in
unions) and management; also known as union-management relations
●
primarily focuses on issues related to the union-management relationship, such as collective
bargaining, collective agreements, collective agreement administration etc
HUMAN RESOURCES
●
the study of the employment relationship between employers and individual employees
●
examines topics such as selection, compensation, and training.
EMPLOYEE RELATIONS
●
the study of the employment relationship between employers and individual employees, usually
in non-union settings
EMPLOYMENT RELATIONS
●
the study of employment relationships and issues in union and non-union workplaces
THE INDUSTRIAL RELATIONS SYSTEM
●
The two most commonly used system frameworks in North America are John Dunlop's and Alton
Craig's.
DUNLOP'S INDUSTRIAL RELATIONS SYSTEM MODEL
●
First to develop a systematic method for analyzing employment relationships in North America
●
the model consists of actors, a shared ideology, and contexts, as well as a web of rules.
ACTORS
3 distinct actors:
SPECIALIZED GOVERNMENTAL AGENCIES:
●
role of this actor is to develop, implement, and administer legislation and policies pertinent to
the employment relationship
A HIERARCHY OF MANAGERS AND THEIR REPRESENTATIVES
●
represents the business owners as well as the managers hired to run the business.
●
The role of this actor is to manage the workers and workplace in question.
A HIERARCHY OF WORKERS (NONMANAGEMENT) AND ANY SPOKESPERSONS
●
represents the nonmanagement workers in the employment relationship and any relevant
associations.
●
In most cases, these associations consist of labour unions representing the workers.
SHARED IDEOLOGY
●
Is a set of ideas and beliefs commonly held by the actors that helps to bind or integrate the
system together as an entity
●
seen to define the role and function of each of the actors and required that all three actors
respect and value the roles of the other two.
CONTEXTS
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envisioned that the three actors might be influenced by any of several environmental contexts.
MARKET AND BUDGETARY CONSTRAINTS
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two key areas as critical to the employment relationship: product and labour
●
Unions seek to influence both the supply of and demand for labor, which affects employee
wages and the cost of the product or service produced by the organization. This makes
budgetary constraints important, particularly for management
TECHNICAL CHARACTERISTICS OF THE WORKPLACE AND WORK COMMUNITY
●
Focuses on how work is structured and performed, including such factors as the processes used
to produce goods and services, the stability of the workforce and operations, the size of the
workgroup, job tasks, hours of work, and the technology/machinery used.
DISTRIBUTION OF POWER IN THE LARGER SOCIETY
●
examines the power relations among the actors within a particular employment relationship in
the broader society.
●
power is important because the actor with the most power will have the greatest ability to
influence both the dynamics of the employment relationship and the terms and conditions of
employment.
●
distribution of power among the actors reflects "their prestige, position, and access to authority
figures within the larger society [that] shapes and constrains an industrial relations system."
WEB OF RULES
Dunlop's system framework for industrial relations includes a complex and contested web of rules that
define the rights and responsibilities of the actors involved in the employment relationship. There are
three key elements concerning these rules.
PROCEDURES FOR ESTABLISHING RULES
●
focuses on the processes used for making the rules and on who has the authority to make and
administer the rules that govern the workplace.
SUBSTANTIVE RULES
●
These rules pertain to the outcomes of the employment relationship
●
for example, for the employee, compensation, job and performance expectations, and worker
rights and duties.
PROCEDURAL RULES
●
procedural rules are those that determine or apply substantive rules, such as rules regarding
wages, work schedules, and vacation time.
●
are often included in collective agreements in unionized workplaces.
CRITICISMS OF DUNLOP'S INDUSTRIAL RELATIONS SYSTEM
1. it lacks the ability to predict outcomes and/or relationships.
2. underestimates the importance of power and conflict.
3. static in nature.
○
At no point does it examine how events in one employment relationship can impact
other employment relationships, or even the same relationship at a later time.
4. cannot explain the rapid decrease in unionization
○
the framework is often assumed to ground itself in the premise that unionized
workplaces are the norm
Summary
●
One of the most studied expansions is Craig's model, which is similar to systems models used in
biology.
●
Craig's model sees industrial relations actors taking inputs from the external environment and
converting them into outputs through a series of conversion mechanisms, which flow back into
the environment through a feedback loop.
EXTERNAL INPUTS
●
The left-hand side of the model shows that several external inputs (or environmental
subsystems) are important elements of the industrial relations system.
●
These inputs can be legal, economic, ecological, political, or sociocultural.
LEGAL SUBSYSTEM
Three areas of law are key to the study of employment relationships:
●
common law, which is the earliest form of employment law and applies to nonunion
employment relationships;
●
statutory law, or laws pertaining to both union and non-union employment relationships; they
include minimum employment standards (e.g., minimum wage) and employment discrimination
(e.g., discrimination based on race, gender, and sexual orientation); and
●
collective bargaining law, or legislation pertaining to unionized employment relationships.
Canada has a decentralized legal framework, with most provinces having their own provincial laws
ECONOMIC SUBSYSTEM
four key elements to this subsystem: product/ service markets, labour markets, money markets, and
technology
PRODUCT/SERVICE MARKETS
●
The availability of products or services from competitors and an organization's competitive
position in its market are important elements of product/service markets in industrial relations.
●
The shift towards internet-based shopping has led to increased competition from firms around
the globe, affecting Canadian retailers.
●
Competitive factors in the product/service market can play a significant role in collective
bargaining proposals, with employers often considering the impact of wage increases on total
product/service costs and how they compare to competitors' costs.
LABOUR MARKETS
●
characterized by the supply of and demand for workers with the required skills for a particular
workplace.
●
Unions and management often consider the number of employees available and needed when
negotiating employment practices, such as the use of contract labour.
MONEY MARKETS
●
The Canadian economy is affected by global issues, particularly those related to the United
States, and this impacts the industrial relations system.
●
Money markets play a key role in the economy, and actors in the industrial relations system can
be impacted by them, even if they are not involved in exporting or importing products and
services.
●
The Bank of Canada can adjust interest rates on the basis of exchange rates, and this can impact
inflation.
●
exchange rate: the value of one country's currency relative to another country's currency
●
interest rate: the rate a bank charges for borrowing money
●
Inflation: the increase in prices over time
TECHNOLOGY
●
Technology can affect the industrial relations system in various ways, including introducing new
work methods, job redesign, and layoffs.
●
It allows work to be done anywhere in the world and can reduce the number of employees
needed.
●
There are concerns that AI may greatly affect the demand for and type of employees needed in
the economy.
●
Collective agreements often include specific language related to technological changes in the
workplace.
ECOLOGICAL SUBSYSTEM
●
includes the physical environment, climate, and natural resources that influence actors and the
industrial relations system.
POLITICAL SUBSYSTEM
●
The political subsystem in Canada is based on democracy, where citizens elect politicians to
represent them at various levels of government who can pass legislation.
●
in the industrial relations field, governments use legislative action to create and amend
legislation related to employment issues, such as ending mandatory retirement.
●
mandatory retirement: a requirement that employees retire at age 65
●
Governments can also use executive action, like passing emergency legislation to end a strike,
and there is an increasing trend of using back-to-work legislation in the public sector.
SOCIOCULTURAL
●
The values and beliefs of society can impact the actors in the industrial relations system and
shape their perceptions of what is fair and appropriate in the employment relationship.
●
Public opinion surveys are often reported in the media during large strikes, and comments
posted on media stories can be used by both labor and management to gauge public support for
their positions.
ACTORS
The actors in the industrial relations system are influenced by the previously discussed external inputs.
The actors shown in Figure 1.1 in many ways mirror those offered by Dunlop (1958) and include
●
labour (employees and their associations);
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employers and their associations; and
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government and associated agencies.
INTERNAL INPUTS
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The values, goals, strategies, and power of actors within the industrial relations system can
influence the system itself.
●
Employers may prioritize profitability and competitive advantage, while labor may prioritize fair
treatment of workers.
●
These values influence the goals each party develops, such as maximizing efficiency for
employers and maximizing equity for labor.
●
Strategies are then developed to achieve these goals, and the relative power of each actor
determines which party's goals are ultimately achieved.
●
Goal: that which a person seeks to obtain or achieve
●
Strategies: processes developed and implemented to achieve goals
●
Power: the ability to make someone agree to your terms
CONVERSION MECHANISMS
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Conversion mechanisms: the processes used to convert inputs into outputs of the industrial
relations system
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Collective bargaining, the process by which the parties negotiate a collective agreement.
●
Day-to-day relations. That is, the day-to-day activities in the organization represent conversion
mechanisms; for example, prior to launching a formal grievance, a worker may meet directly
with his or her manager to resolve an issue.
●
Conflict resolution mechanisms, such as grievance procedures. A grievance procedure allows
employees (and/or their union) to submit a written complaint that the collective agreement has
not been followed.
●
Various third-party dispute resolution interventions:
○
Interest arbitration. A third-party process used when parties cannot reach a collective
agreement on their own. The decision of the arbitrator(s) becomes a binding collective
agreement. This process is most often used by actors who are forbidden to strike by law
(e.g., police, firefighters).
○
Mediation. A process whereby a third party attempts to facilitate a resolution between
labour and management. Note that mediators do not have the power to enforce a
resolution.
○
Grievance arbitration. A third-party resolution process used when employers and labour
cannot resolve a grievance in a mutually acceptable manner. In such cases, the
arbitrator(s) makes a final and binding resolution to the conflict at hand.
○
Conciliation. In many Canadian labour relations laws, a conciliator must assess the
proposals of both employers and labour and submit a report to the appropriate federal
or provincial labour minister prior to a strike/ lockout taking place.
●
Joint committees. Many organizations have joint labour-management committees to examine
issues of common concern, particularly health and safety.
●
Other workplaces use committees for broader issues, and some jurisdictions, such as
Newfoundland and Labrador and British Columbia, even promote their use and provide
assistance in establishing such committees (Advanced Education, Skills and Labour, 2018; Labour
Relations Board British Columbia, 2018).
●
Strikes and lockouts. Work stoppages can be both a conversion mechanism and an outcome.
When used as a conversion mechanism, strikes and lockouts are used to bring closure to the
negotiation process and produce a collective agreement.
OUTPUTS
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The outputs of the industrial relations system refer to the results or outcomes of the conversion
mechanisms and may be captured in a collective agreement between labor and management.
●
Elements that can be considered outputs of the industrial relations system include, but are not
limited to, the following:
○
Employer outcomes. For example, the rights and responsibilities of management in the
employment relationship, as well as efficiency elements (productivity, profitability, etc.).
○
○
Labour outcomes. Equity issues or ways to instill fairness in the workplace, including
■
the rights of, and security for, the union;
■
hours of work, including schedules and overtime;
■
wages and benefits;
■
job rights (e.g., job assignment and selection, layoff provisions, seniority); and
■
work rules, or rules that employees and employers are expected to follow.
Worker perceptions. Workers' reactions in terms of
■
work climate, or workers' sense of the overall work environment in the
organization at hand;
■
employee morale and organizational commitment, or the extent to which
employees are satisfied with and committed to their organization and
workplace; and
■
union satisfaction and commitment, or the extent to which employees are
satisfied with and committed to their union.
○
Conflict. An output of the system can be conflict (e.g., strikes and lockouts).
VIEWS OF INDUSTRIAL RELATIONS
Lecture:
An interdisciplinary field
●
economics
●
law
●
history
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sociology, psychology
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political science
NEOCLASSICAL ECONOMICS VIEW
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a view of industrial relations grounded in economics that sees unions as an artificial barrier to
the free market
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examines "the application of basic principles of neoclassical economics to . .. the market for
labour services."
●
emphasizes factors concerning the supply and demand of labour, or workers.
●
The "free market" assumption governing this economics view is that the number of people
willing to work at a given wage rate (i.e., labour supply) is equal to the number of workers
needed by organizations (i.e., labour demand).
Lecture
●
When you discuss the collective agreement, the most important part of the agreement is the
wages (how much an employer should pay for their employees).
●
They think how much an employee can earn based on the free market, supply and demand but a
union is an artificial barrier to that.
●
Theres some debate about whether unions can increase or decrease productivity
PLURALIST AND INSTITUTIONAL VIEW
●
a view of industrial relations stressing the importance of institutions and multiple actors
(including labour) in the employment relationship
●
believes that labour unions act as a countervailing force that attempts to balance the interests of
employers and employees.
●
Has been the predominant view of IR in Canada
●
Institutions are important because they believe that employers have more power than
employees. So for the relationship between employer and employee to be fair, the government
must play a role in that
HUMAN RESOURCES/STRATEGIC CHOICE
●
The strategic choice perspective suggests that the American industrial relations climate shifted in
the 1970s and 1980s, away from unionization towards non-unionized employment relationships,
and employers implemented strategies to minimize unionization and the role of collective
bargaining.
●
A key element of this perspective is the importance of human resources strategies and practices
linked to the firm's overall business strategy, which are often designed to foster cooperation
between employees and employers and minimize the need for unionization
●
Believe that HR can achieve all the benefits of a unionization
●
Dont like union
POLITICAL ECONOMY
●
a view of industrial relations that stresses the role of inherent conflict between labour and
management
●
The political economy perspective sees the inherent conflict between employers and employees
and is grounded in sociology and political science, unlike the pluralist and human resources
perspectives that are seen as minimizing the conflict.
●
This view has been prevalent in Europe and emphasizes class struggle and societal and political
factors.
●
The perspective emphasizes the need to examine the actions of management, labor, and
governments.
●
Believe that there's no way to make the conflict between labour and management disappear
Lecture
Why study industrial relations
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Decreased from 1997 to 2019
●
The unionization rate Increased last year in Canada 1.1% to 29.4
●
In Canada, the unionization rate is 40% compared to the U.S where the rate is 9%
●
2020 big increase was due to the concentration of job losses among non-unionized private
sector employees during covid 19 pandemic
●
With private-sector employment recovering, the rate fell by 0.4%
●
1997 to 2021, the decrease in rates was driven by the private sector
●
For the private sector, the unionization rate is decreasing but for public, it is increasing
●
Almost one-third of the working population in Canada works in unionized environment.
●
Over 70% of the public sector unionized.
●
Chances are you will quite likely be working in or dealing with people working in unionized
workplaces.
●
Even a manager working in a non-union HRM firm needs to be aware of how a union is formed
and what employer response is appropriate during a union organizing drive.
Why industrial relations is important
●
In IR we study employment relations in unionized companies and in non-unionized companies
too
●
1. Can promote democracy because industrial relations means using collective bargaining to
settle problems faced by workers or to settle disputes or complaints from workers so collective
bargaining is usually achieved through mutual coverage, cooperation and mutual agreement
among all parties affected such as managers, employees, and unions. Therefore, it motivates the
workers who contribute their best to the growth and prosperity of the organization for the good
of all parties
●
2. It can boost employee morale. It is important to know they’re good in the actual industrial
relations which are built in mutual agreement or mutual cooperation between workers and
employers. So there is a commonly agreed approach that motivates the employees who
contribute, ones that result in higher productivity and more income, give more job satisfaction
and help improve the morale of the workers
●
3. It can avoid conflict between management and unions because when there is some conflict,
people can refer to the collective agreement. So this involves setting up machinery or each
instrument to solve problems confronted by managers and employees. This results in widening
any surprises that could lead to major conflicts between employers and trade unions. Because
collective agreements are so diffuse and are supposed to be fair because it is negotiated
between labour and management. This agreement could have a wide unfair practice for
employers which normally leads to major conflict because the parties are fair and the cause of
agreement and there is not much conflict between employers and employees when the
agreement is still in force
●
Fair liberalization. It encourages fair labour legislation. IR necessitates the passing of certain
labour laws to protect and promote the welfare of labour and safeguard that interests all the
parties against unfair practices from employers
●
IR can ensure that there is uninterrupted production. Can ensure that there is no interruptions
for work or for production. Ttc worker strike
The IR Systems Framework
●
The economic environment is important (labour market), especially labour demand and supply.
This can change IR in certain times or areas of the country. The money market tries to fight
inflation because exchange rates can change the price of our products. If Canadian dollars are
weak, that means our exports will be cheaper but imports will be more expensive
●
Political and legal environment - legal is important because we have minimum wages in Canada
and those can directly impact labour supply and demand. This will impact the interest relate, the
quality of IR or employment relations in certain companies
●
Actors - are important stakeholders. Actors have their own goals, values, power and history
●
Outcome: whether the union is recognized or not in a certain company. If they unionize, they will
have a collective agreement and the due process to conflict resolutions are strikes and a lockout.
So when the negotiation of a new agreement is not successful, the matter distracts and the
lockout
Why Starbucks, apple and Google are unionizing now for the first time?
What it takes to form a union
●
when a group of employees decide they want to unionize, they first need to collect their
colleague's signatures on authorization cards. Once they get at least 30% of workers to sign,
employees file a petition for an election with the national labor relations board. If the majority
of employees vote for the union in the secret ballot election, it wins. Both sides have a week to
file objections to how the election took place then it usually takes months or years for both sides
to negotiate in good faith and reach a first contract
Benefits a union can bring
●
Workers United has created a $1 million fund to support Starbucks workers who lose wages as a
result of organizing activities
●
Two-thirds of Americans support unions
●
Apple raised starting pay for retail workers from 20 to 22 an hour, 45% jump since 2018.
Unionized workers are asking for 26 to 28 an hour
●
In May 2022, Starbucks announced wage increases and increased training but only for stores
that haven't unionized
●
Workers and unions make on average 16.6% or nearly $200 more per week than non-union
workers
●
Starbucks employees want improvements to benefits such as comprehensive mental health
benefits
IR System chart reflecting video
●
Economic - starbucks workers want to be unionized because durin pandemic they lost jobs and
the inflation is high. They want living wages, better benefits
Chapter 3: ECONOMIC, SOCIAL, AND POLITICAL ENVIRONMENTS
an environment of industrial relations helps shape the labour-management relationship and such system
outcomes as wages, benefits, work rules, and conflict.
THE ECONOMIC CONTEXT
MACROECONOMIC POLICY
●
most important single influence on industrial relations has been the federal government's
macroeconomic policy
●
Macroeconomic policy: a policy that applies to economy-wide goals, such as inflation,
unemployment, and growth
●
Almost all industries have been affected either directly through deregulation or privatization (or
both) (e.g., trucking, airlines, communications) or indirectly through policies that promote free
trade in goods and services (e.g., the Canada-United StatesMexico agreement (CUSMA)
●
Deregulation: a policy designed to create more competition in an industry by allowing prices to
be determined by market forces
●
Canada-United States-Mexico agreement (CUSMA) a trade agreement among Canada, the
United States, and Mexico that was signed on November 30, 2018, but not yet ratified by any of
the three countries (called USMCA by the US)
●
Globalization has led to increased capital mobility, as well as the flow of goods and services,
resulting in heightened competition among firms and nation-states to attract foreign investment.
However, labor markets also face other pressures, such as technological advancements,
industrial restructuring, just-in-time delivery systems, deregulation, privatization, public sector
cutbacks, and the constant threat of recession
THE LABOUR MARKET
●
In non-unionized firms, employee compensation and working conditions are primarily influenced
by labor market dynamics.
●
If the supply of labor fails to keep up with the demand due to population growth and
immigration, it will lead to lower economic growth.
●
maintaining our current high standard of living becomes challenging unless there is a balance
between labor supply and demand.
SUPPLY AND DEMAND FRAMEWORK
3.1
●
labour market equilibrium in which the supply (SS) and demand (DD) curves for labour
determine the quantity of labour supplied at the competitive wage (We) and employment level
(Ne). If the demand for labour shifts to D1D1 due to external factors
●
The new equilibrium shows higher wages (Wcl) and a higher employment level (Ncl).
ELASTICITY OF SUPPLY AND DEMAND
●
The impact of a demand shift depends on the slope of the supply curve (SS).
●
A steeper supply curve, referred to as an inelastic supply of labor, leads to a greater increase in
wages resulting from a demand shift.
●
a flatter supply curve indicates an elastic supply of labor, where a small increase in the wage rate
leads to a significant increase in labor supply.
●
Proportions or percentages are used to measure elasticity since wages and labor are measured
in different units.
●
elasticity of supply (demand): the labour responsiveness of supply (demand) caused by a change
in the wage rate; for example, if a small increase in wages causes a large increase in the supply of
labour, the supply curve is said to be elastic
●
The concept of elasticity also applies to the demand for labor. A steeper demand curve indicates
inelastic demand, where a small increase in the quantity demanded leads to a significant
increase in wages. Conversely, a flatter demand curve represents elastic demand, meaning that a
large increase in labor demand has a relatively small impact on the wage rate.
LABOUR-POWER AND MARSHALL'S CONDITIONS
●
shape of the demand curve is significant as it affects a union's ability to increase wages while
minimizing the impact on employment levels, known as the wage-employment tradeoff.
●
The shape of the demand curve influences labor power.
●
According to economic theory, the demand for labor is a "derived" demand, meaning it is
determined solely by supply and demand forces in the market for the firm's product.
4 theoretical conditions determine the wage elasticity of labour, specifically the responsiveness of
employment to an increase in wages.
PRODUCT MARKET
●
The competitiveness of the product market determines the employment impact of wage
increases and the elasticity of labour demand.
●
When a union raises wages, higher costs can lead to reduced sales, decreasing labour demand.
●
unions have more bargaining power in industries with less competition in the product market. In
industries where firms have some degree of monopoly power, they can absorb wage increases
without significantly affecting employment levels. Monopoly power allows them to raise prices
without experiencing a significant decline in sales or employment.
●
free trade reduces union power by increasing market competition.
●
The less elastic the labour demand, the less employment is affected by wage increases,
increasing union power.
SUBSTITUTION EFFECT
●
The ability to substitute capital (machines, technology, etc.) for labour influences labour's power
to negotiate higher wages.
●
Firms that can readily replace labour with other factors of production have more bargaining
power.
●
Ex. airlines can't function without pilots
LABOUR INTENSITY
●
labor intensity refers to the extent to which labor costs contribute to overall production costs.
Industries with a high proportion of labor costs relative to total costs are considered
labour-intensive.
●
The employment impact of a wage increase is lower in industries where labor costs form a
smaller proportion of total costs, giving labor more bargaining power.
●
highly capital-intensive industries have more bargaining power because firms can absorb wage
increases without significant impacts on total costs and employment.
●
public services that are highly labour-intensive, such as police and teachers, tend to have less
bargaining power.
MARKET FOR SUBSTITUTES
●
the more competitive the market for substitute factors of production is, the greater the
bargaining power firms will have.
●
The cheaper and more available these substitutes, the greater the impact on employment, and
hence the greater the employer's bargaining power.
●
demand is more inelastic, and unions will have more power, when
○
product markets are less competitive;
○
labour costs are a small proportion of total costs;
○
the market for substitutes is less competitive; and
○
it is harder to substitute labour for capital.
NONECONOMIC SOURCES OF UNION POWER
●
Unions are more powerful when they build strong links with their local communities
●
Research: unions have successfully forged alliances with community groups to
○
assist in organizing new members;
○
strengthen positions in bargaining;
○
support political lobbying campaigns;
○
oppose plant closures; and
○
support strikes and other industrial actions
SUPPLY OF LABOUR
●
What factors in society determine labour supply?
○
The number of workers is a function of such elements as population growth,
immigration, retirement choices, work-family decisions, career patterns, leisure choices,
and labour mobility.
POPULATION AND IMMIGRATION
●
Labor-force growth is driven by population growth and immigration.
●
Population growth is determined by the difference between births and deaths, along with net
immigration (immigration minus migration).
●
Female fertility rates play a crucial role in determining future labor force growth.
●
economic prosperity relies on labor force growth, which, due to low fertility rates, necessitates
reliance on immigration.
WORK-LEISURE DECISIONS
●
Economists view leisure and work as a tradeoff choice.
●
A wage increase can affect leisure through substitution and income effects.
●
Higher incomes can lead to substituting leisure for work but can also make both leisure and work
more desirable.
●
Long-term trends in hours worked show the dominance of the income effect.
●
In Canada, average hours worked declined from 58.6 hours in 1901 to 39.2 hours in 1981.
●
From 1979 to 2000, average annual hours worked in Canada decreased by only 1.7%.
●
Canada's stability in hours worked contrasts with significant decreases in countries like France,
Germany, Japan, and Norway.
●
The United States and Sweden experienced an increase in average hours worked.
●
In Canada, the slight decrease in hours worked suggests that the income effect is slightly greater
than the substitution effect.
NON COMPETITIVE AND INSTITUTIONAL FACTORS
NONCOMPETITIVE FACTORS
●
Monopsony occurs when a firm is the sole market buyer of a good, service, or labour
●
Monopsonistic markets result in lower wages and employment levels (teachers, nurses)
●
Policy Remedies for market imperfections include unionization and minimum wage laws.
●
An analysis of the interprovincial movement of labour in Canada identified several barriers to
mobility. The probability of individuals changing provinces from year to year during 1982-1995
was lower if
○
the person's home province had a large population;
○
language was a factor;
○
the person lived in a larger city versus a smaller city, town, or rural area;
○
the person was older, married, or had a family;
○
the provincial unemployment rate was low or there were low levels of individual
unemployment insurance or social assistance; and
○
●
the person was a prime-age male with a low income.
Remained stable but men's mobility rates slightly declined while women's rates remained steady
or slightly increased over the fourteen-year period
●
Lack of labour mobility has been linked to increased wage inequality in international trade
agreements.
INSTITUTIONAL BARRIERS TO SUPPLY
●
there are institutional barriers that hinder the supply of labor.
●
Governments may contribute to these barriers by allocating insufficient resources to training or
higher education, leading to a limited supply of graduates in specific occupations or professions
●
Research: occupations establish barriers to entry to control supply and impact earnings.
●
Professional associations and craft unions employ tactics like licensing, certifications, association
memberships, and educational credentials to limit entry into the occupation.
UNIONS AND LABOUR SUPPLY
●
Craft unions' control over labor supply through apprentice programs and hiring halls has mixed
effects.
●
hiring halls a union -run centre that refers union labour to job sites as requested by firms
●
Without proactive government regulation, minority and women representation in unionized
construction work may be limited i
●
In the United States, unions have positive effects, leading to higher graduation rates for women
involved in joint union-management apprentice programs.
●
Apprenticeship training and hiring halls contribute to increased union productivity and better
work conditions.
●
Unions in Germany indicate that by imposing minimum wages and wage compression, unions
increase on-the-job training
DEMOGRAPHIC FACTORS
●
Demographic factors have a significant influence on labor force patterns.
●
Canada experienced a postwar baby boom between 1947 and 1966 which created challenges for
organizations
●
The large baby-boom cohort disrupted the traditional hierarchical management structure and
conventional career paths.
●
A mismatch between the structure of the labor force and organizational needs emerged in the
1980s.
●
Organizations addressed this mismatch by flattening hierarchies and adopting spiral career
paths.
●
These strategies provided greater flexibility and enabled organizations to adapt to the changing
labor force.
SOCIAL CONDITIONS
PUBLIC ATTITUDES TOWARD UNIONS
Some argue that labor unions are no longer useful organizations and their decline is seen as an inevitable
result of multiple factors
●
globalization and greater pressure on firms to be competitive;
●
more individual protection under employment laws;
●
changes in the nature of work, with employees exercising greater control over scheduling (e.g.,
telework, self-employment); and
●
improved human resources practices geared toward individual needs.
●
Data shows that support for unions is high in the U.S
●
In Canada, most recent poll conducted in 2013 b showed results comparable to the US Gallup
polls.
●
A majority (56 percent) of Canadians hold favorable views of unions, and 70 percent believe that
unions are still necessary.
●
This support for unions contradicts the notion of a long-term decline in the demand for
unionization.
WORK ATTITUDES
●
Demand for unionization may stem from workers' dissatisfaction with their jobs
●
Survey:
○
workers seek unions for reasons beyond economic factors or job dissatisfaction.
○
The desire for a collective and independent voice in the workplace remains strong
among Canadian and American workers, even in the face of significant changes in work
organization, labor force composition, and the individualization of human resources over
the past few decades.
TRENDS IN INCOME DISTRIBUTION AND POVERTY
●
Critics argue that globalization and free trade policies have led to an increasing income gap
between the rich and poor.
●
Restructuring policies have particularly negative effects on workers who lack the necessary skills
to compete in the changing economy.
●
This has raised concerns about income inequality and its impact on economic growth. The
replacement of high-paying manufacturing jobs with lower-paying service sector jobs is seen as a
factor contributing to a shrinking middle class and widening income disparities.
●
In Canada, child poverty rates have been a concern, although there has been a recent decrease.
●
Income inequality has become a global issue, with evidence showing that wealth and income are
increasingly concentrated among the high-income group in industrialized economies.
●
This inequality harms economies, societies, and politics.
●
Union decline has been linked to wage inequality in the United States, and studies have shown
increased polarization among male workers and declining earnings for middle-income earners.
●
Gini coefficients, which measure income inequality, reveal that countries like South Africa, China,
and India have the highest levels of inequality, while Scandinavian and European nations have
lower inequality due to their social safety nets and progressive taxation policies.
●
disposable income: income after taxes and benefits from social programs (e.g., unemployment
insurance payments)
CHANGING WORKFORCE COMPOSITION
Summary of changes over the last 70 years
●
Canadian labor market has undergone significant changes since the 1950s.
●
Advancements in computer-based technologies have led to workplace automation, while
globalization and the economic rise of countries like China and India have reshaped industries
and increased international trade.
●
The proportion of workers in unionized jobs, manufacturing jobs, and those covered by
employer-sponsored pension plans has decreased. However, Canadian workers today have
higher levels of formal education compared to the 1950s.
●
increase in women's participation. Over the second half of the 20th century, more women
entered the workforce due to changing gender norms, technological advancements, smaller
family sizes, and increased employment opportunities in the service sector.
●
From 1953 to 1990, the labor force participation rate for women steadily grew from about 24%
to 76%, while the rate for men slightly declined from 96% to 93%.
●
In order to prevent labour shortages caused by inadequate labour force growth and low fertility
rates, Canada has increasingly relied on immigration
AN AGING POPULATION
●
From 2011 to 2016, Canada experienced its largest increase in the proportion of seniors since its
formation. This was due to the first wave of baby boomers reaching 65.
●
The age pyramid of 2016 shows the post-World War II baby boom, followed by smaller
generations, millennials (aged 15-34), and a growing number of children aged 5 to 9 resulting
from increased births between 2006 and 2011.
●
consequence of the aging population is an increase in poverty for persons older than 55
●
Poverty is on the rise among elderly families
EMPLOYER CHALLENGES TO WORKFORCE AGING
●
Hr and skills development recommendations for employees
●
It is contemplated that policies and/or collective agreements (if a union is present) might permit,
enable, and legitimize the following:
○
elimination of age discrimination; adoption of proactive measures in the workplace, in
human resources practices;
○
safer workplaces, healthier environments, a holistic approach to wellness;
○
flexible work arrangements, job redesign;
○
appropriate training opportunities; and
○
flexible retirement options. (ESDC, 2005)
IMPACT OF COMPOSITIONAL CHANGES ON UNIONS
MORE WOMEN
●
proportion of women in unions has significantly increased from 12 percent in 1977 to 48 percent
in 2004. By 2012, slightly more women than men were union members or covered by a collective
agreement, with 32.8 percent of women and 30.3 percent of men represented.
●
This change is attributed to the growth of the services sector and the decline in manufacturing
during that time
OCCUPATIONAL SHIFTS
●
unions have made significant gains among women, youth, and workers in public administration
and in the fast-growing childcare and home support sectors.
●
unions lost members in manufacturing and in the technical health fields (medical, dental,
veterinary, therapeutic).
CONTINGENT WORKERS
Five types of alternative work arrangements:
1. Part-time. when the number of hours worked at the main job is usually less than thirty hours per
week.
2. Contingent. 2 major categories of workers: (1) those who have traditionally worked on a
temporary or casual basis, and (2) a smaller but growing group of professional and technical
contingent workers who desire the freedom and flexibility provided by contingent work
3. Flextime. permits employees to start earlier or later as long as the required number of hours are
worked per week
4. Compressed work weeks. involves reallocating the work time by condensing the total hours in
the traditional work week into fewer days
5. Teleworking. may involve working at home, at a satellite work centre, or in some other
non-traditional workplace, either full- or part-time, and using telecommunications and the
electronic processing of information
LABOUR AND EMPLOYMENT RELATIONS CHALLENGES
●
new work arrangements has led to a significant shift in the composition of the workforce in
many companies, posing challenges for labor and employment relations
●
Traditional collective bargaining was designed for stable, full-time employment relationships.
●
The shift towards part-time and contingent work favors management in the balance of power.
●
Even if unions organize these new employee groups, labor boards may not consider them eligible
for a single bargaining unit due to a lack of shared interests.
●
Employees in non-core categories face difficulties as existing laws may not apply to them.
●
Many employment laws have minimum thresholds for benefits that may not be met by these
workers.
WORK-LIFE BALANCE
●
work-life balance (WLB): the desire on the part of both employees and employers to achieve a
balance between workplace obligations and personal responsibilities
●
Work-Life Conflict (WLC) arises when the demands of work and nonwork roles are incompatible,
making it challenging to participate fully in both.
●
WLC has three components
○
role overload;
○
work to fami{y interference (i.e., long work hours limit an employee's ability to
participate infami{y roles); and
○
family interferes with work (i.e., family demands to prevent attendance at work).
Environmental changes
ECONOMIC
●
The Canadian economy has undergone a significant restructuring, transitioning from
manufacturing to a service-based economy.
●
This shift is seen in many industrialized nations and has been influenced by factors such as free
trade. As part of this restructuring, contingent work has increased.
●
Firms are facing pressure to be more flexible, which has led to the elimination of work rules and
reduced economic rewards. Deregulation, outsourcing, and labor shortages have also impacted
industrial relations.
SOCIAL
●
work-life balance will be affected by such issues as daycare needs; increases in workload,
including multitasking; job insecurity; and employers' pressure for more flexibility.
●
Firms are concerned about work-life issues because they affect the bottom line through
increased absenteeism, benefit costs, and reduced productivity.
DEMOGRAPHIC
●
more women, an aging workforce, various baby-boomer effects, changing immigration patterns,
and the growth of contingent work.
THE POLITICAL ENVIRONMENT
●
Unlike the United States, the Canadian labor movement has experienced a more successful
organization of new members and has avoided a significant decline in union density. This
difference can be attributed to the more labor-friendly laws in Canada, as well as the political
support received by labor from certain political parties.
●
In Canada, the New Democratic Party (NDP) has historically supported labor in English-speaking
regions, while the Parti Quebecois (PQ) and Quebec Solidaire have shown support in Quebec.
Two structural elements of the Canadian political system have made it possible for labour parties to
translate their pro-labour policies into legislation
1. The labor laws in the United States are uniform for the entire private sector, which limits the
ability to bring about legislative changes. Only two amendments have been made to the Wagner
Act since its enactment in 1935. In contrast, Canada has multiple labor laws due to labor being a
provincial matter, resulting in eleven laws, including the federal jurisdiction. This decentralized
structure increases the likelihood of legislative changes. Additionally, the New Democratic Party
(NDP) has held power in four provinces and has influenced minority governments, further
enabling legislative actions.
2. The parliamentary system of government. Unlike the American two-party system, the Canadian
political system allows for the involvement of multiple parties and the possibility of minority
governments. In Canada, smaller parties can hold significant power and influence, even if they
are not the governing or official opposition parties. In a minority government scenario, the
largest party can form a government with the support of smaller parties. However, the smaller
coalition partners typically have specific demands that must be met for the coalition to function
and the arrangement to endure.
Labour in Canada has leveraged its political affiliations with the NDP and the PQ in Quebec to achieve
significant legislative victories, thanks to the parliamentary system and constitutional fragmentation. For
instance, in Saskatchewan, the NDP labour association played a pivotal role in introducing the first
collective bargaining legislation for public employees in Canada. Unlike the United States, Canada
implements a card system of certification in five out of eleven jurisdictions, including the federal level,
Manitoba, Quebec, Prince Edward Island, and New Brunswick. This card system has been linked to
successful union-organizing campaigns
there have been three important social and historical experiences that have caused Canada to reject US
opposition to collective bargaining:
1. The 1982 Canadian Charter of Rights and Freedoms protected individual rights but also
facilitated collective bargaining.
2. Even with similar legislation in the United States, American firms in Canada are more restricted
when it comes to anti-union activities.
3. Canada has rejected the US right-to-work approach, which prevents unions from forcing
nonmembers to join or pay dues despite enjoying the benefits of unionization.
GLOBALIZATION AND POLITICS
●
Globalization exerts pressure on governments to align with international policy norms, limiting
the policy autonomy of provincial governments. Trade liberalization policies are expected to
drive the convergence of labor policies, as deviating too far from international norms may deter
foreign and domestic investment, impacting economic growth. This convergence theory finds
support in Canada, where conservative governments in provinces like Saskatchewan, Ontario,
and British Columbia have adopted aspects of the US labor model, such as replacing the card
system of certification with the mandatory voting system of the Wagner Act. However, the
election of an NOP provincial government does not guarantee progressive changes in labor
legislation, as demonstrated by the controversial amendments to labor laws under the NOP
government in Manitoba.
Lecture Slides
Supply and Demand Model
●
Also known as labour supply and demand
●
Competitive Labour Market
●
Labour markets can be divided into two components
○
Demand for Labour
■
○
Supply of Labour
■
●
Action and desires of employers for workers
Decision of workers, whether to work or not
Equilibrium Wage in S&D model
○
Occurs in the labour market when the quantity supplied equals the quantity demanded
●
Interaction of slope of labour supply and demand
●
E - equilibrium
●
We - equilibrium wages
●
Le - labour equilibrium (Labour in the markets of being hired) (quantity)
When we talk about the basic model, we have to keep in mind that we have assumptions to make this
model work
●
Competitive Labour Market
○
●
Refers to basic supply and demand model
Assumptions of Competitive Labour Market Model
○
“Large” number of employers
■
○
Large number of firms competing to hire a specific type of labour hire
Numerous people with homogeneous skills
■
The same skills that independently supply their labour service. So they are not
influenced by others and can make their own decisions
○
○
Employers are wage takers
■
i.e. the wage is set by “the market” not by the individual employer
■
This doesn't always work because Sometimes employers have power
No artificial barriers to entering an occupation
■
So everyone in the market has a perfect cost of this information and everyone
knows there is a job opening
■
●
Labour is free to move
Why important
○
Many (perhaps most) labour markets are not competitive
○
But competitive model is benchmark for comparisons
○
Provides starting point for more advanced models
○
Ideological importance
■
This is a important political point for some parties because they think only the
competitive labour market is possible to achieve equality
Supply of Labour
●
Supply of labour refers to the number of people who want to work in any given occupation.
Supply of labour depends on:
○
Wage rate in the occupation (total compensation)
■
Basic salary, benefits
■
When the wage is high, more people want to work in that occupation or
company so supply is high
○
Working conditions
■
●
When working conditions are good, supply is high
○
Amount of training required
○
Preferences of employees (location, etc)
Greater the wage rate, the more people will want to work in the occupation, other things equal
(living conditions, training, equality etc).
●
i.e. graphically, the labour supply curve is upward sloping
The Labour Supply Curve
●
As the wage rate increases, more employees want to work in the occupation.
●
Labour supply curve slope is upwards because when the wage is $10, we only have L1 for 10 but
when wage increases to $15, we have more workers who want to work. L2 is bigger than L1
Demand for Labour
●
Demand for labour refers to the number of workers an employer wants to hire in any
occupation. It depends on several factors including:
○
Wage rate
○
Technology
■
○
●
Automation (replace workers)
Output of the organization (“sales”)
An increase in the wage rate will reduce the amount of labour an employer wants to hire, other
things equal.
●
i.e. the demand for labour is downward sloping.
The Labour Demand Curve
●
As the wage rate increases, the quantity of labour demanded decreases.
●
Ex. when the wage is low, number of labourers hired is at a higher rate
The Equilibrium Wage Rate
●
The equilibrium wage rate is the wage at which the supply of labour equals the demand for
labour.
●
Pressure toward equilibrium wage in a competitive market.
●
No deficient demand unemployment at equilibrium wage but…
○
Frictional unemployment due to turnover
○
Structural unemployment due to mismatching
Equilibrium Wage in S&D model
●
Equilibrium occurs at the intersection of the supply and demand curves.
●
Oversupply of labour at W1 creates downward pressure on wage
○
●
Pressure for these markets to lower their wages to the equilibrium
What can unions do? Boost wages by reducing the supply of labor. However it must be willing to
accept a decrease in employment to achieve the wage hike. If unions want to increase wages,
they must accept a trade off
Factors that Impact Demand for Labour
●
Minimum Wage Policy
●
Non-Competitive Labour Markets
●
Deindustrialization
Minimum Wage Legislation in Ontario
●
Ontario Employment Standards Act specifies a general minimum wage, which is generally about
40-50% of average industrial wage.
●
Coverage of Ontario minimum wage
○
5% of Ontario employees work at minimum wage
○
3% of total hours worked
○
1.5% of total earnings
●
Minimum wage policy is a controversial issue in Canada.
●
Variety of approaches have taken by Ontario governments over the past couple of decades
Ontario Minimum Wage Policy 1995 onwards
Eight policy periods:
●
Over 25 years from 1995 to 2020 there have been 8 distinct policy periods:
1. Conservative Freeze 1995-2002:
○
Minimum wage was not increased during 8 years Conservatives in office in Ontario
under Premier Mike Harris
2. Annual Increases 2003-2007:
○
Ontario Liberal govt increased min wage from $6.85/hr in 2003 to $8.00/hr in 2007 (i.e.
17% over four years). Increase determined year by year.
3. Pre-determined Increases, 2007-2010:
○
In 2007 anti-poverty groups mounted a concerted campaign to increase the minimum
wage to $10/hr. They argued that at $8/hr an EE working full-time year round would only
earn $16,000/yr, below the “poverty line.” [50 wks @ 40 hrs/wk = 2000 hrs/yr].
○
In 2007 the Ontario govt announced the minimum wage would increase from $8.00 to
$10.25 by 2010, an increase of 28% over three years.
4. Liberal Freeze, 2011-2013:
○
The year after the Ontario government announced it’s three year program of minimum
wage increases the Canadian economy entered a recession caused by the Global
Financial Crisis.
○
Minimum wage frozen at $10.25 for 2011, 2012 and 2013
5. Catch-up and Keep-Up (2014-2017)
○
There was considerable dissatisfaction from both business and labour communities over
the pattern of substantial increases followed by freezes in the minimum wage.
○
July 2013 Ont govt established a Minimum Wage Advisory Panel.
○
Anti-poverty advocates campaigned to increase minimum wage to $14/hr. Held several
“days of action” to support campaign.
○
Ontario Chamber of Commerce advocated increasing the minimum wage annually by the
percentage increase in CPI to keep the real minimum wage constant (avoid freezes &
large increases).
○
Catch-up: In Feb 2014 the Liberal govt passed legislation to increase the minimum wage
from $10.25 to $11.00 (an increase of 7%) to catch-up for inflation during the three year
freeze.
○
Keep-up: From 2015 onwards, increases in min wage to were to be tied to increases in
Ontario CPI, as recommended by Advisory Panel.
○
Minimum wage increased to $11.25 in Oct 2015, $11.40 in Oct 2016., and to $11.60 in
Oct 2017 (in accord with increase in CPI).
○
However, the Liberal government abandoned the policy of tying the min wage to the CPI
after only three years.
6. Changing Workplaces Review (2017-2018)
○
May 2017, Ont Govt announced, that following the Report of the Changing Workplaces
Review, the minimum wage would increase to $15/hr in three stages.
○
Increase from $11.40 to $11.60 in Jan 2017, then to $14/hr in Jan 2018 (21% increase).
○
Also announced increase to $15/hr Jan 2019 (an increase of 7%).
7. Conservative Govt Freeze, 2018-2020
○
June 2018. Conservative government elected in Ontario, headed by Premier Doug Ford.
○
Announced the increase to $15/hr in Jan 2019 announced by the previous Liberal
government was cancelled .
○
Also announced the minimum wage would be frozen at $14/hr until Oct 2020 (almost 3
years).
8. Conservative Govt, Indexed to CPI, 2020 onwards
○
Oct 1, 2020 increased min wage to $14.25/hr
○
Current: $15.00
○
Oct.1, 2022 $15.50
The Real Minimum Wage
●
The real minimum wage is defined as the minimum wage adjusted for changes in the price level.
●
The real minimum wage can be calculated by adjusting the actual (i.e. nominal) minimum wage
to the price level in any chosen base year. I chose 2018.
●
E.g. the nominal minimum wage of $6.85/hr in 1995 can be converted to its value in 2018
dollars by multiplying $6.85 by the ratio of the Ontario CPI in 2018 to the Ontario CPI in 1995.
○
●
Real min wage = $6.85 (135.0/86.8) = $10.65.
Means a wage of $6.85 in 1995 could purchase same amount of physical goods & services as a
wage of $10.65 in 2018.
Rationale for Min Wage (why we need min wages)
●
Reduction of poverty and a more equitable distribution of income
○
i.e. intention is to redistribute income to relatively low wage minimum wage employees
from higher income employers and/or consumers
●
Strong public support for redistribution goals of minimum wage
○
Note that Conservative government did not increase minimum wage during 8 year term
of office, but it also did not abolish the minimum wage
Who Works at Minimum Wages
●
Almost half of minimum wage workers in Canada are teenagers (aged 15 to 19)
●
Two-thirds of minimum wage workers are under 25
●
Two-thirds of minimum wage workers live with their parents or another family member
●
60% of minimum wage workers are part-time
Distributional Impact of Minimum Wage: theory
Two reasons why minimum wage is likely to have small re-distributional effects:
1. Many people in poverty are not working and so will not benefit from an increase in the minimum
wage.
2. Many employees working at minimum wage are second or third earners in relatively high income
families. Result is that much of the benefit of a rise in minimum wage goes to families that are
not in the target group.
Green (2015)
●
Argues that minimum wages may reduce the extent and depth of poverty, even if it has a
minimal effect on the explicit “poverty rate”.
●
“At $10.25 per hour, for example, a single person working full time still remained below the
poverty line, so the last increase from $8.00 to $10.25 would be unlikely to have much effect on
the poverty rate (though it may have reduced the depth of poverty for some.” (Green, 2015, p.6)
Non-Competitive Labour Markets
●
Monopsony
●
Institutional Barriers to Supply
●
Unions and Labour Supply
Deindustrialization
●
Refers to shift of employment from manufacturing and other goods production to the service
sector.
○
70% of employees now in service sector
○
Happens in most industrialized or developed countries
●
Concern that unionization rates and wages may be lower and more unequal in the service sector
(“McJobs” is now an entry in the Oxford Dictionary).
Causes of deindustrialization
●
Rising living standards has led to an increase in the consumption of both goods and services,
however, consumers’ preferences for services have increased faster than their preferences for
goods.
●
Productivity growth is higher in goods industries than in service industries which are more
labour-intensive and are less easily replaced by technology.
●
Demand for labour in Canadian manufacturing has declined as production has shifted to
countries with lower labour costs. (globalization)
Deindustrialization: Implications
●
Many jobs in the goods sector are high-paying and unionized blue-collar jobs, whereas many of
the service-sector jobs are lower-paying and often non-union.
●
However, there are also high-paying union jobs in the service sector, eg. Teachers, pilots, doctors,
lawyers, accountants, etc.
●
Conclusion: effect of deindustrialization is mixed
●
In Canada, we have a similar rate of industrialization (30%) but our unionization rate is much
higher than U.S (9%)
Factors that Impact Supply for Labour
●
Women in the Workforce
○
●
More women working now
Part-time Work
○
Increase in part-time work
●
Non-Standard Work and Precarious Work
●
Aging of the Population & Mandatory Retirement
●
All factors contribute with the increase of labour supply
Women in the Workforce
●
Share of women in the labour force has risen from 34% in 1970 to about 48% in 2018.
●
Nearly half of the labour force is female
●
Due to rising labour force participation by women and a trend toward earlier retirement by men
(declining LFPR).
●
○
Male LFPR = 70% in 2018
○
Female LFPR = 61% in 2018
This rate means how many people of working age are working or looking for work
Women in LF: Implications
●
Implications of rising female LF share for LR:
○
○
Growing importance of pay & employment equity
■
We have to make sure women are being paid equally if they do the same job
■
In canada, a women only earns 76 cents and men earn $1
Sexual harassment, systemic discrimination
■
○
Promotions, other opportunities
Daycare, job-sharing, maternity leave, pensions
■
Employers need to think about policies to help employees balance their work life
Part-time work: definition
Statistics Canada definition of part-time work
●
●
A person who works less than 30 hours per week at their main job.
○
Formerly defined as normally working less than 30 hours at all jobs
○
In the 1950s, PT defined as working less than 35 hours
Magnitude of the change
○
Part-time employment rate has increased steadily from about 4% in the mid-1950s to
19% in 2013 or about one in five employees.
○
Generally about 75% of PT is “voluntary”
Part-time Work: Reasons for Rise
●
Rises of minimum wage over time
●
Child care is increasingly expensive
●
Rise in female labour fore participation means an increase in supply of employees wanting part
time work
●
Aging work force may result in more older workers working as par-time
●
Deindustrialization: the rise of service sector increase the demand of part time work
Part-time work: Implications
●
Part-time work is usually compensated at lower levels even though their productivity is generally
equal to or higher than that of full-timers.
●
Lower compensation of part-timers is seen as a threat to employment and compensation of
full-timers.
○
●
Full timers feel threatened by part-timers
Part-time workers are more difficult to organize.
○
Hard to unionize
Part-time work: legislation
●
Equal Pay for Part-time Employees
●
In 2017 the Ontario Liberal Govt passed legislation Bill 148 (Fair Workplaces, Better Jobs Act)
requiring that part-time employees be paid equal wage to full-time workers if they were doing
substantially the same work
●
Nov 2018, Ontario Conservative govt passed Bill 47 (Making Ontario Open for Business Act)
which repealed Equal Pay for Part-time employees effective Jan 2019.
Non-Standard Work
●
Non-standard work includes part-time and contingent work.
●
Contingent work includes casual, term, contract, temporary and seasonal jobs.
○
●
Provide flexibility in responding to fluctuations in demand.
Non-standard work comprises about one-third of the LF
Precarious Employment
●
Prof on Arif Jetha, UofT School of Public Health, published an article on Sept 7, 2018 on the
precarious employment “ For millennials, employment is a public health challenge”
●
The following slides on Precarious Employment are excerpts from his article:
●
Note: “Millennials” are the generation born roughly from 1980 to 2000 (although dates vary).
Also known as Generation Y or Children of the Baby Boomers. Currently aged 18 to 38 years old.
●
Research among Canadians shows employment to be a critical social determinant of health,
partly because those who earn higher wages have more access to safe housing, nutritious foods,
social services and medical care.
●
Millennials now make up the largest share of the Canadian workforce and many are facing
precarious working conditions.”
●
As a society, we have previously assumed that if young Canadians invest in formal training and
“pay their dues” in poor quality jobs early in their careers, they will work their way into better
quality employment. A recent report from the Canadian Centre for Policy Alternatives (CCPA)
suggests a different reality.
●
The study, based on a national survey of 1,000 professionals, found that 22 per cent are working
in precarious situations characterized by contract work, part-time hours, unpredictable incomes
and a lack of paid sick days.”
●
“The hurdles faced by millennials inside and outside of the workplace can have a “scarring
effect” and can contribute to adverse work outcomes (such as unemployment, missed work
days, loss of confidence) that extend across adulthood.
●
Prolonged employment in precarious jobs could also have a substantial impact on health. For
instance, studies indicate that millennials are at the highest risk for mental health issues, an
outcome that can be exacerbated by those with lower incomes.”
Aging of the Population
●
Median age of the working population rising.
●
Baby-boomers born between 1947-1966
○
●
Boomers reaching “normal” retirement age (65) between 2012 and 2031.
Implications for of aging LF for LR:
○
What do older workers want?
■
Concern with pensions, health care, etc
○
Promotion opportunities limited
○
Mandatory retirement issue increasingly important
○
Labour shortage in future?
■
Yes
Mandatory retirement & HRC
●
Mandatory retirement (MR) refers to an employer policy that requires employees to retire at a
fixed age, typically 65. There has never been a law forcing people to retire at 65.
●
The Ontario Human Rights Code (HRC) prohibits discrimination on the basis of age, which would
make MR illegal since it is obviously age discrimination.
●
But, up until Dec 2006, the age discrimination provision in Ontario HRC was subject to a “cap”:
○
“age” was defined as meaning an employee between 18 and 64.
○
cap allowed MR at 65 to continue until 2006
MR & Canadian Charter of Rights and Freedoms
●
Age discrimination also prohibited under the Canadian Charter of Rights and Freedoms (the
constitution).
○
but the Charter contains a “reasonableness test”
○
i.e. discrimination is allowed if it can be shown to be “reasonable in a free and
democratic society”
●
The Supreme Court of Canada, in 1990 ruled that the “cap” on the age discrimination provision
in the Ontario HRC was discriminatory, but it was “reasonable” discrimination
●
Supreme Court ruling allowed MR to continue in Canada.
○
●
-A political decision whether to prohibit MR in each province
The rationale for Supreme Court’s decision was that abolition of MR might have wide-ranging
impacts on the IR/HR system (such as jobs for new LF entrants, costs of public pensions,
productivity, etc).
Changes to Ontario MR legislation
●
The Ontario Human Rights Commission in 2001 recommended that the age cap in the HRC be
removed, which would effectively end MR in Ontario (A Time for Action: Advancing Human
Rights for Older Ontarians, Ontario HRC, 2001).
●
In April 2003 the Ontario Conservative govt announced they planned to scrap MR if re-elected.
●
In Dec 2005 the Ontario Liberal govt passed legislation abolishing MR effective Dec 2006.
●
Exemption for bona fide occupational requirement
○
Ex. dangerous for people older than 65 to operate a plane
Labour Market Policy Issues
●
Income and Income Distribution
●
The Rise and Fall and Rise of Keynesian Economics
●
Government Fiscal Policy During the COVID Pandemic 2020
Income Concepts
●
Employment income (aka earnings)
○
●
●
●
Includes wages, salaries, self-employment income
Market income
○
aka factor income or income before transfers
○
Employment income plus investment income
Total income
○
Market income plus transfer payments
○
Transfer payments include welfare, EI, OAS, etc.
After-tax income
○
Total income minus income tax
Frequency Distribution of Income
●
Frequency Distribution of income is a graph showing income on horizontal axis and the number
(or percentage) of families on the vertical axis
●
Income distribution is not a normal distribution.
●
Income is highly skewed, even though most human attributes (height, IQ, etc) are normally
distributed
●
Median income below mean income
○
For a normal distribution, median = mean).
AN IMPRESSION OF INEQUALITY OF INCOME (JAN PEN)
●
To give a sense of the inequality in the distribution of income, Dutch economist Jan Pen used a
metaphor in which income is proportional to height.
○
Assumed a person with average income has average height.
●
Imagine a parade in which all people pass by in one hour
●
Parade begins with a few people with negative income
○
●
Gnomes the size of a matchstick
○
●
E.g. Businesses with losses, students borrowing to study,
E.g. persons working PT
For the first six minutes (incomes up to $10,000) marchers are only about 30 cm (i.e. one foot)
tall
●
After half an hour (median family income of $55,000) people are about 168cm (i.e. 5’6”) still
below average height (since median is less than mean)
●
○
E.g. office workers, labourers
○
most people below average income.
last few minutes people are 4 to 5 meters (16 to 18 feet) tall
○
●
E.g. doctors, lawyers,
last few seconds they are GIANTS with heads in the clouds
○
Height measured in kilometers
○
Ex. eco
Quintile, Decile and Vingtile Shares
●
Quintile means ordering the population by income (for example) and dividing it into five groups
of equal size
●
Decile means ordering the population by income and dividing it into ten groups of equal size
●
Vingtile means ordering the population by income and dividing it into twenty groups of equal
size
Example: Quintile Shares
Measures of Inequality
●
The Gini coefficient is the most common measure of inequality used in the income distribution
literature
●
Gini has a more intuitive interpretation than standard statistical measures such as variance or
coefficient of variation
Gini 45 Countries
●
Text (IR in Can, 4th edition p. 76, Fig 3.3) gives Gini Coeffieients for 45 countries (2016)
●
Inequality in Canada is about average for the group.
●
United States has substantially more inequality than average
●
Scandinavian countries have substantially less inequality than average
Change in Gini 1976-2011
●
See Banting and Myles (2015) “Framing the New Inequality: The Politics of Income Redistribution
in Canada” in Income Inequality: The Canadian Story
○
“Inequality in market incomes from earnings and investments began rising in the early
1980s, surged ahead over the entire 1990s and then levelled off in the 2000s. The GINI
coefficient rose from .37 to .44, a huge change in a measure that is difficult to move”
(p.3)
Changing Impact of Transfers Tax
●
According to Banting and Myles (2015, p.4)
●
“Strikingly, transfers and taxes completely offset the rise in the Gini until roughly 1994.
●
In the mid-1990s, aided and abetted by cuts to unemployment insurance and social assistance,
the tax and transfer system… could no longer keep up with rising inequality. The result was a
sharp rise in inequality in post-tax and post-transfer income … and the GINI rose from .29 to
.32.”
Contending “Frames”
●
Banting and Myles identify three “contending frames” for the politics of redistribution, focusing
on different points in the income distribution:
●
Poverty
○
concern about poverty has been the traditional frame for viewing the redistribution
debate
●
The 99/1 Frame
○
●
The 2011 “Occupy” movement focused on the top 1% of the distribution
The Middle-Class Frame
○
In recent elections political parties have emphasized policies to benefit the middle class.
Chapter 2: Labour History
PREUNIONIZATION
MASTER-SERVANT RELATIONSHIP
●
Prior to unionization, Master-servant relationship: employment relationship in which employees
have few rights and were required to follow these rules
●
common law: the legal regime for non-union employment. dictated that employees must
perform work, and employers were responsible for paying wages.
●
Workers were prohibited from quitting, bargaining collectively, or forming unions, as
management had control over most aspects of the employment relationship.
●
Laws and courts did little to safeguard employees and often strengthened the employer's power.
●
The Master and Servant Act deemed workers who refused to report to work or disobeyed lawful
orders as guilty of a criminal offense, with penalties for collective bargaining attempts.
THE MOVEMENT TO UNIONIZATION
THE EARLY YEARS (PRE-1900)
NEW MODEL UNIONISM
●
new model unionism: the movement to trade (or craft) unions
○
focused on negotiating with employers to resolve workplace issues rather than resorting
to strikes.
●
These unions often controlled access to the trade through Apprenticeship: a process in which
trainees learn a trade under the supervision of a senior tradesperson
●
By influencing the labor supply, these unions aimed to minimize wage competition among their
members.
●
trade union: unions that organize all workers of a trade regard less of their industry or workplace
THE NINE-HOUR MOVEMENT AND TRADE UNION ACT OF 1872
●
began when around 1,500 workers in Hamilton demanded a shorter workday, defying existing
laws. Toronto printers also went on strike that year against the founder of the Globe newspaper.
Although these movements did not lead to substantial gains, they influenced Prime Minister Sir
John A. Macdonald to introduce the Trade Union Act, which allowed employees to join unions.
Additionally, an amendment to the Criminal Law Amendment Act made it legal to join a union,
but striking still carried potential jail penalties. These legislative changes marked the birth of a
formalized Canadian labor movement.
AMERICAN FEDERATION OF LABOR AND THE TRADES AND LABOUR CONGRESS OF CANADA
Cigar maker Samuel Gompers founded the AFL as a federation of trade unions built upon three key
principles.
EXCLUSIVE JURISDICTION
●
when a single union represents all workers of a trade or occupational grouping
●
Craft-based unions restricted membership to wage earners only.
●
Each union was responsible for representing and advocating for a single occupation or trade.
●
The principle of "one union per craft; one craft per union" meant that there would be exclusive
representation for specific professions.
BUSINESS UNIONISM (OR PURE-AND-SIMPLE UNIONISM)
●
unionism that focuses on improving wages and the working conditions of its members
●
socialist unionism: unionism that challenges capitalism and seeks equity for union and non-union
members
●
Gompers prioritized the economic well-being of union members over political reforms.
●
Economic security was seen as the key to protecting workers' rights.
●
The phrase "more, more, and more" symbolized Gompers' emphasis on securing greater
economic gains for workers.
●
North American unionism became known as "bread and butter" unionism or business unionism
due to its focus on ensuring workers had essential necessities.
POLITICAL NONPARTISANSHIP
●
a belief that unions should not align with any political party
●
Labor should define its own priorities and seek endorsement from political parties.
●
"Rewarding friends" and "punishing enemies" meant supporting parties aligned with labor's
interests.
●
In Canada, the Trades and Labour Congress (TLC) was formed, composed of Canadian affiliates of
the American Federation of Labor (AFL) as well as other groups like the Knights of Labor. Prior to
the AFL, the Canadian Labour Union (CLU) existed, advocating for broader issues beyond the
AFL's focus. The CLU aimed to improve working conditions, limit child labor, and promote
education. Daniel O'Donoghue played a significant role in the formation of the CLU and later the
TLC. However, O'Donoghue's involvement in politics conflicted with the AFL's core values,
contributing to the perception of Canadian labor as more socialist compared to its American
counterpart.
THE KNIGHTS OF LABOR
●
Secret sociated
●
3 factors that differentiate this from other labour organizations
1.
It believed in the creation of a single large union for skilled and unskilled workers; thus, it did
not follow the doctrine of"one union per craft; one craft per union."
2. It was opposed to strikes. The Knights' leadership felt that strikes led to hardship for workers.
However, while the leadership may have opposed strike action, the members did not. Members
of the Knights were actively involved in many large strikes (Kealey & Palmer, 1995).
3. The Knights sought to establish cooperative businesses, which would be owned and operated by
members of the union rather than by employers per se. This was in direct contrast to the idea of
"bread and butter" or business unionism espoused by Gompers.
1900-1920: THE YEARS OF STRUGGLE
●
1900 and 1914 were a period of rapid economic development in Canada.
●
Despite economic growth, not all segments of society benefited equally, and the working class
faced significant hardships.
●
During this period in Canada (1901-1913), there were fourteen major strikes, eleven of which
required military intervention.
●
The First World War began during this time, further shaping the labor movement.
●
The early 20th century laid the foundation for the Canadian labor movement and created a
division between skilled and unskilled workers that persisted for about fifty years.
●
Important events during this period include the Berlin Convention, the introduction of the
Industrial Disputes Investigation Act (IDIA), the Winnipeg General Strike, and the emergence of
the One Big Union.
Berlin Convention 1902
●
AFL (American Federation of Labor) influenced the Canadian labour movement in 1902.
●
The Trades and Labor Congress (TLC) convention in 1902 caused a significant divide in the
Canadian labour movement that lasted for fifty years.
●
As a result of the convention, the TLC became exclusively composed of unions affiliated with the
AFL.
●
Unions that didn't align with Gompers's program's three core principles (exclusive jurisdiction,
business unionism, and political nonpartisanship) were expelled from the TLC.
●
The expelled unions, mostly industrial-based unions representing less-skilled workers (including
the Knights of Labor), formed the National Trades and Labour Congress (NTLC) in 1902.
●
The NTLC later transformed into the Canadian Federation of Labour (CFL) in 1908.
●
In 1927, the CFL became the All-Canadian Congress of Labour (CCL).
Industrial Disputes Investigation Act (IDIA 1907)
●
Conciliation services were introduced by the federal Department of Labour in 1900 through the
Conciliation Act.
●
In 1907, as deputy labour minister, William Lyon Mackenzie King formulated the Industrial
Disputes Investigation Act (IDIA), which became a significant part of Canadian labour law.
●
The IDIA reflected a growing trend in Canadian legislation that emphasized third-party
intervention before a strike.
●
Under the Act, workers and employers in specific industries (such as resources, utilities, and
transportation) were required to bring their disputes before a three-person conciliation board
before engaging in a strike or lockout.
●
The panel would hear evidence from both parties and issue a report.
●
A mandatory "cooling-off" period was enforced once the board completed its report, during
which strikes or lockouts were prohibited.
the Winnipeg General Strike
●
The context of the Winnipeg General Strike in 1919 involved the building trades and
metalworkers being on strike.
●
Both groups aimed to have their unions recognized and improve working conditions and wages.
●
The Winnipeg Trades and Labour Council (WTLC) was approached by the striking workers to
address their concerns and WTLC conducted a vote among all unions for a general strike
●
The strike garnered significant support, with over 11,000 votes in favor and only 500 against.
●
Various occupational groups showed support for the strike, including 149 police staff, all 278
waiters and cooks, and 250 postal workers (with minimal opposition).
●
While the vignette implies that the strikers did not achieve their goals, the strike had positive
outcomes concerning the government's response.
●
In the 1920 Manitoba election, labor candidates won eleven seats, with four of them being strike
leaders.
ONE BIG UNION AND OTHER SOCIALIST MOVEMENTS
●
The OBU (One Big Union) is closely associated with the Winnipeg General Strike.
●
OBU was a radical labor organization with a focus on social unionism.
●
key demands was the implementation of a six-hour workday to address unemployment.
●
The origins of OBU in Canada can be traced back to the Western Labour Conference in Calgary in
March 1919. During the conference, a referendum was held to separate from the TLC and
establish the more militant OBU.
●
OBU differed from the TLC in several ways: it aimed to organize all workers, aligned itself with
the revolutions in Germany and Russia, and had strong ties to the Socialist Party of Canada (SPC).
●
OBU had an estimated membership of 50,000 in 1919, which declined to about 1,800 over the
following years.
●
OBU's lineage can be traced back to two other labor groups: the Knights of Labor and the
Industrial Workers of the World (IWW).
●
OBU sought to revive the mass organization approach of the Knights of Labor, which
foreshadowed the industrial unionism concept of One Big Union.
●
The IWW, also known as the Wobblies, were socialist and emphasized the collective power of
workers to impact the economy through unionization.
●
The IWW had a presence in Canada primarily during the 1910s, with significant representation
among railway construction workers.
●
By the end of 1918, the IWW membership in Canada had significantly declined.
●
However, the IWW still exists today and continues to advocate for one big union and
industry-wide unionization efforts.
THE 1930s AND 1940s: DECLINE AND RESURRECTION
●
Great Depression: a period of significant economic downturn resulting from the stock market
crash of 1929
○
●
Resulted in high unemployment rates and increased reliance on social assistance.
Many changes occurred which were influenced by the Wagner Act in the United States and the
separation of the Congress of Industrial Organizations from the AFL.
THE WAGNER ACT
In 1935, Senator Robert Wagner introduced the National Labor Relations Act (known as the Wagner Act)
in the United States. This act established fundamental four elements that continue to shape labor
relations laws in both the United States and Canada.
1. It created an independent agency (the National Labor Relations Board; NLRB) to enforce the
right of employees to bargain collectively.
2.
It required that employers bargain collectively with certified unions (e.g., when the majority of
workers in an appropriate bargaining unit sought collective representation).
3. It defined unfair labour practices on the part of employers (e.g., bargaining directly with
employees, disciplining employees for union activity).
4. It gave the NLRB the authority to order remedies for employer violations of the NLRA, including
back pay and reinstatement of employees.
5. It adhered to the doctrine of exclusivity. Only one union, the one that the majority of workers
selected, would represent the entire bargaining unit.
6. Perhaps most important to both workers and employers of the day, it encouraged collective
bargaining.
COMMITTEE OF INDUSTRIAL ORGANIZATION, 1935
●
Early unions focused on organizing workers within specific crafts or trades.
●
The economy underwent a transition in the 1930s, leading to an increase in industrial
workplaces and the emergence of industrial unions.
●
industrial unions: unions that organize all workers of an industry/ workplace regardless of trade
●
The traditional approach of dividing employees into craft unions was questioned at the 1935 AFL
meeting.
●
John Lewis, leader of the United Mine Workers, advocated for the creation of an
industrial-focused organization within the AFL, leading to the formation of the Committee for
Industrial Organization (CIO).
●
The CIO aimed to organize non-union workers in industrial settings and grew into a social
movement, with workers holding sit-ins to improve their workplaces.
●
In 1937, the CIO was expelled from the AFL and became an independent congress called the
Congress of Industrial Organizations (CIO).
CANADIAN IMPLICATIONS
●
In 1937, Nova Scotia became the first Canadian jurisdiction to enact a law resembling the
Wagner Act, which mandated collective bargaining between employers and recognized unions.
●
In 1939, the Trades and Labor Congress (TLC) expelled unions affiliated with the Congress of
Industrial Organizations (CIO). These CIO affiliates formed the Canadian Congress of Labour (CCL)
along with the All-Canadian Congress of Labour.
●
The outbreak of the Second World War and the implementation of the Wartime Labour Relation
Regulation, also known as "P.C. 1003," were highly impactful events during this period.
P.C. 1003, 1944
●
During World War II, the Canadian federal government gained jurisdiction over labor relations
due to wartime emergency powers.
●
The existing conciliation procedures (Industrial Disputes Investigation Act) were inadequate for
addressing labor issues during the war.
●
In February 1944, the government of Mackenzie King introduced the Wartime Labour Relation
Regulation (P.C. 1003), which mirrored key elements of the Wagner Act.
●
P.C. 1003 included additional provisions not found in the Wagner Act, such as requirements for
handling workplace disputes during the collective agreement term and pre-strike conciliation
procedures.
THE RAND FORMULA, 1945
●
In the 1940s, there was a significant increase in the number of unionized workers due to the rise
of industrial unions, formal union certification procedures, and compulsory collective bargaining
among certified units.
●
Financial security for unions was a concern, and a landmark decision by Justice Ivan Rand
addressed this issue during a Ford strike in Windsor, Ontario.
●
Justice Rand's decision, known as the Rand Formula, stated that all union dues would be
deducted from workers' pay, regardless of their membership status.
●
Workers in a certified bargaining unit were not obligated to join the union but were still required
to pay union dues.
THE 1950s AND 1960s: RECONCILIATION AND EXPANSION INTO THE PUBLIC SECTOR
●
In 1940s, there was a significant increase in industrial unions and the establishment of labor
rights. However, it also led to a division within the labor movement between skilled and
unskilled workers.
●
1950s and 1960s witnessed efforts to reconcile these divisions, the formation of a labor
organization supported by unions, and the introduction of important legislation allowing public
sector employees to unionize.
CANADIAN LABOUR CONGRESS (CLC), 1956
●
Skilled and unskilled workers were reunited after a fifty-year separation.
●
The AFL-CIO was founded in the United States, leading to the reunion of Canadian labor groups.
●
The Canadian Labour Congress (CLC) was formed in April 1956, uniting the industrial-based CCL
and the trade-based TLC.
●
CLC is the largest federation of Canadian labor, representing 3.3 million Canadians.
●
The Founding Convention in 1956 called for various initiatives, including a national healthcare
scheme, a bill of rights, improvements to unemployment insurance, elimination of discrimination
against women, equal pay, a national pension scheme, and increases to minimum wages.
●
A political education department was established to aid in the formation of a new political party
that encompassed unions, farmers' groups, cooperatives, and progressive organizations.
●
In 1961, the NDP was founded with labor support
●
Unions have special status within the NDP but do not dominate the party, adhering to the
principle of not having more than a 25 percent representation on party structures.
PUBLIC SERVICE STAFF RELATIONS ACT (PSSRA), 1967
●
In 1961, the introduction of the Civil Service Act allowed public sector employees to appeal
certain employment decisions.
●
On March 31, 1967, the Public Service Staff Relations Act (PSSRA) was passed, granting federal
government employees the right to engage in collective bargaining.
●
The PSSRA was a significant milestone in Canadian labor relations for two reasons:
○
It led to the public sector becoming a significant portion of Canada's unionized
workforce.
○
It differed from the United States, where collective bargaining for civil servants is largely
prohibited.
THE 1970s AND 1980s: CHANGING RELATIONSHIPS WITH GOVERNMENTS AND THE UNITED STATES
●
1970s and 1980s were challenging for the Canadian economy, marked by fluctuating oil prices,
high inflation, and increased free trade.
●
In the United States, both legislation and employers' actions aimed to weaken unions and reduce
their influence in the workforce.
●
In Canada, unions started to assert their independence from the American labor movement.
Canadian auto workers separated from the United Auto Workers (UAW) to establish their own
autonomous Canadian union.
WAGE AND PRICE CONTROLS AND LEGISLATION
●
In the 1970s and 1980s, legislation was passed to limit wage increases in response to high
inflation rates.
●
In 1975, Prime Minister Pierre Trudeau introduced legislation that restricted wage increases
through the Anti-Inflation Board (AIB).
●
The AIB monitored wage settlements in the private and public sectors from 1975 to 1978, but its
effectiveness was questioned.
●
In the early 1980s, there was another surge in inflation, leading to the implementation of the "6
and 5" program in 1982.
●
The "6 and 5" program froze public sector wage increases at 6 percent in the first year and 5
percent in the second year.
●
The practice of freezing or restricting wage increases continued into the new millennium.
FREE TRADE AGREEMENTS
●
In the 1980s, Canada and the United States signed the first major free trade agreement, which
came into effect in 1989.
●
In the 1990s, Mexico joined Canada and the United States in signing the North American Free
Trade Agreement (NAFTA).
●
Supporters of the agreements believed that reducing trade barriers would result in lower tariffs
and improved productivity and living standards for Canadians.
●
However, labor groups were concerned about the potential negative effects of the agreements,
such as reduced wages and job security.
●
Canada's largest private-sector trade union, "it's hard to find any concrete economic evidence
whatsoever that this historic deal actually helped Canada" given that:
○
the relative importance of Canada's exports to the United States has not changed (stable
at 19 percent of Canada's GDP);
○
most of Canada's exports to the United States today are unprocessed primary and
resource products rather than manufactured goods (such as automobiles, electronics,
and machinery);
○
Canada now only represents 14 percent of imports into the United States, a drop of 5
percent since NAFTA;
○
Canadian productivity relative to the United States has dropped by almost 20 percent
since 1980; and
○
the median real income of families has not changed.,,_
CANADIAN AUTO WORKERS UNION (CAW)
●
In the 1980s, the Canadian labor movement became less dependent on the United States (US).
●
The US labor movement experienced concession bargaining, less labor-friendly governments,
and employer actions during this period.
●
The Canadian division of the United Auto Workers (UAW) sought increased autonomy and
independent goals from its American parent.
●
When these requests were denied, the Canadian UAW established itself as an independent
Canadian union in 1985.
●
The union was later renamed the Canadian Auto Workers (CAW) and has since merged with the
Communications, Energy and Paperworkers Union of Canada (CEP) to form Unifor, Canada's
largest private sector union.
THE 1990s: INCREASED RESISTANCE
●
NAFTA, the North American Free Trade Agreement, was expanded to include Mexico during this
decade.
●
The Canadian economy underwent restructuring with a greater emphasis on global markets.
●
significant government restructuring
●
Legislation was increasingly used to replace collective bargaining in the public sector.
●
Collective protests were a notable feature of this period.
ECONOMIC RESTRUCTURING, GLOBAL MARKETS, AND JOB LOSS
●
Inflation was four times higher than in 1970, government deficits were high, and unemployment
rates were above 10%.
●
Canadian companies faced challenges due to the fallout from high inflation, including a drop in
speculative investments and servicing large debts.
●
Businesses experienced defaults, restructurings, and downsizings, leading to prolonged
unemployment and frozen or reduced wages and salaries.
●
Job losses and competitive pressures affected union strongholds like construction,
manufacturing, and natural resources sectors.
●
The construction, manufacturing, and natural resources sectors saw employment declines of
over 10%, with limited recovery.
●
The fishing industry, particularly in BC and Newfoundland, experienced significant job losses due
to foreign competition and removal of trade barriers.
●
Government aid was required to support affected workers and facilitate their transition to new
industries.
GOVERNMENT RESTRUCTURING
●
The public sector in Canada, which is a stronghold for unions, underwent significant
restructuring in the 1990s.
●
Debt and deficit reduction efforts led to changes in the public sector, resulting in a loss of about
6% of Canadian public sector jobs between 1992 and 1998, with a significant drop of 18% in
federal government jobs.
●
The decrease in public sector jobs was attributed to factors such as increased contracting out,
privatization, and the use of contractors and consultants instead of full-time employees.
●
Privatization: the transfer or contracting out of services to the private sector
●
The trend of employing contractors and consultants is not limited to the public sector.
●
According to a Bank of Canada report, approximately 10,000 of the nearly 40,000 permanent
jobs lost in the federal public sector between 1995 and 1998 were due to privatization or
devolution.
●
Numerous federal Crown corporations, including Canadair Inc., Canadian National Railways
(CNR), and Petro-Canada, were privatized during this period, amounting to nearly $12 billion in
value.
●
Crown corporations: corporations owned by the government
LEGISLATION REPLACING COLLECTIVE BARGAINING
●
In the 1990s, public sector unions in Canada faced restrictions on their ability to negotiate on
behalf of their members.
●
Back-to-work legislation was frequently used during this period, forcing striking workers to
return to work.
●
Back-to-work legislation legislation requiring that strike action cease and employees return to
work
●
Swimmer and Bartkiw (2003) found that in 1999 alone, the provinces of Saskatchewan, Quebec,
and Newfoundland legislated striking nurses back to work in the broader public sector.
●
Some decisions related to wages and benefits, which are typically negotiated between the union
and the employer, were included in back-to-work legislation during the 1990s.
INCREASED COLLECTIVE PROTEST
●
Public sector restructuring in Ontario during the 1990s generated resistance from labor.
●
The Bob Rae government implemented the Social Contract, requiring public sector employees to
take twelve unpaid days off per year, known as "Rae Days."
●
When the Conservative government led by Mike Harris came into power in 1995, severe budget
cuts were implemented.
●
In response to the budget cuts, labor leaders called for a massive public strike and a public
strike/rally at the Ontario legislature.
●
The "Days of Action" took place in October 1996 and lasted for five days, with an estimated
quarter of a million people participating in the protest on October 26, 1996.
●
The protest is considered one of the largest strikes since the Winnipeg General Strike.
THE 2000s AND BEYOND: MAJOR ECONOMIC RESTRUCTURING CONTINUES
In the new millennium, trends from the 1990s continue, including: a move toward a "gig" economy, and
increased use of legislation to replace collective bargaining in the public sector, as well as increased
collective protests.
EXTENSIVE ECONOMIC RESTRUCTURING
●
●
The new millennium faced economic challenges with two recessions:
○
one in 2001 due to a decline in the technology sector,
○
another in 2008 caused by a crisis in the real estate and financial sectors.
Manufacturing, traditionally a union stronghold, suffered severe job losses and faced
competitive pressures during this period.
●
One CLC report noted that in the four years between August 2002 and October 2006:
○
more than 250,000 jobs (over 10 percent of positions) had been lost due to layoffs, plant
closures, and nonreplacement of retirees;
○
job losses in unionized firms were almost double thoset of non-union firms (16.4 percent
versus 8.7 percent); and
○
the rate of job loss differed across industries, with one-third of jobs being lost in the
textiles, clothing, and leather-products manufacturing groups.
●
Between 2004 and 2008, over 320,000 jobs (14% of all jobs) were lost in the manufacturing
sector, with the textile and clothes-manufacturing sector being severely affected.
●
Union jobs in the manufacturing sector declined from 32.2% in 2004 to 26.4% in 2008.
●
In the 12 months between May 2012 and May 2013, more than 100,000 manufacturing jobs
were lost in Canada.
●
General Motors announced plant closures, including the one in Oshawa, Ontario, resulting in job
losses for over 3,000 workers.
●
The forestry industry experienced significant job losses, with 40,000 people losing their jobs over
a five-year period due to factors such as economic trends, competition, and decreased demand.
●
Between 1997 and 2016, the total job loss in the forestry sector was 42%.
●
Canada has engaged in major trade agreements such as CETA, CKFTA, and the Canada-United
States-Mexico Agreement, which have further impacted the labor movement and the Canadian
economy through global trade.
CONTINUED GOVERNMENT RESTRUCTURING
●
In the new millennium, governments implemented measures to cut public-sector labor costs,
including wage freezes, spending cuts, and layoffs.
●
In 2004, four provinces announced plans for wage freezes, spending cuts, and/or layoffs in the
public sector.
●
In 2013-14, several provinces, including Alberta, Ontario, and Quebec, engaged in debates about
the necessity of public sector wage freezes.
●
The federal government announced in its 2012 budget that it would be cutting 19,000 jobs, with
most of the cuts scheduled for 2014-15.
●
By April 2014, the federal government had already cut 20,000 jobs since 2010 and anticipated an
additional 8,900 cuts in the following three years.
●
Similar job cuts and cost-cutting measures were implemented at the provincial level, such as in
Newfoundland and Labrador and Manitoba.
●
In the 2014 Ontario provincial election, the PC Party proposed eliminating 100,000 public sector
jobs, and since forming the government in 2018, they have introduced a hiring freeze and
voluntary exit plans for employees.
●
These trends reflect a decline in public sector employment, which has traditionally been a
stronghold for unions.
NONSTANDARD WORK AND THE "GIG" ECONOMY
●
Nonstandard work can differ from typical full-time in any, or all, of the following ways: (1) term
of employment (e.g., nonpermanent), (2) location (e.g., telecommuting), (3) work schedule and
hours of work, and (4) pay
●
new millennium has also seen the emergence of the "gig economy," where workers often have
multiple employers and there is debate regarding their employment status (employee or
self-employed).
●
The gig economy challenges traditional employment models and raises questions about worker
rights and benefits.
●
"gig" economy: a special form of non-standard work where there are two forms of work:
crowdwork and app-based
INCREASED COLLECTIVE PROTESTS
●
Large-scale protests against public sector cuts have continued since the 1990s, with global
demonstrations taking place.
●
In 2014, around 1 million public sector workers in Britain went on strike to protest against pay
freezes, pension changes, and declining living standards (Taylor & Mason, 2014).
●
In 2011, tens of thousands of public sector workers in Wisconsin protested a budget bill that
limited union bargaining to wages only, excluding benefits and pensions (Bruce, 2011).
●
In Canada, a notable example of collective protest occurred in 2012 when over 175,000 students
in Quebec went on strike for several months and held 170 protests against a proposed 75
percent tuition fee increase. The strike received significant media attention, and labor groups
across Canada provided support (The Canadian Press, 2012).
IMPLICATIONS FOR THE FUTURE OF LABOUR
LARGER UNIONS
●
A trend towards larger unions and protest events is emerging in Canada.
●
The merger of the Canadian Auto Workers (CAW) and the Communications, Energy and
Paperworkers (CEP) resulted in the creation of Unifor, the largest public sector union in Canada
(Unifor, 2019b).
●
Unifor's website indicates its advocacy for all workers, including those who are unemployed,
signaling a shift away from traditional bread-and-butter unionism.
SOCIAL UNIONISM
●
Labour's support of the Quebec student strike, Unifor's positioning as an advocate for both
employed and unemployed individuals, and the social orientation of Canadian labor compared
to American labor suggest a trend towards social unionism in Canada.
●
Unifor's formation and messaging highlight a broader focus on collective bargaining for better
wages, pensions, and benefits, as well as workplace rights, health and safety, democracy at work,
and organizing.
●
Unifor also expresses a commitment to broader social issues such as freedom, civil liberties,
democratic trade unionism, environmental sustainability, resistance against corporate
globalization, global union solidarity, and working towards ending war and contributing to world
peace.
GLOBAL VERSUS NATIONAL
●
Labor in Canada experienced a shift in the 1980s towards an independent and national
movement, distinct from American labor. However, in recent years, there has been a trend
towards a more globalized labor platform.
Chapter 4: THE LEGAL ENVIRONMENT
WAGNER ACT HISTORY
●
Prior to the passage of the Wagner Act in the United States, unions faced violent struggles for
recognition between management and labor.
●
Unions in Canada encountered hostile employers
●
The 1907 Industrial Dispute Investigations Act in Canada failed to provide a mechanism for union
recognition.
●
Factors contributing to the decline of organized craft labor in both countries included scientific
management, mass production, company unions, and a hostile legal environment.
●
scientific management: the application of engineering principles to define specific tasks in the
production process, thereby removing the autonomy of skilled craft workers (associated with
Frederick Taylor)
●
The Great Depression of the 1930s led to a new wave of unionism as workers distrusted
companies and sought protection.
●
Industrial unions emerged, organizing all workers in an industry regardless of skill or
occupational status.
●
In the United States, President Franklin D. Roosevelt's election in 1932 advanced the cause of
industrial unionism.
●
The 1935 National Labor Relations Act (Wagner Act) protected the right to organize unions,
engage in collective bargaining, and strike under federal law.
●
The Wagner Act legitimized industrial unionization, resulting in an increase in union density from
12.9% in 1930 to 22.5% in 1940.
THE SNIDER CASE
●
1923 case stemming from a labour dispute between the commission and its employees.
●
The dispute triggered the appointment of a conciliation board under the Industrial Dispute
Investigations Act.
●
Toronto Electric Power argued that the federal statute did not apply to a labour dispute in
Toronto based on the British North America Act (BNA Act).
●
The BNA Act assigned civil and property matters to the provinces, raising the question of
whether labour relations legislation was a provincial or federal responsibility.
●
The case reached the British Privy Council, Canada's highest court at the time.
●
The Privy Council ruled that the federal government exceeded its jurisdiction by applying the
1907 IDIA to a province and emphasized provincial responsibility over civil matters.
●
This decision established the legal authority for Canada's system of shared jurisdiction, where
the federal government has control over interprovincial industries while provinces govern other
areas of commerce.
●
However, not all provinces had labour legislation in 1925, leading to the subsequent
development of separate labour policies by each province and the federal government over the
next two decades.
●
Snider case: a landmark court case in 1925 that determined that labour matters fell under the
purview of the provinces under the British North America Act
CANADA'S P.C. 1003
●
P.C. 1003: the Canadian government imported the Wagner Act model in 1944; under the War
Measures Act, it was introduced by the Privy Council as P.C. 1003
●
Canada passed its own version of the Wagner Act in 1944, following a nine-year delay.
●
World War II and employer resistance postponed the introduction of labour legislation in
Canada.
●
Dissatisfaction among workers, particularly in the steel industry, led to increased conflict.
●
Prime Minister William Lyon Mackenzie King enacted P.C. 1003 in 1944, resembling the Wagner
Act but intended as a temporary measure.
●
The 1948 Industrial Relations and Dispute Investigation Act (IRDIA) replaced P.C. 1003 at the
federal level, influenced by the Snider case and provincial jurisdiction over labour policy.
●
Each province extended the IRDIA or enacted similar legislation.
●
Union density in Canada increased from 16% in 1940 to 30% in 1948.
●
The Wagner Act model became the foundation for the postwar industrial relations system,
fostering unionization and economic growth in both Canada and the United States.
●
Under the Constitution Act, the Parliament of Canada holds jurisdiction over labor relations in
several important industries, as outlined in the Canada Labour Code, Part I. These industries
include:
○
Broadcasting (radio and television)
○
Chartered banks
○
Postal service
○
Airports and air transportation
○
Shipping and navigation (including loading and unloading of vessels)
○
Interprovincial or international transportation by road, railway, ferry, or pipeline
○
Telecommunications
○
Industries declared to be for the general advantage of Canada, such as grain handling
and uranium mining and processing.
UNION RECOGNITION UNDER THE WAGNER ACT MODEL
The Wagner Act was passed during a time of intense conflict which was not restricted to labour and
management because employees could belong to more than one union. To deal with conflict, wagner act
provided the following.
1. 1. Recognition strikes and lockouts were declared illegal.
2. As a substitute for industrial conflict over union recognition, labour boards were established to
provide a process whereby employees could obtain union recognition by a free expression of
support.
3. The union that obtained recognition was granted exclusive jurisdiction to represent all
employees in a given bargaining unit. This is known as the exclusivity principle.
○
exclusivity principle the idea that a union is granted the sole right to represent all
employees in the defined bargaining unit
LABOUR BOARDS
●
Neutral labour relations boards play a crucial role in the North American model of industrial
relations, providing a faster, more cost-effective alternative to courts and possessing expertise in
industrial relations.
●
Tripartite: a tripartite board has three stakeholders: management, labour, and government
○
main function is to enforce the Labour Relations Act and handle certification,
decertification, unfair labor practices, and declarations of illegal strikes or lockouts.
●
In Canada, automatic certification based on signed cards without a formal vote is possible in
certain provinces, while in others, certification without a vote may occur if a firm has engaged in
unfair labor practices and the true wishes of employees would likely not be expressed through a
vote.
●
Certification: recognition of a union by a labour board after completion of the procedures under
the labour act
●
Key aspects of the recognition process include defining the bargaining unit and addressing unfair
labor practices.
BARGAINING UNIT
●
The labor board determines which employees can be included in the bargaining unit based on
criteria, impacting the required percentage for union representation.
●
bargaining unit: the group of employees in an organization that are eligible to be represented by
a union
MANAGEMENT EMPLOYEES
●
are excluded from union representation
●
employees who have supervisory responsibility over bargaining-unit employees
●
Those having confidential information with respect to labour relations
●
The rationales for excluding managers are
1. access to confidential labour relations information might compromise management's position in
bargaining; and
2. the union would be in a conflict of interest if a union member was disciplined by another union
member.
COMMUNITY OF INTERESTS
●
main criterion for forming a bargaining unit is the existence of a community of interests among
employees.
●
Disputes may arise regarding the inclusion of part-time employees with full-timers or whether
office and plant employees belong in the same unit.
●
Excessive bargaining units can lead to labor instability, while units that are too small may lack
effective bargaining power.
WISHES OF EMPLOYEES
●
Boards take into account whether employees wish to be separate from or part of a defined
group.
EMPLOYER STRUCTURE
●
The labor board takes into account the employer's structure when determining appropriate
bargaining units for collective bargaining. F
●
or example, if a firm has two plants in the same city with similar products, management, pay
structure, and jobs, the board may decide that the employees of both plants form a single
bargaining unit.
●
In such cases, the union would need to organize both plants to represent the employees. The
selection of a bargaining unit can often lead to conflicts between management and labor.
UNFAIR LABOUR PRACTICES
●
Unfair labor practices are violations of the Labour Relations Act by employers, unions, or
employees, with the aim of protecting workers' freedom to choose a union and preventing
coercion or intimidation.
●
Prohibited actions include illegal strikes, lockouts, and refusal to bargain collectively.
●
Labor board remedies for such violations include cease-and-desist orders, reinstatements for
employees fired for union activities, and orders to resume bargaining in cases of bad faith.
DUTY OF FAIR REPRESENTATION
●
duty of fair representation: a legal obligation on the union 's part to represent all employees
equally and in a non-discriminatory manner
COLLECTIVE BARGAINING
GOOD FAITH BARGAINING
●
good faith bargaining: an obligation on union and management to make a serious attempt to
reach a settlement
●
labor boards are hesitant to interfere in private negotiations.
●
Since the majority of cases are resolved through mediation, labor boards rarely address good
faith bargaining unless clear evidence of anti-union behavior is present.
DISPUTE RESOLUTION
●
Canadian labor laws differ from the Wagner Act by involving greater government intervention in
collective bargaining, including a ban on strikes during the term of a collective agreement and
mandatory government conciliation or mediation before a legal strike can occur.
●
While controversial, this intervention is seen as necessary to avoid costly strikes and ensure
stability of supply in Canada's raw materials exports.
●
government's role in collective bargaining has expanded over time through measures such as
industrial inquiry commissions, mandatory voting on last offers, and arbitration to settle disputes
over the first collective agreement.
●
Voluntarism the notion that collective bargaining is a private matter between the parties and
that government intervention should be kept to a minimum
●
Mediation a dispute-resolution process in which a neutral third party acts as a facilitator
●
Conciliation see mediation
●
Arbitration a quasi-judicial process whereby a neutral third party makes a final and binding
determination on all outstanding issues in dispute
EXAMPLES OF THE EXPANDED GOVERNMENT ROLE IN COLLECTIVE BARGAINING
INDUSTRIAL INQUIRY COMMISSION
●
Inquiry commissions are employed, though rarely, by governments to investigate the causes and
consequences of industrial actions and strikes.
LAST-OFFER VOTE
●
Labor laws have been changed to address employer concerns about unions initiating strikes
without consulting their members on the last offer.
●
Amendments allow for forced votes, but the process varies across Canada.
●
In Ontario, employers can request a last-offer vote during an ongoing strike (one vote per
dispute), and the Ontario minister can order a vote if it serves the public interest.
●
In other jurisdictions, including the federal level, the minister has discretion in deciding whether
to hold a vote.
FIRST CONTRACT ARBITRATION
●
In the United States, the Wagner Act has seen only two amendments since 1935, whereas
Canadian labor laws have undergone regular adjustments to support collective bargaining and
unions.
●
First contract arbitration, which addresses the issue of union security, is a notable example of
this.
●
In Canada, eight out of eleven jurisdictions have adopted one of three models for first contract
arbitration.
●
These models involve remedies for bad faith bargaining, a complete breakdown in bargaining, or
a no-fault approach.
●
The specific approach varies across provinces and at the federal level.
REPLACEMENT WORKER LAWS
●
Policies regarding the use of replacement workers during strikes or lockouts vary significantly.
Quebec and British Columbia have complete bans on strikebreakers.
●
Ontario, Manitoba, and Alberta prohibit the use of professional strikebreakers. Manitoba, Prince
Edward Island, and Saskatchewan prevent permanent replacement of employees but only after a
strike has occurred.
●
The federal Canada Labour Code prohibits the use of replacement workers if their intention is to
undermine the union.
●
New Brunswick, Newfoundland, and Nova Scotia do not have significant policies concerning the
use of replacement workers.
COLLECTIVE AGREEMENT ADMINISTRATION
●
In Canada strikes are prohibited during the term of a collective agreement. This provision, known
as the "labour peace" provision, is included in all Canadian jurisdictions.
●
However, there is debate among scholars about whether this restriction actually ensures labour
peace, as illegal strikes still occur relatively frequently in Canada.
●
The law deems the labour peace provision to be included in every collective agreement, even if
the parties did not explicitly agree to it.
●
arbitrators play a significant role in settling disputes under Canadian law, with an expanded
public policy role in interpreting employment laws.
ROLE OF THE CHARTER
●
The Charter includes rights such as freedom of association, but these rights are subject to
reasonable limits justified in a free and democratic society.
●
governments can invoke the "notwithstanding clause" to override certain freedoms or rights for
a period of five years.
REVIEW OF SUPREME COURT CHARTER DECISIONS
RIGHT TO STRIKE
●
"Labour Trilogy" refers to three significant cases in Canada: the restrictions on the right to strike
in Alberta, the federal government's wage controls, and back-to-work laws in Saskatchewan.
●
In these cases, the Supreme Court initially ruled that freedom of association did not include the
right to strike and bargain collectively.
●
These decisions were seen as unfavorable for organized labor and raised concerns about the
Charter's ability to protect workers' rights. However, subsequent court decisions have reversed
these outcomes, leading to more positive outcomes and a more labor-friendly direction in some
cases.
UNION DUES
●
The Lavigne decision in 1991 compared to the Abood case in the US showcased the difference in
views on freedom of association and collective bargaining.
●
While the US ruling focused on individual rights and refunded union dues used for
non-bargaining purposes, the Canadian court justified the limitation on freedom of association
by recognizing unions' broader social and political goals.
●
The Canadian Charter respects both individual and collective rights, as stated in Lavigne v.
OPSEU.
PICKETING
●
In the Pepsi-Cola case (Pepsi-Cola v. RWDSU, [2002] 1 S.C.R. 156), the Supreme Court of Canada
(SCC) ruled that secondary picketing is protected as freedom of expression.
●
The court allowed peaceful picketing at locations other than the company's premises. The case
involved protests during a lawful strike and lockout
●
the court quashed the section that prohibited picketing at secondary locations, allowing
peaceful picketing to continue.
UNION RECOGNITION
●
In 1994, Ontario enacted the Agricultural Labour Relations Act (ALRA), granting trade union and
collective bargaining rights to agricultural workers.
●
a year later, the ALRA was repealed by the conservative government, subjecting agricultural
workers to exclusion from the labor relations regime.
●
The United Food and Commercial Workers (UFCW) challenged the repeal, arguing that it violated
workers' rights under the Canadian Charter of Rights and Freedoms.
●
The Supreme Court of Canada (SCC) ruled in favor of the UFCW, declaring the legislation
unconstitutional.
●
The SCC emphasized the importance of freedom of association and the chilling effect caused by
the exclusion of agricultural workers from labor protections. The decision affirmed the right of all
Canadian workers to organize without fear of reprisals and highlighted the responsibility of
governments to intervene to ensure freedom of association..
POLITICAL ACTIVITY
●
In 1991, the Supreme Court of Canada ruled in Osborne v. Canada (Treasury Board) that
restrictions on the political activities of civil servants violated freedom of expression.
●
The Public Service Employment Act had made it illegal for public servants to engage in partisan
political expression or activities under the threat of disciplinary action, including dismissal.
●
The Court found that these restrictions explicitly targeted expressive activity and were
inconsistent with Section 2(b) of the Canadian Charter of Rights and Freedoms. The Court
emphasized that limits on freedom of speech should be determined through a balancing test
under Section 1 of the Charter, rather than restricting the guarantee itself.
A NEW DIRECTION FOR THE SUPREME COURT
●
decisions by the Supreme Court of Canada, including Pepsi-Cola, Dunmore, and Advanced
Cutting, have led to the emergence of a new Labour Trilogy that has been favorable for labor
rights.
●
These decisions have expanded collective rights, picketing rights, freedom of expression, and
union recognition.
●
In a significant reversal, the Court declared collective bargaining a constitutional right under the
freedom of association guarantee in a landmark decision in 2007. The Court has relied on
international labor standards, such as those set by the ILO, to support its reasoning.
●
Another important development was the Supreme Court's ruling in 2015, granting members of
the RCMP the right to join unions and engage in collective bargaining.
●
The Court emphasized that collective bargaining is essential for employees to pursue their
collective interests and maintain a balance of power in the workplace.
●
It recognized collective bargaining as a fundamental aspect of Canadian society, enhancing the
autonomy and dignity of workers.
A RIGHT TO STRIKE
●
January 30, 2015, the Supreme Court of Canada recognized the constitutional right to strike as
part of freedom of association
EMPLOYMENT LAW
●
employment law in Canada has expanded.
●
The shift from collective bargaining to a system of rights and obligations applicable to all firms
and employees, regardless of unionization, has created a tension between individual and
collective rights.
EMPLOYMENT CONDITIONS
typically established by legislation with minimum standards.
HOURS OF WORK
two models for regulating hours-of-work provisions.
●
the law provides for a standard workday or work week and for overtime pay if the standard is
exceeded;
●
there are standard hours of work and a legal maximum number of hours per day or per week.
OVERTIME AND OVERTIME PAY
●
worked in excess of the standard hours specified in the Code or Regulations. At least one and
one-half (1.5) times the regular rate of pay must be paid for hours worked during overtime.
SCHEDULING OF HOURS
●
Some employers may be required to give notice to employees in advance of changes in
scheduled hours
COFFEE AND MEAL BREAKS
●
In British Columbia, Manitoba, New Brunswick, Ontario, Prince Edward Island, Quebec, and
Saskatchewan, employees are entitled to a meal break of at least 30 minutes after working for
five consecutive hours. Usually, this break is unpaid unless the employee is required to stay at
their workstation or be available for work during the break.
●
There is no legal requirement for employers to provide a coffee break. However, in Ontario,
Quebec, or Saskatchewan, if a coffee break is given, employers must consider it as time worked.
EXCLUSIONS
●
includes students, members of designated professions, ambulance drivers and attendants,
domestics, fishers, farm workers, construction workers, and managerial staff.
●
more flexible arrangement of work hours for certain jobs may be permitted by the statutes.
EMPLOYEE RIGHTS
HUMAN RIGHTS
●
Human rights are protected in each of the eleven jurisdictions by means of a human rights
commission.
●
Under the Canadian Human
●
Rights Act, it is against the law for any employer or provider of a service that falls within
●
●
federal jurisdiction to discriminate on the basis of
○
Race;
○
national or ethic origin;
○
Colour;
○
Religion;
○
Age;
○
sex (including pregnancy and childbearing);
○
sexual orientation;
○
marital status;
○
family status;
○
physical or mental disability (including dependence on alcohol or drugs); or
○
pardoned criminal conviction.
Employee complaints regarding human rights violations are addressed through tribunals formed
by provincial or federal commissions. These tribunals consist of impartial adjudicators.
●
The Human Rights Act also safeguards employees from harassment perpetrated by other
employees.
●
Harassment creates obstacles to equality, as it degrades victims, hampers their productivity, and
in extreme cases, may lead them to resign.
HEALTH AND SAFETY
●
Canada follows what is known as the internal responsibility model (IRM), which emphasizes
establishing a framework within which the workplace parties mutually address health and safety
concerns.
●
The IRM mandates employee involvement by conferring three basic rights and responsibilities
upon workers:
○
the right to know about the hazards to which they are exposed;
○
the right to participate in mandatory joint worker- management health and safety
committees; and
○
the right to refuse unsafe work without fear of reprisal.
PAY AND EMPLOYMENT EQUITY
●
pay equity: women and men being paid relatively equally for work of equal value
●
employment equity: equity in employment levels and opportunities between targeted
community groups (women, visible minorities, Indigenous persons, and disabled employees) and
major employers
●
It is important to distinguish between direct and systemic discrimination:
○
Direct discrimination occurs when, for example, an employee discriminates against a
fellow employee.
○
Systemic discrimination occurs when the organizational rules are followed but protected
groups are disadvantaged.
●
Direct discrimination can be addressed through human rights complaints or a union's grievance
procedure, while systemic discrimination is more challenging to prove and rectify as it can be
embedded in various human resources functions.
●
Employment equity involves treating individuals differently and implementing special measures
to accommodate differences.
●
Ontario's Pay Equity Act is regarded as progressive and has led to pay increases for many
women. Each province has its own pay equity legislation covering both the public and private
sectors.
INTERNATIONAL LAW
●
Globalization and increased capital mobility have brought new challenges and opportunities for
labor. L
●
labor policies are transitioning from a state-centered model to one that considers international
factors. The International Labour Organization (ILO), a United Nations agency, plays a crucial role
in shaping labor rights. F
●
freedom of association and expression are seen as fundamental human rights, not subject to
political whims.
●
The ILO has established international labor standards through conventions that nation-states are
encouraged to ratify. Canada has ratified Convention 87 (freedom of association), Convention 98
(right to organize and collective bargaining), and has voted in favor of the 1998 Declaration on
Fundamental Principles and Rights at Work and the 2008 Declaration on Social Justice for a Fair
Globalization.
●
These declarations emphasize principles such as freedom of association, elimination of forced
labor and child labor, and the elimination of employment discrimination. The ILO and its
members are urged to implement a decent work agenda, enhancing governance and capacity
building to effectively promote the objectives of the declarations.
Chapter 6: THE MANAGEMENT PERSPECTIVE
THE EVOLVING MANAGERIAL VIEW
MASTER-SERVANT RELATIONSHIP
●
Master-servant relationship: the essence of the common-law employment relationship
pertaining to non-union workplaces
●
Chapter 2 discusses the power imbalance in the early employment relationship. Organized labor
emerged in response to this environment to address the power imbalance between
management and labor.
SCIENTIFIC MANAGEMENT (TAYLORISM)
●
Task specialization became prominent, with workers specializing in a small number of tasks or
even a single task.
●
originated with Frederick Taylor's theory of scientific management where he proposed two
principles: dividing work into simple tasks and training workers to perform them, while managers
handled planning and decision-making. This approach maintained elements of the
master-servant relationship, where employees were seen as extensions of the machines they
operated.
●
The goal was to increase efficiency and reduce costs in the production line.
HUMAN RELATIONS
●
human relations: a managerial view that believes that effective management practices can
minimize the conflict between managers and employees
●
believed that conflicts between managers and workers could be resolved through effective
policies and procedures. It emphasized the importance of leadership, improved communication,
humanistic workplace design, and participative decision-making in enhancing the workplace.
●
studies revealed that factors like lighting and breaks had an impact on workers' productivity,
highlighting the need for attention to the work environment and workers' job satisfaction and
social needs.
HUMAN RESOURCES MANAGEMENT (HRM)
●
HRM focuses on the relationship between individual employees and their employers, with an
emphasis on issues such as employee selection, performance appraisal, training, and
compensation.
●
HRM professionals aim to balance fairness in workplace procedures with organizational
efficiency and productivity.
●
Efficiency described in terms of organizational outputs such as profits, revenues, and
productivity. It focuses on the organization's needs.
●
equity is described as terms of fair, or ethical, treatment of employees by employers.
●
Barbash (1987) highlighted five elements of equity:
1. Employees need to have a say in the work they perform (also known as voice).
2. Employees require due process in the handling of complaints.
3.
Employees are entitled to fair treatment at work.
4. Employees are entitled to meaningful work.
5. Employees need fair compensation and secure employment.
●
IR sees unions as focusing on these five elements of equity while management focuses on
efficiency.
●
Organizational justice theory, a key aspect of HRM, pertains to perceptions of fairness in the
workplace. It includes distributive justice (fairness of outcomes or decisions), procedural justice
(fairness of procedures used), and interactional justice (fairness of interpersonal interactions and
exchanges).
THE GROWING ROLE OF MANAGEMENT
THE STRATEGIC CHOICE FRAMEWORK
●
Kochan, Katz, and McKersie's seminal work in the 1980s focused on the role of management in
transforming the industrial relations (IR) system.
●
Trends in the United States during that period included a decline in unionized workers,
employers opening non-union locations, plant closures in heavily unionized states, decreased
capital expenditures in non-unionized plants, a shift of products to non-union plants, and a push
for "union-free" workplaces.
●
The National Labor Relations Board and the government exhibited anti-union tendencies, such
as appointing "employer-friendly" members and adopting a pro-management/anti-union
approach.
●
Kochan, Katz, and McKersie's strategic choice framework emphasized three levels of IR decisions:
business level, collective bargaining level, and workplace level.
○
The business (or strategic) level represents the organization's senior management, who
develop and implement long-term strategies. The collective bargaining level is where
collective agreements are negotiated and implemented. The workplace level focuses on
the front-line managers who deal with day-to-day workplace issues within the
organization.
●
Effective strategies required alignment and coordination among these levels to achieve major
goals with a long-term focus.
●
Strategic choices made by one actor can have a long-term impact on other actors and the overall
IR system.
●
strategic choice framework: a view that emphasizes the role of management and strategies in
the industrial relations system
STRATEGIC CHOICE AND CANADA
●
Arguments regarding the potential for a non-union industrial relations (IR) system in
Canada emerged after the release of Kochan and colleagues' (1986) book.
●
Some arguments supporting the idea of a movement towards a non-union IR system in
Canada include:
○
Canada has historically followed industrial relations trends in the United States
○
the sheer number of multinational corporations that are headquartered in the
United States and operate in Canada will encourage a similar transition here in
Canada;
○
there is a low level of union density in the private sector
○
increased global competition will encourage employers to avoid the increased
wage and benefit costs associated with unionization;
●
progressive HRM techniques may result in employees no longer seeing significant
advantages to unionization, making such workers difficult to organize;
●
there has been a rise in largely non-unionized industries (e.g., retail, business services);
and
●
governments are taking actions that may be seen as "pro-management."
●
factors suggesting that Canada will not experience a significant shift away from
unionization include the relatively stable union density rate of around 30%, the
resilience of unionization in the highly unionized public sector, unions making inroads in
new sectors, and the potential for a non-union system in some sectors while others
remain unionized.
●
The view is that Canada is not moving towards a union-free model, with unionization
rates remaining steady, the public sector remaining heavily unionized, limited evidence
of a pro-management government agenda, and unions expanding into new industries.
●
However, there are changes in the union-management relationship, with management
playing a more dominant role in the IR system, and some evidence supporting the
transformation of different sectors within the IR system.
INDUSTRIAL RELATIONS AND BUSINESS STRATEGIES
overall business/organizational strategy process typically consists of four phases:
1. Assessment of the external and internal environments.
○
SWOT-like analysis is conducted to identify strengths, weaknesses, opportunities, and
threats.
2. Strategy formation
○
Mission statement development based on the SWOT analysis.
○
Breaking down the mission into specific performance goals.
○
Setting SMART goals: specific, measurable, attainable, relevant, and time-based.
○
Developing strategies to achieve the performance goals.
3. Strategy implementation
○
Putting the formulated strategy into action.
4. Strategy evaluation
○
Examining the effectiveness of strategy implementation and goal achievement.
○
Identifying factors influencing the success or failure of the industrial relations strategy.
○
Refining the strategy and restarting the process based on the evaluation results.
important for an organization to ensure that its strategy aligns with its people-management strategy.
Strategic HRM refers to the management of HRM philosophies, policies, and practices in a way that
supports the achievement of the organizational strategy. The goal of strategic HRM is to ensure that
HRM strategies and practices are in line with and contribute to the overall organizational strategy.
●
Overall human resources philosophy. This defines the values of the organization as it relates to
employees and human resource issues.
●
Specific policies. These include formal (and usually written) policies and guidelines that can
outline, and even constrain, specific human resource strategies.
●
Specific practices. For example, those related to various typical human resources functions (i.e.,
selection, promotion, layoff, performance management, compensation, training, etc.).
MANAGEMENT STRATEGIES RELATED TO UNIONS
●
Strategic HRM includes aligning the human resources functions of staffing, training and
development, performance appraisal, and compensation with the organization's direction.
●
four management strategies related to unions that are still examined in IR circles today:
○
Union acceptance
○
Union resistance
○
Union removal
○
Union substitution
UNION ACCEPTANCE
●
union acceptance: management's seeing unionization as a democratic right, and accepting that
part, if not all, of its operations will be unionized
●
Management accepts the presence of a union but aims to negotiate favorable terms to meet
operational needs.
●
This strategy does not mean surrendering control to the union but rather finding a balance.
●
Management may collaborate with the union, leveraging its resources to co-create policies and a
positive work environment.
UNION RESISTANCE
●
union resistance: a management policy seeking to limit the spread of unions in the firm
●
consists of two elements: acceptance of existing unionized parts of the organization and active
opposition to further unionization.
●
Management negotiates in good faith with the existing unionized workforce but opposes any
attempts to expand union representation.
●
Union resistance strategies may involve actions such as opposing union drives, challenging
certification, and employing various union avoidance behaviors.
●
Union avoidance behaviors can include illegally firing union organizers or supporters, limiting
union access to the workplace, hiring consultants for anti-union campaigns, training managers to
oppose unionization, and threatening closure if the operation becomes unionized.
UNION REMOVAL (union busting)
●
union removal: a management strategy designed to remove the union from the workplace
●
There are two elements to union removal.
○
First, management aims to ensure that unionized employees' working conditions, wages,
and benefits are not superior to those of non-union employees, conveying the message
that the union is not providing better terms and conditions of employment.
○
Second, in non-unionized workplaces, management seeks to discourage union activity by
portraying unionization as having little to offer and openly opposing any union
certification drives.
●
Union removal strategies include actions such as equalizing conditions between unionized and
non-unionized employees and resisting union certification efforts.
UNION SUBSTITUTION (union avoidance)
●
union substitution: a management strategy designed to give non-union employees all the
advantages of unionization
●
The goal of union substitution is to offer non-union employees due process elements,
representation, and compensation advantages similar to what would be provided through a
collective agreement negotiated by a union.
●
Non-union employers often have employee handbooks that contain policies on various
employment aspects such as discipline, discrimination, hours of work, wages, benefits, appeal
processes, and performance expectations. These policies function as substitutes for collective
agreements.
●
Through their HRM policies and practices, management attempts to provide a substitute to
unionization, making employees perceive unionization as unnecessary.
MANAGEMENT STRATEGIES TOWARD UNIONS: EVIDENCE TO DATE
●
there hasn't been a radical shift towards union removal policies in Canada. While many
employers accept the legitimacy of unions in their currently unionized workplaces, there is a
trend towards union resistance in non-union environments, particularly in newer operations.
●
there are indications of various strategies related to union substitution, union resistance, and
union removal in specific sectors, suggesting a mixed landscape of approaches in Canadian
industrial relations.
CURRENT MANAGERIAL PERSPECTIVES AND TRENDS
HIGH-PERFORMANCE WORKPLACES AND WORK PRACTICES (HPWPs)
●
High-performance work practices (HPWPs): comprehensive human resources practices
designed to improve organizational performance
●
HPWPs can be categorized into three clusters
○
Ability-enhancing practices. These practices are designed to ensure that employees have
the needed skills, knowledge, and abilities to enhance organizational performance. Thus,
HR practices related to the selection and training of employees are critical here.
○
Motivation-enhancing practices. Motivational HR practices can include individual and
group pay incentives, performance appraisals, promotion based on merit/performance,
and due process mechanisms (e.g., grievance and appeal processes), all of these
designed to ensure fair treatment in the workplace.
○
Opportunity-enhancing practices. Here we see the importance of practices related to
voice and employee involvement. Thus, HR practices related to information sharing,
autonomy, teams, and participation fall into this cluster.
●
The goal of HPWPs is to improve employee knowledge, skills, and abilities, motivate high
performance, minimize turnover, reduce work avoidance, and encourage nonperformers to leave
the organization.
●
HPWPs have both benefits and potential negative impacts on workers and their unions. They can
contribute to improved pay, fair treatment, better work environments, and greater employee
voice. However, they can also lead to increased stress, fatigue, and workloads.
●
The union-HPWPs relationship is inconclusive. Unions can facilitate trust, job security,
investments, and communication for successful HPWP adoption. They align with promotion,
training, and fair selection. However, unions may resist due to adversarial history, job security
concerns, and limitations on management's flexibility.
●
Cooperative relationships between unions and management can overcome barriers to HPWP
adoption and positively impact organizational competitiveness.
●
Canadian evidence suggests that unionization combined with an employee-focused business
strategy improves profitability, workplace climate, and dispute resolution.
●
increased use of HPWPs was associated with increased sick days, unpaid overtime, and more
disputes/grievances. However, the presence of a union countered these effects and was
associated with higher job satisfaction when HPWPs were in place.
NON-UNION EMPLOYEE REPRESENTATION
●
non-union employee representation (NER) occurs when a group of non-union employees meets
with management regarding employment terms and conditions
●
primary goals of such plans are
○
to improve communication between workers and management;
○
to increase access to workplace dispute resolution and justice mechanisms; and
○
to negotiate better terms and conditions of employment.
EVOLUTIONARY
●
provides a gradual improvement in workers' economic position and voice but often lacks the
presence of an independent union that can truly advocate for employees.
●
As workers realize the limitations of NER in effecting significant change, they may become
frustrated and see the need for a union.
UNITY OF INTEREST
●
usually initiated by management, seeks to create a harmonious organization.
●
It involves the alignment of employees to the organization's goals, increased cooperation, and
improved communication and information-sharing.
●
In exchange, employees receive better working conditions and voice.
UNION AVOIDANCE
●
main purpose is to avoid unions, with NER as the substitute.
●
Employers design the plan to reduce the likelihood of unionization.
●
employers "buy off" employees by providing them with more than the union could in terms of
wages, working conditions, and dispute resolution and voice
●
often accompanied by scare tactics, punishment, and even unfair labour practices as ways to
minimize the likelihood of unionization.
COMPLEMENTARY VOICE (DUAL CHANNEL)
●
Complementary voice model: NER and unions are viewed as complementary employee
representation models.
●
Advantages for firms: Non-confrontational NER governance combined with standardization of
pay, benefits, and working conditions through union voice.
●
Advantages for employees: Union protection and bargaining power combined with individual
voice.
●
Dual channel in some cases: Different working groups within the same company may have
unionized workers and non-union NER for office and management workers (e.g., FedEx).
●
Managerial practices for NER success: Pay and benefits meeting or exceeding unionized workers'
standards and commitment to making the plan work.
●
Importance of employee voice: Significant changes in the workplace require employees to have
sufficient voice.
●
Evolution form of NER: Creates collective mechanisms similar to unions.
●
Rapid movement toward public sector unionization: Limited power of associations in non-union
workplaces may lead employees to opt for a union when given the option.
PROFESSIONAL ORGANIZATIONS-A SPECIAL FORM OF NER
●
Canadian union certification procedures often exclude professionals such as lawyers, physicians,
engineers, and architects because they are often self-employed or employed under contract. So
would not meet definition of employee
●
However, many of these professionals are members of professional associations.
●
These associations often set minimum standards for licensing and provide mechanisms for group
access to health benefits and retirement investment planning.
●
Professional associations also set provincial standards for fees.
●
Professional associations can be seen as "quasi-unions" as they act as closed shops, limiting
employer ability to hire from outside of the "union."
●
Some employers are now moving toward a "quasi-union" model, negotiating collectively with
elected members of these associations.
●
They use joint committees and even agree to arbitration processes to settle disputes.
NONSTANDARD WORK ARRANGEMENTS
●
nonstandard work arrangements work arrangements that differ from the norm in terms of
employment term, location, schedule, hours of work, or pay
○
The norm used to be standard jobs with one employer, full-time work, extensive
benefits, and indefinite employment.
●
Nonstandard work arrangements are often implemented to reduce labor costs, adjust labor
levels, maximize management flexibility, and improve business performance.
●
Employers argue that nontraditional work arrangements offer flexibility, work-life balance,
improved recruitment and retention, reduced turnover, employee stress, commuting time, and
childcare costs.
●
Gig work is a special form of nonstandard work, including crowdwork and app-based work.
●
Over 40% of Canadians have some form of nonstandard work arrangement.
●
Most new jobs are considered nonstandard, especially for new entrants into the labor force.
●
Certain groups, such as young people, women, minority group members, and bridge employees,
are more likely to work in nonstandard jobs.
●
Unionized workers generally have less access to variable work schedules due to collective
agreements and equity-efficiency considerations.
●
Nonstandard work arrangements often result in fewer benefits, lower wages, and less job
security compared to "standard" jobs.
●
Unions often view nonstandard work as precarious employment with negative characteristics.
●
Global competition and the role of artificial intelligence (AI) may further drive the reliance on
nonstandard work for flexibility and adaptability.