Policy-makers challenged to find solutions targeting truly vulnerable
In February 2005, the Federal Labour Standards Review published a consultation paper looking at what forms of work should be covered by labour standards legislation. This included questions about:
• whether the scope of the legislation should be extended so some or all provisions cover self-employed workers who have no employees working for them
• whether “employee” should be defined in labour standards legislation (and, if so, how broad this definition should be and what types of work relationships it should encompass)
• the social and economic consequences of not recognizing certain kinds of work and work relationships under labour standards
• whether part-time, temporary and casual employees, and employees provided by employment agencies, are appropriately protected under federal labour standards
• the advantages and disadvantages of these forms of work for employers and employees
• the importance of these forms of work to ensure business competitiveness and economic growth
• whether legislative or non-legislative measures should be adopted to improve minimum protections and benefits for different categories of employees in non-standard work, such as modifying existing eligibility requirements for certain labour standards provisions.
Employer perspectives
While significant changes in the labour market have led to substantial growth in “new” forms of employment relationships such as self-employment and part-time work, employers generally do not see a role for labour standards in addressing issues that accompany this growth. Business organizations take the view labour standards should not deviate from the original intent (to protect workers who are directly employed by a single employer), which contrasts with the views expressed by labour and social development organizations.
Underlying these positions is a fundamental disagreement over the status and contribution of self-employment and part-time work to the Canadian labour market. Business organizations argue many of these people are highly paid and work in these arrangements by choice while labour organizations argue at least some of these people are among the most vulnerable and exploited in Canada.
Those who would limit labour standards protections to those who are in a direct employment relationship believe there is no justification for federal intrusion in an area — individuals supplied by employment agencies — that clearly falls within provincial jurisdiction.
Consequence of enhanced labour standards
One consequence of enhanced labour standards is the possibility of costs being shifted back to workers (in the form of lower wages) or forward to customers. However, cost-shifting is not always feasible, particularly in the context of prices set in world markets, which means enhanced labour standards can also result in less employment. In this situation, a trade-off has to be made between a less-protected job and no job, and it is often these alternative employment relationships that bear the brunt of these trade-offs.
As a practical matter, the growth in small firms and in non-standard employment has made monitoring and compliance even more difficult, writes Morley Gunderson, a professor at the University of Toronto in his paper Social and Economic Impact of Labour Standards, prepared for the Federal Labour Standards Review Commission. And non-standard employment may be too heterogeneous to try to “protect” in a uniform fashion, he writes.
The implications of labour-standards reform for non-standard employment pose significant challenges to policy-makers and employers. To the extent non-standard employment arrangements apply to vulnerable workers who may need or benefit from some form of labour-standards protection, policy-makers will seek out potential options for regulating these workers and their employers. However, they will be challenged with finding solutions targeted to the truly vulnerable, not the many people in non-standard arrangements by choice who derive substantial benefit from these arrangements over and above any legislated statutory minimum.
There may be reason to consider the role employers could play in reducing or eliminating the need for legislative solutions, possibly by promoting codes of conduct or other voluntary measures so people who are in non-standard arrangements are treated fairly.
Editor’s note: This is an edited excerpt from Current & Critical Issues in HR Management: The Canadian HR Reporter White Paper Series, a new monthly publication that explores trends in labour and human resource management, and provides insight on issues facing employers. For more information, visit www.hrreporter.com/wp.
