Why sector co-regulation? ✦ Work

This is the second part of a three-part series. See part one here.

Within any jurisdiction, legal strategies to raise labor standards (beyond what market forces and individual contracts can achieve) can be located along two axes: The horizontal axis represents divergence modes setting labor standards, ranging from collective bargaining – in which the government facilitates negotiations rather than imposing substantive standards – to direct government imposition of minimum standards and rights. The vertical axis represents level in which standards apply, and ranges from jurisdiction-wide standards – national, state or local – to standards set at the enterprise level.

The conventional American approach to raising labor standards is at opposite ends of the resulting grid: jurisdiction-wide minimum standards and company-level collective bargaining. No viable alternatives can be found at the two opposite ends of the grid – that is, government-imposed, enterprise-level labor standards or standards negotiated through jurisdiction-wide collective bargaining. However, the range of alternatives expands when we recognize intermediate points on each axis. Sector standards lie halfway along the vertical axis and can be set through collective bargaining or regulation. In the middle of the horizontal axis are lesser-known hybrid or “co-regulatory” strategies that involve employee representatives directly in setting and enforcing publicly imposed labor standards.

The labor standards boards in New York and California are in the middle of both axes: they set binding public standards at the sector level with the participation of employee and employer representatives and public officials. If we compare sectoral co-regulation with its alternatives on both axes identified here, we find that co-regulation has certain advantages over both collective bargaining and conventional regulation, and that sector-specific standards have advantages over both company-based and jurisdiction-wide standards . However, sectoral co-regulation is also consistent with, and may even help to support, both jurisdiction-wide minimum standards and corporate collective bargaining.

A. Co-regulation and tender strategies

State wage boards and their historic predecessors raise labor standards, but they rely on them NO on the impact of workers’ collective bargaining – on their ability to exert economic pressure on employers – but on political and regulatory power. It is important. Our labor laws promised to enable workers to secure better wages and working conditions by organizing and aggregating their bargaining power. Organized labor has long been implementing labor law reforms that could fulfill this promise. However, even if implemented, these reforms would not address the deeper problems of declining labor market power on the part of workers without advanced skills and education. (I argue elsewhere that globalization, deregulation, disruption, and technological innovation are weakening workers’ bargaining power over capital, in part by increasing employers’ ability to replace workers with other workers or technological substitutes). Employees must supplement their strength on the labor market, and not only that aggregate This. This argues for greater reliance on political power and regulatory strategies to improve work and wages at lower levels of the labor market. Relying on political power has its risks, of course; however, there are many jurisdictions where solid political majorities support higher labor standards.

The added advantage of regulatory strategies to raise labor standards lies in the arcane doctrine of federal expropriation of workers and the unequal geographic distribution of workers’ political power. Labor obviously has more political support in several blue states and cities than it does nationally. However, federal labor law preempts state and local regulations of private sector collective bargaining – including any hypothetical state or municipal sectoral collective bargaining plan. However, federal law does not prevent the adoption of higher substantive labor standards at the state or city level. Of course, states can limit cities’ legislative power, and some “red states” have thwarted progressive reforms in “blue cities.” The doctrine of expropriation may change in a way that further limits the state’s law-making power. Yet there is much more room for state and local regulation of substantive labor standards than for state and local regulation of collective bargaining.

B. Co-regulation and conventional regulation

Does the shift towards a regulatory approach mean giving up on empowering employees’ voices when formulating and enforcing labor standards? Not necessarily. Co-regulation aims to democratize standard setting by directly involving employees and their organizations in the process. Both traditional labor standard-setting strategies have their own democratic principles: Collective bargaining democratizes labor standard-setting by giving workers a voice in setting standards at the company level. Legislative minimum labor standards, in turn, reflect the voice of society at large through democratic political processes in defining decent labor standards. Co-regulation refers to any concept of democracy: it expresses the will of society, through democratic political channels, to democratize the process of developing and enforcing public labor standards by involving those whose lives and livelihoods are most directly affected by them. In this way, co-regulation leverages workers’ practical knowledge of working conditions and their self-interest in improving and enforcing labor standards.

Federal labor law was intended to democratize the setting of labor standards through collective bargaining. However, very few workers today have access to this framework, given the significant challenges associated with organizing through unions and obtaining a collective bargaining agreement. Even if labor laws were reformed to better enable workers to aggregate their bargaining power, many workers simply do not have enough of it to make up for what is lost in today’s economy.

C. Sector-specific versus enterprise- or jurisdiction-wide standards

The case for sector-specific standards – as compared to jurisdiction-wide or enterprise-level standards – is relatively simple. Sector-specific labor standards can solve the lowest common denominator problem for jurisdiction-wide standards; may be higher than what is feasible across the jurisdiction and may take into account sector-specific conditions. Sectoral labor standards, whether set through collective (benchmark) bargaining or otherwise, can also be the Achilles’ heel of corporate bargaining, limiting competition in the sector based on labor costs and forcing companies to compete on higher productivity. quality and innovation. Sectoral negotiations on core labor standards in Europe partly explain both the higher union density and the smaller increase in economic inequality in recent decades.

It is true that sector standards continue to face competition from outside the jurisdictions where sector standards dominate; and they still need to take into account productivity in the sector. However, sector standards, unlike jurisdiction-wide standards, Power vary depending on sector specifics, such as productivity and the scope of the relevant product market (local, regional, national or transnational). Sector standards can be established opportunistic in a positive sense. Higher minimum wages may be sustainable, for example in sectors with little competition (such as hospitals in many regions or Amazon warehouses) or in local product markets (such as hotels and fast food), or both.