The May issue of the ILR Review is devoted to research on international and comparative labor and employment relations. Please see the overview editorial essay by Paul Marginson. Papers cover the neoliberal turn in French industrial relations, European outsourcing and contingent labor strategies, labor relations in post-Communist regimes, union mergers in Germany, flexicurity, work uncertainty and HR practices, local strategies against multinationals, global framework agreements, gender discrimination in hiring – and more.
May 2016; Vol. 69, No. 3
Editorial Essay: Introduction to the International Theme of the May 2016 Issue
Abstract: The author advances the literature on the role of the state in the decentralization of industrial relations in France by providing a political economic analysis of Right- and Left-backed governments in recent decades. While both have pursued reforms to reduce regulation and to increase labor market flexibility, they have used the state apparatus in different ways to achieve these goals. The Right has reformed labor law by obtaining partial support from employers’ associations and unions—the social partners. The Left, by contrast, has relied on decentralized bargaining with the social partners because its political base would not have accepted flexibility-increasing legal reforms. The author examines critical episodes of reform in collective bargaining, unemployment insurance, and employment protection laws to show how the state has intervened in different ways depending on the political identity of the governing coalition.
Contesting Firm Boundaries: Institutions, Cost Structures, and the Politics of Externalization
Virginia Doellgast, Katja Sarmiento-Mirwaldt, and Chiara Benassi
Abstract: This article develops and applies a framework for analyzing the relationship among institutions, cost structures, and patterns of labor–management contestation over organizational boundaries. Collective negotiations related to the externalization of call center jobs are compared across 10 incumbent telecommunications firms located in Europe and the United States. All 10 firms moved call center work to dedicated subsidiaries, temporary agencies, and domestic and offshore subcontractors. A subset of the firms, however, later re-internalized call center jobs, in some cases following negotiated concessions on pay and working conditions for internal workers. Findings are based on 147 interviews with management and union representatives, archival data on restructuring measures and associated collective agreements, and wage data gathered through collective agreements and surveys. The authors argue that variation in outcomes can be explained by both the extent of the cost differentials between internal and external labor and the ease of exiting internal employment relationships, which in turn affected patterns of contestation associated with externalization measures.
Between Strategy and Unpredictability: Negotiated Decision Making in German Union Mergers
Martin Behrens and Andreas Pekarek
Abstract: Restructuring through mergers has been a key strategy of union revitalization. In Germany, union merger activity has been extensive but seemingly unpredictable in its outcomes, with failed mergers outnumbering successful attempts by a ratio of 2:1. The authors use case studies of two attempted union mergers in Germany—one failed and one successful—to exemplify how these complex processes unfold. Drawing on Walton and McKersie’s (1991) work on negotiation, the authors show how common decision-making processes involving key actors at various organizational levels shape the trajectory of merger attempts. Looking beyond mergers to broader questions of union strategy, the authors argue that the concept of negotiated decision making can help reveal the strategic and logical dimensions of apparently unpredictable processes.
Flexibility and Security within European Labor Markets: The Role of Local Bargaining and the “Trade-Offs” within Multinationals’ Subsidiaries in Belgium, Britain, and Germany
Valeria Pulignano, Nadja Doerflinger, and Fabio De Franceschi
Abstract: In this comparative qualitative study, the authors examine how local bargaining shapes the trade-off between labor flexibility and employment security policies in four multinational subsidiaries in Belgium, Britain, and Germany. They also consider whether and how union power to shape flexibility and security policies is affected by national institutions, the way that multinationals organize their subsidiaries, and local contextual factors. Findings support this multilevel, interdependent framework. Trade-offs are shaped by differences in workers’ structural power in specific local subsidiaries. Differences in inter-subsidiary organizational configurations, markets, and technologies modify how unions can leverage collective resources to wield power in their relationship with management.
Translating European Labor Relations Practices to the United States Through Global Framework Agreements? German and Swedish Multinationals Compared
Markus O. Helfen, Elke Schüßler, and Dimitris Stevis
Abstract: Extensive research has shown that European multinational enterprises (MNEs) have a propensity to avoid collective employee representation when going abroad. This study investigates whether Global Framework Agreements (GFAs) can reverse this pattern by comparing how four European MNEs—two from Germany and two from Sweden—implement GFAs in the United States, a country with weak collective representation rights. The authors find that an MNE’s home country labor relations (LR) system mediates whether GFAs support collective representation in the United States. Sweden’s monistic LR system, in which unions are the dominant organizations legally representing workers, gives unions the power to directly influence the negotiation and implementation of GFAs. By contrast, Germany’s dualistic LR system, in which unions and works councils share worker representation, weakens the influence of unions on implementing the GFA. MNEs’ home country LR systems thus influence how transnational instruments are used to improve collective representation in host countries.
Abstract: Using data from the fourth and fifth European Working Conditions Surveys, the author examines how work uncertainty and the use of individual and bundled human resource practices are associated with employees’ extensive work effort. Results at both the employee and country-industry levels of analysis show that work uncertainty and several human resource practices have a direct and positive association with employee overtime as a measure of extensive work effort. Moreover, training, task rotation, teamwork, and the human resource bundle act as mediators by transmitting part of the effect of work uncertainty to employee overtime.
Shadows of the Past: The Effect of Communist Heritage on Employee Consultation
Simon Oertel, Kirsten Thommes, and Peter Walgenbach
Abstract: Following research on transition economies in Central and Eastern Europe (CEE), and having been motivated by arguments pertaining to the business systems approach, the authors propose that the existence of a communist heritage decreases the likelihood that employees will be consulted during organizational change processes. Results based on 23,876 firms across 27 of the European Union (EU-27) countries support this proposition. Moreover, the likelihood of direct consultation decreases with the existence of formal employee representation and an increasing share of foreign ownership in firms located in CEE countries. The authors discuss these findings in the context of organizational democracy research and the recent literature on transition economies and contribute to a more comprehensive understanding of participative decision-making processes in organizations.
Do Employer Preferences Contribute to Sticky Floors?
Stijn Baert, Ann-Sophie De Pauw, and Nick Deschacht
Abstract: The authors investigate the importance of employer preferences in explaining sticky floors, the pattern in which women are less likely, as compared to men, to start to climb the job ladder. The authors perform a randomized field experiment in the Belgian labor market and test whether hiring discrimination based on gender is heterogeneous by whether jobs imply a promotion (compared to the applicants’ current position). The findings show that women receive 33% fewer interview invitations when they apply for jobs that imply a first promotion at the functional level. By contrast, the results show that their hiring chances are not significantly affected by the authority level of the job.
Do Work Decisions among Young Adults Respond to Extended Dependent Coverage?
Youjin Hahn and Hee-Seung Yang
Abstract: Young adults aged 19 to 29 are significantly less likely than those in other age groups to have health insurance since most family insurance policies cut off dependents when they turn 19 or finish college. Between 2003 and 2009, several U.S. states relaxed their eligibility requirements to allow young adults to remain covered under their parents’ employer-provided health insurance policies. For those who qualify for these benefits, the expansion of dependent coverage partially reduces the value of being employed by a firm that provides health insurance or of working full-time, as adult children can now obtain health insurance through an alternate channel. The authors employ quasi-experimental variation in the timing and generosity of states’ eligibility rules to identify the effect of the policy changes on young adults’ labor market choices. Their results suggest that the expansion increases the group dependent coverage rate and reduces labor supply among young adults, particularly in full-time employment.
Book Review: The Globalization of Inequality
Celebrating the Enduring Contribution of Birds of Passage: Migrant Labor and Industrial Societies
Janice Fine, Ruth Milkman, Natasha Iskander, and Roger Waldinger