Published on September 29, 2015
1. Value chain fragmentation and working conditions Jan Drahokoupil Senior Researcher European Trade Union Institute, Brussels Jobs in Global Value Chains WTO Public Forum, Geneva, 2 Oct 2015
2. jan drahokoupil © etui (2015) value chain fragmentation and working conditions2 Available at www.etui.org 1. A bird-eye picture on outsourcing/offshoring in Europe 2. Impact on working conditions • WORKS project order-processing in logistics and food, customer service in public services, IT departments in health) • Call centres in telecoms • Public services • Construction, meat processing, ship building (posted work) 3. Establishing worker voice mechanism in fragmented value chains • Telecoms • Parcel delivery • Construction (posted work) • Automotive (agency work) • Metal (bargaining in MNCs)
3. Outsourcing, offshoring, and global value chains jan drahokoupil © etui (2015) value chain fragmentation and working conditions3 Source: Drahokoupil (2015, Table 1), adapted from Sako (2005) and Olsen (2006)
4. Outsourcing/offshoring and working conditions: Key mechanisms undermining job quality and pay ● Impact on existing worker representation structures and collective bargaining institutions ● Moving jobs outside of the scope of existing firm-level institutions (domestic outsourcing) ● A shift to different regulatory regimes (offshoring) ● Concession bargaining ● Employing migrant workers in fact similar avoidance effects to offshoring (labour-market intermediaries) ● Institutions may mediate outcomes, but little Q evidence ● Encompassing LM institutions (equal pay/conditions etc.), collective bargaining, and ability to mobilize across production network key ● Targeted TU campains, sectoral bargaining ● International worker voice institutions (EWCs, EFAs) jan drahokoupil © etui (2015) value chain fragmentation and working conditions4
5. Outcomes country-specific: Crucial role of domestic institutions in shaping also decisions 5 Source: Kirschner (2015, Figure 1) in Drahokoupil (2015)
6. Outsourcing/offshoring and working conditions: Key mechanisms 2 ● Restructuring of the labour process to allow decoupling a major factor (negatively) influencing job quality both in sending companies and in outsourcing destinations jan drahokoupil © etui (2015) value chain fragmentation and working conditions6 Source: Drahokoupil (2015, Table 2), adapted from Gospel and Sako (2010)
7. Conclusion ● Crucial not to focus just on employment, but also on working conditions and job quality ● Effective worker involvement key precondition for satisfactory outcomes for workers; also crucial for the success from the business perspective ● Worker voice can also prevent abuse of the Single Market institutions (e.g. posted work), but institutions to cover firm and national boundaries lacking ● EU level: tools to address these issues (e.g. agency work directive, transfer of undertakings, I&C), but implementation poor in many countries, yet make a difference in some (e.g. ToU in the UK) ● Some sectors call for entirely new institutions: e.g. Danaj & Sippola, 2015: a European construction workers union jan drahokoupil © etui (2015) value chain fragmentation and working conditions7
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