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The Power to Dismiss: Trade Unions and the Regulation of Job Security in Western Europe

1 Comment 🕔18.Jun 2015

For more than a century, the conflict between organized capital and labor has been fought over wages and working conditions. A considerably contentious issue has been the employer’s prerogative to hire and fire. Trade unions have sought to limit employer’s power to dismiss through collective negotiations with employers if they were strong enough; otherwise, they had to rely on public policy to intervene via labor law in favor of employees’ job security. Yet in recent years, employers and neoliberal reformers have aimed at deregulating employment protection. In his comparative historical study, Patrick Emmenegger, Professor of Comparative Political Economy and Public Policy at the University of St. Gallen in Switzerland, provides a comprehensive analysis of the development of employment protection legislation in eight Western European societies. The carefully selected countries—Britain, Denmark, France, Italy, Germany, the Netherlands, Sweden, and Switzerland—vary in labor market regulation as much as in labor relations. The comparison deliberately excludes both the late democratizing Southern countries and the post-communist transition countries of Central and Eastern Europe, as well as the non-European Anglophone liberal regimes in North America or ‘down under’. Thus, Britain is the only truly liberal case, while two Nordic corporatist and five Continental European countries span the cross-national variation to be explained.

Certainly, the topic of job security is highly relevant for labor market analyses and social policy reform efforts today. Since the neoliberal turn, political debates have evolved around deregulating labor markets in globally competitive market economies. More recently, the aftermath of the current post-crash crisis has further amplified economic pressures to mass-downsizing and political pressures to deregulate. The author embraces a comparative framework assertively embedded in the literature on labor relations, political power, and labor market developments. While the chosen topic focuses on a very particular aspect of labor market policies, that is, job security, the monograph provides a very informative overview by placing this in the context of changing labor relations in those eight countries over hundred years. Indeed, the book maps some 300 pages with the help of many detailed comparative tables, country-specific chronologies, and time-series graphs the history of job legislation within the wider political context. With this comparative historical study, Emmenegger further contributes to the current debate on the “dualization” of labor markets in Europe, which is no surprise given that he co-edited a recent volume on the topic (Emmenegger et al. 2012).

The comparative analysis covers established approaches from comparative welfare state regimes, political economy, and labor market analysis. From the introduction to the conclusion, the author uses the historical development as testing ground for his theory-oriented discussion of three competing theses: the “Varieties of Capitalism” perspective that focuses on employers’ strategy, proponents of the influence of Catholic social tradition (or Christian Democracy), and the power resource thesis stressing the role of organized labor. The author shows convincingly that all three approaches have considerable difficulties in explaining cross-national diversity as well as accounting for the historical narratives of first the regulation and then deregulation of job security. In contrast to quantitative and “fuzzy set” cross-national analyses (including the author’s own journal articles and published dissertation, see Emmenegger 2009), the strength of this study is a thorough, largely qualitative comparison of historical case studies along three crucial periods of development. The in-depth, within-case process-tracing narratives inform his cross-case comparative assessments of the conditions conducive to particular trajectories.

The book is organized in six chapters. The introduction and theory-focused second chapter set the stage, presenting the main focus, motivation, analytical framework, and methodological choices. The main empirical parts, chapters 3 to 5, are organized along major periods: the origins and early development of labor regulation, the expansion of worker-friendly job regulation during the post-war “red wave” of labor mobilization, and the neoliberal turn of employer-friendly deregulation during the “age of dualization.” These three periods are thus defined by “critical junctures” in the power relations between organised labor and capital. At least for some time following the two world wars and the late 1960s strike wave, power relations changed significantly, and this had profound effects on job regulation until the oil shocks of the 1970s led to a neoliberal reversal. These chapters do not only serve to parcel the narrative, but each juncture allows the author period-specific tests of the three sets of possible explanations. Finally, the conclusion is both a summary and a kind of post-crash postscript, discussing the current lack of serious deregulation attempts, except in Italy. Given that the other crisis-ridden countries in Europe have been excluded from the study, it might be seen from hindsight quite a pity that Spain, Portugal, and Greece, as well as Ireland, were not used as contrasting cases. They could have shown the consequences of late development and post-crash crisis on rather specific forms of labor market dualization to the detriment of women, the young, and the uneducated.

Although the study covers wide comparative and historical territory for analyzing the changing labor relations and their impact on labor market regulation, the author focuses in respect to the dependent variable on two important aspects of job security: the rules concerning individual firing and collective dismissal (job security strictu sensu), as well as the (de)regulation of temporary work that partly exempts jobs from the former rules. Building upon the dualization thesis developed elsewhere (Emmenegger et al. 2012), the author analyses the “two tier” labor market regulation for the core-workforce, vis-à-vis the more precariously (un)employed. This insider/outsider-perspective is of particular relevance for understanding the recent deregulation and post-crash crisis period. Indeed, the author does not see many reasons to expect that dualization will give way to a more general erosion of employment rights for the core in the decades to come. Moreover, even the outsiders are in favor of job protection, be it that they are living in a household with an insider or hope to become one.

Given the theory-testing goal, the author finds that none of the three approaches is capable of accounting for the comparative and historical patterns. Instead, he develops his own more sophisticated (“nuanced”) explanation that extends the power resource approach. In particular, Emmenegger focuses on the role of trade unions in defending job security for reasons of their members’ interest (individual job security), but also organization interests (union control of dismissals). This is by and large a reasonable explanation, yet it may not be new, as the author admits. Indeed, this explanation seems to resonate with some of the earlier neo-corporatist analyses that used membership and representation logics to explain the changing power relations and public policy influence. Thus, it may be less of a surprise that the author’s focus on job regulation instead of broader labor market policies has led to his emphasis on power resources: the control of individual and collective dismissal is largely driven by the interests and power of trade unions, vis-à-vis employers and the state.

The strength of the study, its focus on job security, allows the author to provide a very comprehensive treatment of this salient labor market issue, but it also entails a weakness: it focuses only on one particular labor market policy. The interaction with unemployment benefits and active labor market policies remains, therefore, largely unexplored. In the Italian case, the lack of functioning unemployment benefits will make any deregulation of job regulation more threatening, while in the Danish case, the flexible labor market goes together with rather generous long-term unemployment benefits. Thus job security and social protection hang together, as some of the “Varieties of Capitalism” scholars have claimed. The issue of outsiders cannot only be seen through the lens of lacking job regulation for atypical employment contracts; it also finds its mirror image in the workfare-oriented activation policies that sanction these outsiders as long-term unemployed. Thus, The Power to Dismiss maybe read together with complementary comparative studies of unemployment protection (e.g. Clasen and Clegg 2011). Hopefully, others will use this comprehensive study on job security as a model for exploring the possible interactions with other social and labor market policy features. Such broader comparisons might help exploring to what degree Emmenegger’s description of the historical waves and cross-national patterns were unique to the regulation and deregulation of job security. This comprehensive study shows that it definitively has been and will remain a topic of crucial importance to employers and trade unions alike.

Reviewed by Bernhard Ebbinghaus, University of Mannheim

The Power to Dismiss: Trade Unions and the Regulation of Job Security in Western Europe
by Patrick Emmenegger
Oxford University Press
Hardback / 368 pages / 2014
ISBN: 978-0-19-870923-7

 

References:

Clasen, Jochen and Daniel Clegg, eds. Regulating the Risk of Unemployment: National Adaptations to Post-Industrial Labour Markets in Europe. Oxford: Oxford University Press, 2011.

Emmenegger, Patrick, Silja Häusermann, Bruno Palier, and Martin Seeleib-Kaiser, eds. The Age of Dualization: The Changing Face of Inequality in Deindustrializing Societies. New York, NY: Oxford University Press, 2012.

Emmenegger, Patrick. Regulatory Social Policy. The Politics of Job Security Regulations. Bern: Haupt, 2009.

 

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