As global competitiveness and labour market flexibility continue to be dominant features of government policy, new forms and arrangements of precarious employment continue to emerge. This dynamic has led to greater complexity in employment relationships affecting persons born in Canada, permanent residents and “new” citizens and migrant workers which existing labour market policy and regulation are not yet prepared to address. It is clear that precarious employment gives less protection against unpaid wages and poorer working conditions, for example, but there are a variety of perspectives on what reforms are necessary to address these problems, and there are a variety of evaluative criteria upon which we may judge those proposed reforms.
This section reviews policy and legislative responses to the impact of precarious work on workers that have been proposed by others, but are not LCO recommendations at this stage (and may not be recommendations).
A. Policy Considerations
1. Establishing Evaluative Criteria
There are a myriad of potential regulatory responses to the problem of precarious employment. An initial task in moving forward is to generate a set of criteria by which we may evaluate various options. The LCO seeks feedback specifically as to what these evaluative criteria should be. For example, we might look to stated policy objectives of the provincial government such as the Ontario Government’s Poverty Reduction Strategy. Alternatively, or in addition, we could look to the goal of “flexibility” as expressed by members of the business community or the desire of employees collectively or individually. Finally, criteria could be generated by drawing on outside sources, such as the international conception of “decent work” as articulated by the International Labour Organization.
The internationally-recognized norm of decent work may assist in efforts to construct evaluative criteria. In the federal employment context the “decency principle” has been stated as follows:
Labour standards should ensure that no matter how limited his or her bargaining power, no worker … is offered, accepts or works under conditions that Canadians would not regard as ‘decent’. No worker should therefore receive a wage that is insufficient to live on; be deprived of the payment of wages or benefits to which they are entitled; be subject to coercion, discrimination, indignity or unwarranted danger in the workplace; or be required to work so many hours that he or she is effectively denied a personal or civic life.
The concept of decent work takes a positive approach to employment, in that it sets out desired characteristics, whereas the concept of precarious employment, at least in this respect, can be termed a negative approach.
2. Ontario Government Policy: Poverty Reduction
There is a longstanding association between legal regulation of employment and poverty reduction initiatives in Ontario, including the Poverty Reduction Strategy, launched in December 2008. In May 2009, the Poverty Reduction Act, 2009, received Royal Assent. “The Government’s poverty reduction strategy”, according to the Act’s preamble, “is guided by the vision of a province where every person has the opportunity to achieve his or her full potential, and contribute to and participate in a prosperous and healthy Ontario”. The Act “[r]ecogniz[es] that the reduction of poverty supports the social, economic and cultural development of Ontario”. A central feature of the provincial strategy is an acknowledgement of “the heightened risk among groups such as immigrants, women, single mothers, people with disabilities, aboriginal peoples and racialized groups”. Poverty reduction was a key public policy objective behind the legislation to extend statutory protections to low-income temporary help agency workers passed in May 2009.
3. Need for Flexibility
The proliferation of precarious employment in Canada and elsewhere sometimes is regarded as a product of market forces which impose demands on employers for, most notably, flexibility in human resource allocation. From this perspective, flexibility is used to characterize the perceived human resource needs of employers during contemporary economic restructuring. The emphasis here is on how labour flexibility facilitates competitiveness in hyper-competitive globalized markets of goods, services and labour.
Labour flexibility may also help people who do not want full-time or permanent employment. For example, part-time and self-employment is sometimes regarded as a choice made by employed women to facilitate a better work/life balance, by assisting with the fulfillment of household responsibilities such as childcare. Labour flexibility has developed in response to the desire to exercise greater independence in the performance of paid work, or to juggle household and job responsibilities. While this may be a real choice for some women, others may feel compelled to limit their workplace involvement in order to satisfy their domestic responsibilities, particularly when their children are young, perhaps because of the lack of alternate childcare options or a parental helpmate.
Those who see part time work as the employee’s choice tend to view concern for the impact of labour flexibility as overstated; they are concerned that policy intervention may conflict with labour market strategies to enhance the economic prospects of firms. The fear is that regulatory adjustments will be stifling, to economic and employment growth, and to adaptability of firms and workers within the labour market.
From a contrasting perspective, labour flexibility is regarded as largely beneficial to employers, not employees. Although diverse forms of ﬂexible labour exist, some of which are beneficial to individual workers, most of these arose primarily to fullﬁl the needs of employers. Proponents of this view point to intensifying pressures and incentives to either overwork or underwork. Moreover, they note a strong shift in the allocation of risks within the labour market. The costs, liabilities and overall risks within the employment relationship have shifted more considerably onto workers and especially onto those who least can afford it.
Labour flexibility may be described more aptly as a question not about whether or not to regulate labour markets. Even the most flexible labour markets require legal rules. Rather, the fundamental issue is what form of legal regulation best suits broader public policy objectives. In recognizing the importance of both employer and employee flexibility and employee security, Arthurs set out the provisions need for what he calls “flexicurity”: “contributions from the employer, from social insurance programs…and from public or employer-funded programs designed to prepare workers for new jobs”.
B. Specific Policy Proposals to Address Precarious Employment
Once a set of evaluative criteria are selected, and policy imperatives identified, they may be applied to the proposed policy reforms. In this section, the Paper outlines specific proposals that have been raised in the literature and by experts and advocates in the area to address precarious employment. Because of the wide range of existing proposals, only a modest selection of proposed reforms is reviewed here. They are meant to illustrate options that have been proposed by various commentators and are not to be taken as LCO recommendations.
Legal proposals intended to address precarious employment tend to fall into three categories, contractual, statutory and collective representation, which correspond to the legal regimes of employment. These categories are used as an organizing tool to facilitate reflection and not to foreclose the potential of an integrated or multi-pronged approach. The problems presented by precarious employment are not limited to any one category.
Although categories of this nature have the potential to reinforce orthodox thinking about the employment law-labour law distinction discussed above, what is needed is a policy agenda which can transcend those discrete boundaries or limitations. In this respect, these categories of proposals are not exclusive of each other. The task is one of constructing a comprehensive set of recommendations designed to ameliorate the characteristics and ramifications of precarious work and thus improve the lives of vulnerable workers.
What is ultimately needed are policies and actions which, in assessing legal proposals, not only contemplate intended consequences, but just as importantly anticipate unintended consequences. The ability to be able to fall back on sound, well-articulated evaluative criteria will, in the end, facilitate the development of future policy responses to those unintended consequences.
1. Enhancement of Existing Protections
One option is to enhance existing standards or protections. The improvement of key employment standards has been suggested as a way to improve work-life balance and to account for unpaid labour within households. More specifically, vulnerable workers appear most at risk of violations of their rights to minimum wages, hours of work and other basic standards. The Ontario Employment Standards Amendment Act (Temporary Help Agencies), 2009 addresses some of the differential treatment in law between employees hired through temporary agencies and those through the client firm, although often engaged in work that is comparable if not the same. One area of confusion that has been eliminated since January 2009 has been the entitlement to holiday pay for temporary agency workers. The extension of statutory coverage will have a limited effect without effective enforcement mechanisms, however. Even if key employment standards are extended, it can be argued that serious concerns remain for certain precariously employed people. The multidimensional nature of precariousness detracts from efforts to selectively identify and narrow down key standards.
2. The Extension of Statutory Protection
A considerable number of academic commentators and worker advocates question whether the status quo in the employment relationship is sustainable for vulnerable employees. Among this group there is wide consensus that strengthening or universalizing statutory protections of employment can help to reduce insecurity within the labour market.
One way to extend statutory protections is to expand or broaden the definition of “employee” or “worker” in employment statutes. For instance, the definition of worker as set out in the OHSA, which takes a more inclusive approach than other statutes, such as the ESA, 2000, could be used to re-fashion the definitions in those other statutes, including own-account self-employment within those definitions.
A similar approach calls for the definition of employee or worker to be harmonized across the legal regimes. This, it is suggested, could conform with definitions established in other contexts such as under federal income tax law. Alternatively, employment statutes could be revised to include provisions allowing for determinations on the definition of employee in one context be made applicable in other contexts.
There is also a need to address the link between own account self-employment and subcontracting, described earlier. The existence of subcontractors creates a triangular employment relationship which raises the issue of the liability of employers. Proposals have been advanced to introduce statutory provisions covering joint liability of employers, especially subcontractors.
A strong argument can be made that the broadest possible coverage guarantees equal treatment in employment. For instance, the final report of the Quebec review on precarious employment accepts that statutory protections must be accessible to as many workers as possible. It also finds that, in public policy terms, disparity in treatment based on employment status is socially unacceptable. From this perspective, a principled starting point would be that all individuals performing paid work in Ontario are entitled to full coverage of all employment statutes regardless of the form or status that work takes. The fact that statutory protections provide a floor of rights for non-unionized and unionized workers alike, suggests that those statutes ought to apply broadly, if not universally, to guarantee that no employment falls below the minimum standards. Exceptions to this would need to satisfy a very high standard or threshold.
3. Increased Social Assistance Protections
Some advocates of corporate flexibility take the view that precarious employment stems from discrete as opposed to systemic market failures and thus, although it constitutes an undesirable labour market outcome, the most effective response is not through explicit regulatory or policy intervention that interferes with labour flexibility. Rather, this view suggests, a more appropriate regulatory response would be to grant employers considerable flexibility in hiring and dismissing employees and at the same time to provide all employees with broad social assistance protections. A prominent example of this kind of social assistance is “insecurity pay”, also known as “precarity pay”, described as a premium paid to temporary workers in recognition of the insecurity of precarious employment. (“Precarity” is the term used in some countries to refer to the conditions of vulnerable workers.) One example is the payment of end-of-contract bonuses or precarity pay of 10% of the remuneration earned during the contract for temporary workers in France who are not offered a permanent position. This would be most useful for older workers, workers with wages that fall below a living wage, workers who did not choose their employment situation, workers in non-unionized work environments, and workers not covered by group or private insurance and not contributing to an RRSP. A guaranteed income would be another option.
C. Enforcement of Employment Statutes
A discussion of legal approaches to the mitigation of precarious employment cannot occur independently of the issues of enforcement and compliance. From the perspective of employers, the existence of stronger and more effective enforcement mechanisms counters unfair competition. All employers benefit through a levelling of the playing field.