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The fissured workplace: Implications for Closing the Gaps

CSTE Occupational Health Surveillance Subcommittee Meeting

Washington, DC: April 18, 2013 David Weil

Boston University

Four goals for Closing the Gaps affected by the fissured workplace

To identify the industries and occupations where

intervention is most needed; To identify new or emerging hazards (new hazards; old

hazards in new settings); To identify individual workplaces (departments within

workplaces) where intervention is warranted; To identify potential, previously undocumented risk

factors (e.g. inadequate supervision) that require further etiological research.

Source: CSTE Closing the Gaps meeting, April 2009. 2 David Weil, Boston University

Fissured formula

Provider of management

service

Third party management co.

Brand management co.

Provider of cleaning service

Franchisees L/S business Subcontractor Labor contractor

Provider of landscaping

service

Multiple parties / multi-levels

FISSURED RECIPE: Focus on core competencies Brand / Coordination / Cost

Shed employment to lower level providers in competitive markets

Develop standards & create structure to protect core

RESULTS FOR LEAD FIRMS: Capture rents from revenue side Lead firms face a schedule of prices for services rather than wages for labor

Reduce costs but creates agency dilemmas

3 David Weil, Boston University

Consequences of fissured employment RESULTS FOR SUBSIDIARY ORGS: More competitive markets and price for services Labor a significant share of costs Downward pressure on labor costs and conditions

4

SOCIAL CONSEQUENCES: Externalities: Increased costs from

coordination problems Compliance: Increased incentives for violating standards

Income distribution: Impact of taking shifting wage setting

25.7%

22.3%

12.7%

18.2%

23.5%

12.4%

83.4%

62.6%

70.5%

67.7%

65.0%

73.6%

62.7%

70.0%

72.2%

74.2%

75.2%

87.5%

0.0% 50.0% 100.0%

Retail and drug store

Security, bldg., grounds

Residential construction

Restaurant and hotels

Grocery stores

Home health care

Off the Clock Overtime Minimum wage

Source: Bernhardt et al. 2009

Non-compliance with workplace

standards

David Weil, Boston University

From iPhone to advanced subcontracting: Fissured cell towers

5 David Weil, Boston University

Fissured supply chains: Schematic of WalMarts nerve center

6

Incoming dock Outgoing dock Conveyer system

Intl. Shipments

Individual stores

Information

Products (shipments)

David Weil, Boston University

Schematic of employment

Incoming dock Outgoing dock Conveyer system

Intl. Shipments

Individual stores

Premier Warehousing Ventures

Schneider Logistics Impact Logistics Inc.

When widespread violations were found, who is the

employer?

7 David Weil, Boston University

Franchising as a fissured form: Fast food

8

4 2 6 3 5 1

Franchisee (Single-unit)

Franchisee (Multi-unit)

David Weil, Boston University

Fissuring and complianceTop 20 branded fast foods

9 David Weil, Boston University

Industry Lead firm / organization Lower level entity Eating and drinking Limited service (fast food) Full service

Brands (franchisors) Franchisees / outlets

Hotel and motel Brands (franchisors) Brand / independent operators

Hotel / motel properties; Contractors; Labor brokers

Residential construction Major homebuilders Contractors / subcontractors

Janitorial services Building service providers / Franchisors

Contractors / franchisees

Moving companies / logistics providers

Branded national moving companies

Subcontracted local movers; interstate trucking companies; warehouses

Telecommunications Media and telecomm companies (e.g. Time Warner; Verizon)

Contracted installation providers and services

Retail food stores (prepared foods)

Major food retailers Franchised prepared food providers

Home health care services Major purchasers of home health care services

Franchised home health care providers

Fissured employment in assorted industries

10 David Weil, Boston University

Key questions on injury and illness surveillance How are injuries / illnesses currently recorded in fissured

workplaces in different industries? Whose log(s)reflect workplace incidents?

How does fissured work contribute to injuries and illnesses, arising from coordination problems (cell); shifting liability (petrochemical); training (construction)?

How do injuries / illnesses vary across different fissured structures?

How should injuries / illnesses be recorded given the joint / multi-party nature of employment and responsibility?

11 (c) David Weil, Boston University

Policy responses

David Weil, Boston University 12

Rebalancing the fissured workplace: Strategic enforcement

13

Policies to rebalance the fissuring decision:

Refocus enforcement to the top of fissured structures

Transparency and connecting the dots

Rethink enforcement procedures on the ground (deterrence / worst offenders)

Engage workplace advocates

Core competency

Shifting out work

David Weil, Boston University

Advanced subcontracting: Focusing at the top

Traditional approach

Mended approach

14 David Weil, Boston University

Examples of policies / opportunities

Hot-goods authority (WHD) Food industryfresh produce

Enterprise-wide agreements (WHD / OSHA) Monroe Muffler / National Roofing Hotel initiative

Multi-employer citation policy (OSHA) Summit Contractors decision

Misclassification initiatives (Federal and state) State / federal collaboration

Transparency / connecting the dots (WHD / OSHA) Eat / Shop / Sleep

15 David Weil, Boston University

Rebalancing the fissured workplace: Public policies

16

Public policies to rebalance the fissuring decision:

Redefining employer in

workplace laws

Misclassification and egregious fissuring

Broaden notions of liability

Expand transparency requirements

Core competency

Shifting out work

David Weil, Boston University

The fissured workplace: Implications for Closing the GapsCSTE Occupational Health Surveillance Subcommittee Meeting Washington, DC: April 18, 2013Four goals for Closing the Gaps affected by the fissured workplaceFissured formulaConsequences of fissured employmentFrom iPhone to advanced subcontracting: Fissured cell towersFissured supply chains: Schematic of WalMarts nerve centerSchematic of employmentSlide Number 8Fissuring and complianceTop 20 branded fast foods Fissured employment in assorted industriesKey questions on injury and illness surveillance Policy responsesRebalancing the fissured workplace: Strategic enforcement Advanced subcontracting: Focusing at the topExamples of policies / opportunitiesRebalancing the fissured workplace: Public policies