Harvard University Press Chapter Title: [PART III Introduction] Book Title: The Fissured Workplace Book Author(s): DAVID WEIL Published by: Harvard University Press. (2014) Stable URL: http://www.jstor.org/stable/j.ctt6wppdw.12 JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact [email protected]. Your use of the JSTOR archive indicates your acceptance of the Terms & Conditions of Use, available at http://about.jstor.org/terms Harvard University Press is collaborating with JSTOR to digitize, preserve and extend access to The Fissured Workplace This content downloaded from 132.236.235.231 on Fri, 11 May 2018 21:55:31 UTC All use subject to http://about.jstor.org/terms part iii Mending the Fissured Workplace d Th e labor economist and policy reformer John R. Commons described an eff ort to mend a fi ssured workplace more than a century ago. In the year the City of New York was building its fi rst subway along Fourth Avenue. Th e contract for construction and operation was made with a syndicate of bankers headed by August Belmont and Company of New York and including the House of Rothschild. About , Italian subway workers went out on strike, demanding that they should be paid directly “at the offi ce” of the syndicate and not indirectly through the labor contractors. Th ey did not ask for an increase in their wages of $. for ten hours. Th ey asked only for the elimination of the padroni. Th is demand, if acceded to, would have increased their actual wages considerably by eliminating the extortions of the padroni. As with many of the cases discussed in Part II, subway construction was being done through a network of subcontractors— in this instance coordi- nated through small players who acted as agents between the syndicate of investors who fi nanced the subway and the individual workers on the job site. By ceding the authority to hire and pay workers to the “padroni,” the syndi- cate removed itself from the direct employment relationship. Th e resulting arrangement left the day-to- day problem of recruitment of unskilled laborers to padroni, resulting in a fractured and highly competitive market for those laborers, with ample opportunities for middlemen to use their gatekeeper status to take a slice of the pie and still, presumably, provide the Belmont and This content downloaded from 132.236.235.231 on Fri, 11 May 2018 21:55:31 UTC All use subject to http://about.jstor.org/terms mending the fissured workplace Company syndicate with a lower-wage workforce than if it directly hired the laborers. Rather than using their collective eff orts to improve wages, the subway workers sought to aff ect the manner in which wage setting occurred in their labor market and, in turn, the trajectory of their wages and working condi- tions in the longer term. Cutting out the players in the middle would change the basic dynamic of the labor market and potentially give the workers greater ability to set standards and conditions collectively and directly with the party that set the larger conditions in the subway project. Presuming that the sub- way workers stayed or ga nized (they did not), the eff ort to shift the focus of discussions to the top of the business structure could have provided the basis for improving conditions for the workforce. Th e fi ssured workplace refl ects competitive responses to the realities of modern capital and product markets. Th e boundaries of fi rms have been re- drawn as a result of new technology and the falling costs of information. As detailed in Part II, the consequences of the fi ssured workplace are profound. Wage determination changes dramatically, often to the detriment of workers whose work has been shifted outward. Blurring lines of responsibility in- crease the risks for bad health and safety outcomes. And the pressure to cut corners and not comply with basic labor standards intensifi es. A public policy agenda must look for ways to address these problems. How- ever, crafting responses for the fi ssured workplace presents its own dilemmas, for a simple reason: federal and state policies are based on a model of employ- ment with a single, well- defi ned employer with direct responsibility in hir- ing and fi ring, managing, training, compensation, and development of its workforce. But that does not conform to the way the workplace is currently or ga nized. Part III addresses the question of mending the fi ssured workplace. Th e emergence of fi ssuring requires rethinking our basic defi nitions of employ- ment. It also requires diff erent approaches to how government agencies, labor unions and other worker advocates, and employer associations address its re- percussions. An economy dominated by large business organizations with concentrations of employees operating within their boundaries is diffi cult to police. An economy where much of that employment— particularly of work- ers with low skills and little market leverage— has been shifted outside of the traditional boundaries of the business or ga ni za tion poses even graver ques- This content downloaded from 132.236.235.231 on Fri, 11 May 2018 21:55:31 UTC All use subject to http://about.jstor.org/terms mending the fissured workplace tions about the effi cacy of the traditional approach to workplace regulation. Mending the fi ssured workplace requires mending the way we regulate work. Chapter focuses on policies that address the overall set of forces arising from fi ssured employment, particularly the question of responsibility as framed by current and prospective laws and recent court opinions that hint at new approaches to better aligning private and social responsibilities. Chapter explores how new approaches to enforcement of existing workplace laws might better redress the problems of fi ssuring, drawing on the recent experi- ence of several agencies in strategic enforcement. Chapter looks at other key players that might undertake a diff erent role given the fi ssured workplace: labor unions, worker advocates, employers and their associations, interna- tional monitors, and workers themselves. Once again, it refl ects on several contemporary innovative eff orts. Chapter examines the impact of further spreading of fi ssured workplaces on the economy as a whole. It examines their increasing presence in industries and occupations with high skill and educa- tion demands, like journalism and law, and then speculates on its implications for income distribution and the macroeconomy. Chapter pulls together the themes of the book to ask the question of where to go from here. e This content downloaded from 132.236.235.231 on Fri, 11 May 2018 21:55:31 UTC All use subject to http://about.jstor.org/terms This content downloaded from 132.236.235.231 on Fri, 11 May 2018 21:55:31 UTC All use subject to http://about.jstor.org/terms Harvard University Press Chapter Title: Rethinking Responsibility Book Title: The Fissured Workplace Book Author(s): DAVID WEIL Published by: Harvard University Press. (2014) Stable URL: http://www.jstor.org/stable/j.ctt6wppdw.13 JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact [email protected]. Your use of the JSTOR archive indicates your acceptance of the Terms & Conditions of Use, available at http://about.jstor.org/terms Harvard University Press is collaborating with JSTOR to digitize, preserve and extend access to The Fissured Workplace This content downloaded from 132.236.235.231 on Fri, 11 May 2018 21:55:44 UTC All use subject to http://about.jstor.org/terms 8 Rethinking Responsibility The modern employment relationship bears little resemblance to that as- sumed in our core workplace regulations. Improving conditions where the most vulnerable people in the economy work requires navigating the compli- cated, fi ssured environment laid out in this book. Some aspects of the fi s- sured world have desirable aspects— consumers benefi t when companies try to market goods and ser vices that conform to their tastes, and there are pro- ductivity gains from many aspects of fi rms focusing on core competencies. Many of the cases in previous chapters illustrate the painstaking systems that lead companies put in place to ensure that suppliers, contractors, and fran- chisees do not undermine core competencies and the basis of profi tability. While deftly crafting franchise manuals, delivery standards and systems, and monitoring arrangements, these lead companies often profess a lack of knowledge about the work conditions that fl ow from the very same stan- dards. Or they absent themselves from some coordination functions that might compromise their arm’s-length status. And the social consequences of these actions are signifi cant with respect to compliance with labor standards, im- pacts on worker health and safety, and more generally the distribution of in- come overall. Th is raises a fundamental public policy question: Should lead companies be allowed to have it both ways? Th is chapter starts with two illustrations of the poor fi t between existing laws and the fi ssured workplace. First, it discusses the diffi culty of defi ning “employer” and “employee” under federal statutes given fi ssured workplace realities. Second, it explores how liability considerations under the common law exacerbate the problem of coordination arising in the fi ssured workplace.