Fragmentation of Labour Processes

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Fragmentation? The future of work in Europe in a
global economy Roma, 8 9 October 2008
Fragmentation of Labour Processes
Value chain restructuring, work and employment
Jörg Flecker FORBA, Vienna
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Debates on Fragmentation some research issues

• Labour Process Theory
• Labour Market Segmentation
• Industrial Relations
• Network Society

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Debates on Fragmentation some policy issues

• more and better jobs
• Flexicurity
• Low wage employment
• Precarious employment and living conditions

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Global Value Chains and Networks

• Sequential transformation of goods and services
  ? vertical or chain perspective
• Horizontal relations within different layers ?
  network perspective
• Power relations, control, focal firm ?
  governance perspective
• Upgrading, downgrading, restructuring ?
  dynamic perspective
• ...and work and employment?

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Citylife Customer Service (Schönauer 2007)
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Domainsoft / Information Technology(Makó,
Illésy, Csismadia 2007)
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Citycouncil / Local Government(Dahlmann 2007)
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Subsidiary of National Post (Gavroglou 2007)
Employees by employment contract 15
management 98 workers under National Post
collective agreement 120 workers under
subsidiary company collective agreement 80
seasonal workers national minimum wage 250 -
300 temporary agency workers
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Dimensions of Fragmentation

different same
different Outsourcing Relocation
same Work on clients premises Internal segmentation
Employer


Geographic and Organisational Place
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Fragmentation of work

• Externalisation ? changes in work organisation
  (standardisation and formalisation)
• Commercialisation service-driven ? cost and
  profit-driven
• Working across organisational boundaries
  uncertainties, cooperationcompetitionconflict
• Contracts between organisations, service level
  agreements ? impacts on work
• Boundary spanning roles transaction work

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Fragmentation of employment

• Differentials between companies, sectors and
  countries drivers of outsourcing and relocation
• Costs and risks are passed on to suppliers,
  subcontractors, service providers, agency workers
  ...
• ... but externalisation no longer cushions core
  workers
• Fragmented workforces within organisations
• Same pay for same work at the same place?
  growing inequality and limits to equal
  opportunity policies

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Limitations and counter tendencies

• Workers resistance and negotiations
• Coordination and communication problems,
  acceleration of business processes
• Some insourcing to gain control and secure
  quality
• Harmonisation of terms and conditions within
  service provider companies

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Example Clothing Industry

• Big employment differentials between companies,
  regions and countries
• Buyer- and retail-driven value chains, shifting
  of risks to suppliers
• Standardisation and Taylorist work practices
  downstream the value chain
• Overall acceleration of business processes,
  growing demands for flexibility along the chain

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Example IT Services

• Transfer of personnel from public organisation to
  private company, important role of trade unions
• Differences in forms of employment regulations,
  not so much in social levels
• Working on site and partly fragmented conditions
  in the service provider company
• Increase in standardization (use of templates,
  platforms)
• Partly balanced but generally contested power
  relations between organisations, contracts impact
  on work

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Example Customer Service

• Big differences in terms and conditions between
  public organisation and private service provider
• Externalisation to circumvent employment
  regulations
• Service providers use flexible labour actions
  taken against this in some cases
• Service level agreements directly impact on
  working conditions (standardisation,
  surveillance)

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Conclusions 1/2

• Fragmentation of labour processes and lengthening
  of value chains in services and in public sector
• Tendency towards fragmentation of employment
  within and between organisations but
• marked differences between sectors and
  countries
• Quality of worklife depends on position within
  value chain
• yet position is not static but highly contested

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Conclusions 2/2

• Cushioning core workers or keeping them in check?
  
• Peripheral workforce of one firm is the core
  workforce of another
• but only some attempts at harmonising terms and
  conditions and seizing opportunities of an
  internal labour market
• Increasing inequalities fragmentation plus
  asymmetries between organisations
• Growing opportunities to compete on labour costs,
  less pressures for high road strategies or
  combination of high road and low labour
  standards

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Thank you!
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Effects on Work and Employment

• Decomposition and recomposition of sectors,
  companies, workplaces and jobs
• Differentials in terms of basic employment
  conditions
• Deregulation and decentralisation of bargaining
• Restructuring ? bargaining position of labour
• External flexibility of core firms ? flexible
  labour at supplier or service provider companies

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Work Organisation and Restructuring in the
Knowledge Society (WORKS)
Restructuring