International Journal of Manpower
ISSN 0143-7720 Volume 23 Number 3 2002
Equality in employment: issues and policies Guest Editor Harish Jain Paper format International Journal of Manpower includes eight issues in traditional paper format. The contents of this issue are detailed below.
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Access to International Journal of Manpower online 182 Editorial advisory board ___________________________ 183 Abstracts and keywords ___________________________ 184 Guest editorial ____________________________________ 186 To what extent are ethnic minorities in Britain over-educated? H. Battu and P.J. Sloane__________________________________________
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Australian immigration: the triumph of economics over prejudice? Julian Teicher, Chandra Shah and Gerard Griffin _____________________
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Employment equity in South Africa: lessons from the global school Ade`le Thomas __________________________________________________
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Canada’s employment equity legislation and policy, 1987-2000: the gap between policy and practice Carol Agocs____________________________________________________
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Women in trade unions in India C.S. Venkata Ratnam and Harish C. Jain ____________________________
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Book reviews______________________________________ 293 About the authors _________________________________ 305
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EDITORIAL ADVISORY BOARD Professor David J. Bartholomew London School of Economics, UK Professor Derek Bosworth Manchester School of Management, UMIST, UK Professor Martin Carnoy School of Education, Stanford University, USA Professor Peter Dawkins Melbourne Institute for Applied Economic and Social Research, Melbourne University, Australia
Professor Lord Richard Layard Centre for Economic Performance, London School of Economics, UK Professor John Mangan University of Queensland, Brisbane, Australia Professor Stephen L. Mangum Ohio State University, Ohio, USA
Professor John Fyfe W.S. Atkins plc, Epsom, UK
Professor Barrie Pettman International Management Centres, UK, and Founding Editor of International Journal of Manpower
Professor Morley Gunderson University of Toronto, Canada
Professor Abraham (Rami) Sagie Bar-Ilan University, Israel
Professor Thomas J. Hyclak Lehigh University, Bethlehem, USA
Professor David Sapsford Management School, Lancaster University, UK
Professor Susan E. Jackson Rutgers University, New Jersey, USA
Professor P.J. Sloane University of Aberdeen, Aberdeen, Scotland Professor Klaus F. Zimmerman Department of Economics, University of Bonn, Germany
Professor Harish C. Jain McMaster University, Canada Professor Geraint Johnes Management School, Lancaster University, UK
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International Journal of Manpower, Vol. 23 No. 3, 2002, Abstracts and keywords. # MCB UP Limited, 0143-7720
To what extent are ethnic minorities in Britain over-educated? H. Battu and P.J. Sloane Keywords Education, Ethnic groups, Minorities, United Kingdom, Labour market For the total population there is evidence of substantial over-education in the sense that workers possess higher qualifications than are strictly required for the job. Using the fourth wave of the British National Survey of Ethnic Minorities, this paper attempts to ascertain whether ethnic minorities suffer from higher over-education than whites due to possible discrimination. The results suggest a differential effect across various ethnic groups and a tendency for foreign qualifications to be rewarded less.
Australian immigration: the triumph of economics over prejudice? Julian Teicher, Chandra Shah and Gerard Griffin Keywords Immigrants, Labour market, Multi-cultural society, Australia This paper provides an account of Australian immigration in the late twentieth century focusing on labour market and industrial relations issues. The paper chronicles the changing immigration policy framework, from one premised on exclusion to one designed primarily to serve the needs of the domestic labour market. One of the consequences of the policies, more by default than design, has been the transformation of society from a monocultural to a multicultural one. In spite of this migrants from other than mainly English speaking (MES) countries often have poor labour market outcomes, sometimes well after the time of arrival. This group appears to be more adversely affected by the downturn in economic cycles than other migrants or the Australian-born population. At the industrial relations level trade unions have made a pragmatic, as well as a principled, shift to embrace immigrant workers from non-MES countries. However the transition from a centralized system of conciliation and arbitration to a more deregulated labour market has compounded the disadvantage suffered by these workers.
Employment equity in South Africa: lessons from the global school Ade`le Thomas Keywords South Africa, Employment law, Affrimative action, Equal opportunities South African companies employing 50 or more employees or those with a specified financial turnover, are required to comply with the provisions of the newly introduced Employment Equity Act. Prior to the introduction of the Act, large companies in the country had already introduced strategies of affirmative action to achieve employment equity. This paper highlights some of the strategic and operational concerns surrounding employment equity legislation in South Africa and reviews broad practices of employment equity in Malaysia, India, the USA, Canada, Britain and Zimbabwe. Lessons for the effective implementation of employment equity in South Africa are identified. Canada’s employment equity legislation and policy, 1987-2000: the gap between policy and practice Carol Agocs Keywords Employment law, Organizational behaviour, Discrimination, Employment, Canada Over the past 16 years, a legislative and policy framework has evolved in Canada to a d d r e s s s y s t em i c d i s c r i m i n a t i o n i n employment in the federal jurisdiction, and in organizations that sell goods or services to the federal government. Data collected pursuant to the Employment Equity Act, as well as published literature and government documents, are reviewed in order to provide a critical analysis of the federal policy framework as set out in 1987 and revised in 1996. This review is the basis for assessing both progress and lack of improvement in the employment status of racial minority, aboriginal, and disabled women and men, as well as white women, within the federal sector. Reasons for limited results are proposed, and issues posed by contemporary labour market trends are identified. It is argued that the results of employment equity policy are disappointing because the policy is not being implemented by employers
and effectively enforced so that there are consequences for employers’ failures to comply. In other words, there is a persisting gap between employment equity policy and practice. This gap presents difficulties in evaluating the content of employment equity policy, since it is not possible to evaluate a policy that is not implemented. Women in trade unions in India C.S. Venkata Ratnam and Harish C. Jain Keywords India, Trade unions, Labour market, Women, Employee rights This paper on women in labour unions in India highlights the occupational segregation suffered by women in union structures. The authors explore and document the extent of female participation in trade unions in India. They suggest that less than 8 per cent of the 380 million workforce in India are unionized and women account for a very small fraction of trade union membership. They provide a number of reasons for the low female
membership and participation in unions. In the occupations where women are organized, the incidence of union leadership among women varies considerably. On the positive side, the authors note that India has been a pioneer in organizing women in the informal sector such as workers’ cooperatives, self help groups such as Working Women’s Forum and Self Employed Women’s Association etc. In fact, they find that these unions are creating social unionism, thereby rewriting the meaning of trade unionism. The focus is on broad objectives of empowerment, development and fighting for their rights rather than the business unionism in North America (that is, focus on the bread and butter issues alone). The initiatives dictated by the Indian Constitution such as reservations or quotas for scheduled castes and scheduled tribes may have to be applied to labour unions and the private sector employers in the case of women in India. Policy makers and managers can learn a great deal from the theories discussed above.
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Guest editorial About the Guest Editor Harish C. Jain is a Professor of Human Resources and Labour Relations and Labour Relations in the Michael G. DeGroote School of Business at McMaster University in Canada. He has published extensively in the areas of employment equity in Canada and several other countries; multinationals and human resource management; police and racial minorities; and industrial relations. He has been a Consultant to the national government in South Africa, to the Organization for Economic Cooperation and Development (OECD) in France, federal and provincial government agencies and human rights commissions across Canada.
Theories of labour market discrimination and the status of disadvantaged groups The twenty-first century presents a number of challenges to national policy makers and organizations. Some of these challenges include globalization and world-wide competition. within this context, one such challenge is the extent to which equality of opportunity is made available to various disadvantaged groups such as women, racial groups, immigrants and others. Employment or labour market discrimination is an important aspect of equality of opportunity. Such discrimination is a multidimensional and complex phenomenon that is manifested in various social and economic interactions within a particular society in which it is found. There are many theories that attempt to explain the causes and effects of labour market discrimination such as economics as well as other disciplines including sociology and social psychology (Jain and Al-Waqfi, 2001). The main economic theories of employment discrimination include Becker’s taste theory, the statistical discrimination theory and the human capital theory. In addition there are at least two other theories including the theory of social capital and the theory of learned helplessness (Jain and Al-Waqfi, 2001). Becker (1957) argues that discrimination occurs as a result of prejudice or ‘‘taste for discrimination’’ on the part of the employer or his agents. According to this model, some employers would be willing to pay a premium in order to practice their ‘‘taste for discrimination’’ and avoid association with the disfavored groups. It follows that in a competitive market the discriminatory employers would be forced out of the market since they would operate at higher costs than those of non-discriminatory employers. Based on this argument, long-term explanations of persistence of discrimination have focused on some sort of market failure (Jain and Al-Waqfi, 2001). Employers can continue to discriminate only if they possess some market power that enables them to generate economic profits higher than those of a similar firm operating in a perfectly competitive market (Elmslie and Sedo, 1996). While Becker’s model has achieved significant importance in the literature employment discrimination, other economists including Arrow (1972; 1998), Phelps (1972), and Aigner and Cain (1977) have developed a model of discrimination that does not assume the employer is prejudiced or forgoes profits to indulge in his taste to discriminate. The theory of statistical
discrimination is an information-based theory. It is based on the notion that employers can never generally obtain all the information they wish to know about the long-term productivity of job candidates, and so they have an incentive to rely on group membership (such as race or gender) as a signal that allows them to improve their predictions of a candidate’s potential to perform. Suppose for example that blacks and whites differ on average in productivity due to some causes that are not observable (which could be due to quality of education or cultural differences or any other reasons). Then the experience of employers over time will cause them to use the observable characteristic, race, sex etc. as a surrogate for the unobservable characteristics which in fact cause the productivity differences (Arrow, 1998). If an employer perceives whites as more productive than members of nonwhite groups, then the employer will consistently hire and promote whites over equally qualified members of the other groups (Jain and Al-Waqfi, 2001). Both the taste theory and the statistical theory of discrimination have tried to explain employment discrimination by looking at the demand side of the labour market. The human capital approach, as well as the theories discussed in the next section, explain the persistence of labour market discrimination in terms of differences in the qualitative characteristics of the supply of labour between different groups of people. The basic proposition of the human capital theory is that the return on a unit of labour is determined by the investment embodied in this labour in terms of education and training (Becker, 1993). According to the proponents of the human capital approach to discrimination in employment, some members of disadvantaged groups lack the necessary ‘‘human capital’’ such as education, training and experience. Thus members of these groups may continue to be locked up in low-income and low-level jobs not only because of the structure of the labour market and the discriminatory treatment against them, but also because of the lower quality of their human capital (Jain and Al-Waqfi, 2001; Jain, 1982; Jain and Sloane, 1981). The human capital approach to employment discrimination against disadvantaged groups can be questioned on at least two grounds. First, in the selection process for various job opportunities, the assessment process has a large subjective component and the attributes of lower human capital levels are usually presumed (Work, 1984). Second, the process by which individuals acquire human capital and the opportunities available to them in this regard are largely affected by their position in a complex network of social connections and affiliations. This calls for extending the concept of human capital to the broader concept of social capital (Jain and Al-Waqfi, 2001). Many researchers have recently come up with alternative explanations for discrimination phenomenon that are not market based. Their explanations rely on social and psychological interactions and their effects in shaping the work and life opportunities available for members of disadvantaged groups (see Arrow, 1998; Loury, 1998; Elmslie and Sedo, 1996). The social capital theory is based on the notion that individuals are embedded in a complex network of social affiliations, which substantially affects their access to various resources.
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Loury (1977; 1987; 1998) introduced this concept and further suggested the extension of the human capital theory in order to provide a richer context within which to analyze group inequality. In this theory, one’s investment in productive skills depends on one’s position in the social structure. There is a strong theoretical support for the notion that social networks affect individual’s educational and professional achievements. The social distance theory agues that an individual’s concerns for status and conformity determine his/her educational and career aspirations and achievements. Research has shown that a very large fraction of jobs are filled by referrals by current employees (Arrow, 1998). Social segregation can give rise to labour market segregation through network referrals (Jain and Al-Waqfi, 2001). The social network theory is very important from a public policy point of view since it shows the inadequacy of approaching anti-discrimination efforts only within a market framework. There are significant market failures, having little to do with economic discrimination as conventionally understood, that play powerful role in perpetuating inequality. Preferences and investments in education and training by individuals are influenced by social and psychological externalities (Jain and Al-Waqfi, 2001). The theory of learned helplessness adds another dimension to the social and psychological aspects of discrimination. This theory is based on the notion that psychological externalities, resulting from the experience of discrimination affect the future behavior of individuals, especially those who are members of disadvantaged groups. Elmslie and Sedo (1996) indicate that ‘‘discrimination breeds helplessness, that is accompanied by decreased motivation and diminished ability.’’ As a result, an individual who is discriminated against in the labour market will tend to suffer psychological effects that impair his or her ability to seek future employment or to move up in current employment by having an effect on human capital characteristics. In such case, discrimination can become a ‘‘self-fulfilling prophecy’’. The feeling of helplessness is exacerbated by the fact that the individual realizes that he/she has no control on the event that is causing the discrimination ( such as the person’s gender or color of skin). Personal helplessness leads individuals to internalize failure resulting in self-esteem problems (Jain and Al-Waqfi, 2001). The five articles in this issue cover selected aspects of employment discrimination in Britain, Australia, South Africa, Canada and India. The paper by Buttu and Sloane analyzes discrimination against some racial minority groups in Britain due to excessive educational requirements. Teicher, Shah, and Griffin’s paper deals with discrimination against non-English speaking immigrants to Australia. The papers by Thomas and Agocs tackle the issues relating to employment equity in South Africa and Canada and the paper by Ratnam and Jain discuss the status of women in Indian trade unions. Battu and Sloane pose and answer a very interesting and poorly researched question: ‘‘To what extent are ethnic minorities in Britain overeducated?’’ As the authors suggest, the paper has for the first time, examined this question to find optimal matches in the labour market. They conclude that in the context of
the existence of employment discrimination against racial minorities, a higher proportion are overeducated relative to the white persons. However, the extent of overeducation varies across various non-white racial groups. For instance, they find that Indians, African-Asians and the Chinese levels of overeducation is in excess of 30 per cent compared to around 20 per cent for whites, while 36 per cent of Bangladeshi workers are undereducated relative to their jobs. They also find that ethnic concentration in one’s own community raises earnings; longer stay in UK is related to greater access to private transport as well as higher earnings for non-white groups; and lack of English language fluency has a significant and substantial negative effect on earnings. This paper illustrates several theories of discrimination, such as human and social capital theories. The paper by Teicher, Shah, and Griffin on ‘‘Australian immigration: the triumph of economics over prejudice?’’ discusses the role of immigration in Australia in the late twentieth century. It chronicles the changing immigration policy framework in Australia from exclusion of immigrants from mainly non-English speaking countries to one of acceptance based on the labour market needs of the Australian economy. This has resulted in the transformation of the country’s society from a mono-cultural to a multi-cultural society. The authors go on to discuss the extent and the impact of discrimination on immigrant workers, the changing labour union response to these immigrants and the impact of the 1996 Workplace Relations Act. The new legislation focused the industrial relations system firmly at the enterprise level as opposed to centralized bargaining and national arbitration system prior to the Act. The authors discuss the role of trade unions in attempting to embrace immigrant workers from non-English speaking countries (MES) countries. However, the transition in the Australian industrial relation system from a centralized system of conciliation and arbitration to a recent deregulated industrial relations system of enterprise bargaining has, as the authors suggest, ‘‘compounded the disadvantage suffered by these workers’’. For instance, the enterprise bargaining, according to the authors, has raised a number of concerns for these disadvantaged groups, such as high rates of unemployment, underemployment, vulnerability during restructuring and recession and over-representation in low-status occupations. The interaction of demand and supply side theories discussed above is very well illustrated by this paper. The paper by Thomas highlights the role of the employment equity legislation in South Africa which was passed by the Parliament in 1998 and came into effect over a two-year period. She discusses in brief, lessons from other countries such as Canada, India, Malaysia, and Zimbabwe, for South Africa in reducing discrimination against majority blacks and women and other designated groups in view of the legacy of discrimination and occupational segregation against these groups by the previous white regime. The paper by Agocs on Canada’s Employment Equity Legislation defines the concept of discrimination, provides an overview of the Canadian legislative
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environment, and evaluates the impact of employment equity legislation at the federal level (impacting on banks, inter-provincial transportation, inter-provincial communication industries, federal government agencies and federal crown corporations). As she indicates, despite 16 years of the existence of this legislation, it has had limited impact on racial minorities and women (since there are glass ceilings at upper management levels for both the groups) but almost no impact on Aboriginals and persons with disabilities. Agocs discusses the limited success of the EEA and provides a rationale for the persistent gap between policy and practice. The papers by Thomas suggests that pro-active measures mandated by employment equity legislation in South Africa is necessary in order to ensure that employers have legislated goals and timetables for the hiring, retention, training and promotion of designated groups that are disadvantaged in the labour market (Jain, 1999; 1996; 1994). Human and social capital theories may be instructive here. Both the papers by Agocs and Thomas illustrate several of the labour market and social capital theories. The paper by Ratnam and Jain on women in labour unions in India highlights the occupational segregation suffered by women in union structures. The authors explore and document the extent of female participation in trade unions in India. They suggest that less than 8 per cent of the 380 million workforce in India are unionized and women account for a very small fraction of trade union membership. They provide a number of reasons for the low female membership and participation in unions. In the occupations where women are organized, the incidence of union leadership among women varies considerably. On the positive side, the authors note that India has been a pioneer in organizing women in the informal sector such as workers’ cooperatives, self-help groups such as Working Women’s Forum (WWF) and Self Employed Women’s Association (SEWA) etc. In fact, they find that these unions are creating social unionism, thereby rewriting the meaning of trade unionism. The focus is on broad objectives of empowerment, development and fighting for their rights rather than the business unionism in North America (that is, focus on the bread and butter issues alone). The initiatives dictated by the Indian Constitution such as reservations or quotas for Scheduled Castes and Scheduled Tribes (Jain and Ratnam, 1994) may have to be applied to labour unions and the private sector employers in the case of women in India. Policy makers and managers can learn a great deal from the theories discussed above. Harish C. Jain References: Aigner, D.J. and Cain, G.G. (1977), ‘‘Statistical theories of discrimination in labour markets’’, Industrial Labour Relations Review, Vol. 3 No. 2. Arrow, K.J. (1972), ‘‘Models of job discrimination’’, in Pascal, A.H. (Ed.), Racial Discrimination in Economic Life, D.C. Heath, Lexington, MA, pp. 187-204.
Arrow, K.J. (1998), ‘‘What has economics to say about racial discrimination?’’, Journal of economic Perspectives, Vol. 12 No. 2, pp. 91-100. Becker, G. (1957), The Economics of Discrimination, The University of Chicago Press, Chicago, IL. Becker, G. (1993), Human Capital: A Theoretical and Empirical Analysis With Special Reference to Education, 3rd ed., Chicago University Press, Chicago, IL. Elmslie, B. and Sedo, S. (1996), ‘‘Discrimination, social psychology, and hysteresis in labour markets’’, Journal of Economic Psychology, Vol. 17, pp. 465-78. Jain, H.C. (1994), ‘‘Employment equity and visible minorities: have the federal policies worked?’’, Canadian Labour Law Journal, Vol. 1, pp. 389-408. Jain, H.C. (1996), ‘‘Employment equity in Canada’’, Human Resource Management in Canada, September, Prentice-Hall, Toronto. Jain, H.C. (1999), ‘‘Global equity in the 21st century in selected countries’’, paper prepared for presentation at the 12th World Congress of the International Industrial Relations Association, Tokyo, 29 May-2 June, 2000. Jain, H.C. and Al-Waqfi, M. (2001), ‘‘Racial discrimination in employment in Canada,’’ in Reshef, Y., Bernier, C., Harrission, D. and Wagar, T. (Eds), Industrial Relations in a New Millenium: Selected Papers from the XXXVII Annual CIRA Conference, Canadian Industrial Relations Association, Quebec. Jain, H.C. and Sloane, P.J. (1981), Equal Employment Issues: Race and Sex Discrimination In the United States, Canada, and Britain, Praeger Publishers, New York, NY. Jain, H.C. and Sloane, P.J. (1982), ‘‘Race and sex discrimination in employment in Canada: theories, evidence, and policies’’, Relations Industrialles, Vol. 37 No. 2, pp. 342-66. Jain, H.C. and Venkata Ratnam, C.S. (1994), ‘‘Affirmative action in employment for the scheduled castes and the scheduled tribes in India’’, International Journal of Manpower, Vol. 15 No. 7, pp. 6-25. Loury, G.C. (1977), ‘‘A dynamic theory of racial income differences’’, in Wallace, P.A. and Lamond, A. (Eds), Women, Minorities and Employment Discrimination, Lexington Books, Lexington, MA. Loury, G.C. (1987), ‘‘Why should we care about group inequality?’’, Social Philosophy and Policy, Vol. 5, pp. 249-71. Loury, G.C. (1998), ‘‘Discrimination in the post-civil rights era: beyond market interactions,’’ Journal of Economic Perspectives, Vol. 12 No. 2, pp. 117-26. Phelps, E.S. (1972), ‘‘ The statistical theory of racism and sexism’’, American Economic Review, Vol. 62, pp. 659-61. Work, J.W. (1984), Race, Economics, and Corporate America, Scholarly Resources Inc., Wilmington, DE.
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To what extent are ethnic minorities in Britain over-educated? H. Battu and P.J. Sloane Department of Economics, University of Aberdeen, Aberdeen, UK Keywords Education, Ethnic groups, Minorities, United Kingdom, Labour market Abstract For the total population there is evidence of substantial over-education in the sense that workers possess higher qualifications than are strictly required for the job. Using the fourth wave of the British National Survey of Ethnic Minorities, this paper attempts to ascertain whether ethnic minorities suffer from higher over-education than whites due to possible discrimination. The results suggest a differential effect across various ethnic groups and a tendency for foreign qualifications to be rewarded less.
1. Introduction There has been a recent expansion in the literature documenting the extent to which workers are being fully utilised in the workplace. This literature tends to find that significant numbers of workers are employed in jobs for which their current qualifications are not a requirement; that is, they are over-educated. For the UK, Sloane et al. (1999) find that around 31 per cent of British workers are over-educated, whereby their educational attainment exceeds that required to get their job. In the USA, Sicherman (1991) found that around 40 per cent of the workforce is over-educated. However, this literature pays little attention to over-education and mismatch amongst ethnic minorities. Those studies that do so tend to find that over-education is more prevalent amongst non-whites. Duncan and Hoffman (1981) find that around 49 per cent of black males in the USA have more education than is required in their jobs compared with 42 per cent of the workforce as a whole. For the UK, Alpin et al. (1998) found that non-white graduates were more likely to be over-educated (29.9 per cent) compared to whites (26.8 per cent). This study, however, makes no allowance for the heterogeneity within Britain’s ethnic population. Explanations of over-education revolve around supplies of skills exceeding demand or imperfections in clearing the labour market. But why might non-whites have higher over-education? One argument might be that if there is discrimination, non-whites will find it harder to find a job and thus be prepared to make greater compromises. As matching is more difficult, a higher proportion of non-whites will end up over-educated. Another argument stems from the spatial constraints faced by ethnic groups. Blackaby et al. (1999) argue that commuting distances for more isolated communities are shorter and this International Journal of Manpower, Vol. 23 No. 3, 2002, pp. 192-208. # MCB UP Limited, 0143-7720 DOI 10.1108/01437720210432194
We would like to thank the Policy Studies Institute and the Data Archive at the University of Essex for giving us access to the Fourth Ethnic Minorities Data Set. Thanks are also due to an anonymous referee.
reduces the chances of better match and thus increases over-education. The lack of access to a car may be the major constraint. In fact there does exist evidence to support the view that a higher proportion of Bangladeshi and Pakistani individuals are likely to walk to work relative to whites (Blackaby et al., 1999). Over-education must be analysed in the context that ethnic minority groups may suffer from discrimination in the labour market. The UK has extensive equal opportunities legislation in relation to race and gender. The 1976 Race Relations Act mirrors the terms of the 1975 Sex Discrimination Act with respect to colour, race, nationality and ethnic or national origin. This covers recruitment, training and promotion opportunities and dismissal. It also covers both direct and indirect discrimination, the latter referring to a situation in which the proportion of one race or gender who can comply with a job requirement or condition is much smaller than the proportion of the other race or gender who can comply with it and which cannot be justified as necessary for performing the job in question. Remedies can be obtained through application to an industrial tribunal, which may make a declaration of rights, an order for compensation or a recommendation that the respondent take a particular course of action. The effectiveness of this legislation has, however, been a matter of considerable debate (see Sloane and Mackay, 1997). If certain employers only hire members of racial minority groups who possess higher educational qualifications than whites for the same job, this would be a prima facie example of discrimination. In itself, a mismatch between educational attainment and requirements is not a problem. The concern arises when mismatch generates negative effects in the labour market in terms of reduced earnings and lower job satisfaction. Most of the literature finds that though there is a benefit from surplus education in terms of a positive return to earnings, there is a penalty associated with overeducation, since this return is smaller than the return to someone who is perfectly matched (Hartog, 1997). In particular, Sloane et al. (1999) found a positive return to over-education of around 2.8 per cent, for each level of overeducation using a six-point scale, relative to a return of 19.4 per cent for required education. The fact that over-educated workers have lower job satisfaction indicates that these outcomes are not the result of workers’ choices (see for example Battu et al., 1999). On job satisfaction the reasoning is as follows. Higher attained education brings with it higher expectations in terms of challenging and interesting work duties. Incongruity between actual and required education means expectations are unrealised, generating worker dissatisfaction (for example see Tsang et al., 1991). To the extent that higher dissatisfaction generates lower work effort, this reduces worker productivity and thus the individual rate of return. Battu et al. (2000) in examining graduates found that for those who are matched to jobs which require degrees, there is a premium to job satisfaction.
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The relative lack of work on the utilisation of education within the ethnic minorities is surprising, since there exists a significant literature documenting the disadvantage faced by ethnic minorities in general, both in the UK and USA. In the UK, evidence exists for the higher unemployment, lower earnings and lower occupational attainment of non-whites (Blackaby et al., 1998; 1999). One explanation of this disadvantage focuses on the different characteristics of non-whites and, in particular, their lower educational qualifications. According to Blackaby et al. (1999) using data from the Labour Force Survey, 31 per cent of whites, 40 per cent of West Indians, 31 per cent of Indians and 54 per cent of Pakistanis have no educational qualifications. Table I provides a breakdown of the educational attainment of various ethnic groups vis-a`-vis whites from our dataset. The same regularities are evident. In addition we can make the following remarks. First, the Pakistani and Bangladeshi groups stand out in that over 70 per cent of them have no qualifications; we would expect low levels for over-education for these two groups. Second, around a quarter of the Chinese community, for whom little work has been done, have a highest qualification of degree or above. These wide differences across ethnic groups suggest that any analysis that simply focuses on whites and non-whites may not be the most revealing. Another aspect of the disadvantage of ethnic minority groups is their clear occupational crowding into less prestigious and low paid jobs. In particular, there is evidence that non-white workers have a lower representation in the managerial and professional groups relative to whites and are much more highly represented in the lowest manual occupational grouping. This is evident from examining Table III. It is worth noting that nearly half of the Bangladeshi group is in junior non-manual and personal services, in other words restaurant work[1]. This study attempts to fill this gap in the literature and examine the imbalance between educational and occupational attainment for non-whites in the UK. In particular, and utilising data from the Fourth National Survey of Ethnic Minorities, it examines three issues: (1) What is the incidence of over-education amongst the ethnic groups in the UK? (2) What factors drive any mismatch that they experience? (3) What are the consequences of this mismatch in terms of earnings? 2. Data and methodology The data employed is the Fourth National Survey of Ethnic Minorities (FNSEM) conducted in 1993/1994. The dataset includes a standard set of variables capturing individual, demographic and job characteristics (see Modood et al., 1997 for details). The dataset has the advantage that it over-samples ethnic minority groups and that it explicitly acknowledges the heterogeneity within the non-white population. The ethnic population is split into six categories:
Note: M = males, F = females
Degree and equivalent A-Level and equivalent O-Level and equivalent No qualifications n
F 15.8 9.7 45.7 28.7 1264
23.6 10.3 38.5 27.7 907
White M 15.4 6.7 39.5 38.5 481
15.6 10.4 42.0 31.9 155
Caribbean M F 12.6 6.8 20.0 60.6 746
11.7 9.7 21.6 57.0 412
Indian M F 15.7 10.7 24.1 49.4 439
14.8 13.6 27.2 44.4 250
African Asian M F 5.7 5.6 16.2 72.6 809
4.5 5.4 17.5 72.6 314
Pakistani M F
3.1 3.6 15.1 78.2 418
1.3 5.2 23.2 70.3 155
Bangladeshi M F
25.8 9.2 20.0 45.0 120
25.6 10.5 27.9 36.0 86
Chinese M F
Ethnic minorities in Britain 195
Table I. Highest UK only qualifications (per cent)
International Journal of Manpower 23,3 196
(1) (2) (3) (4) (5) (6)
Caribbean; Indian; Pakistani; African Asian; Bangladeshi; and Chinese.
Over-education could be measured in one of three ways. The first measure involves the systematic evaluation by professional job analysts who try to ascertain the level and type of education required in particular occupations. The most commonly used of these evaluations is the Dictionary of Occupational Titles (DOT) established by the US Employment Service. The second measure involves a worker making an assessment of his or her own job. In the USA, the Michigan Panel Study of Income Dynamics (PSID) asks, ‘‘how much formal education is required to get a job like yours?’’ In the UK, the Social Change and Economic Life Initiative (SCELI) data set asks, ‘‘if they were applying today, what qualifications if any would someone need to get the type of job you have now?’’ In these two measures the extent of over-education is determined by comparing the required level of education with that actually attained. A third measure is used where there is no direct question on required education for the job. Then it is customary to calculate the mean and/or modal levels of education and measure over-education as a divergence from the mean or modal[2]. However, this is inappropriate as far as racial minorities are concerned, since occupational crowding of racial minorities may provide biased estimates of the actual level of education necessary to perform the job. Rather we have preferred to utilise the mean level of acquired education for each of the five socioeconomic groups as obtained from SCELI. This has the disadvantage that it predates our dataset by some eight years. If required education has risen over this period, our estimates should be seen as an upper bound to actual overeducation. Nonetheless, it avoids the problem that in the presence of discrimination or enclave effects, the educational qualifications of minority workers may bear little relationship to the educational requirements of the job. Such measures of over-education may be criticised on a number of grounds: they are point-in-time estimates (and workers may undergo training or probation); some workers may be promoted above their formal education skills to management jobs (they become under-educated), where experience is more relevant; education credentials may in part serve signalling or screening purposes; and individuals may be over-educated in terms of their work requirements, but undereducated for activities in other markets (Behrman and Stacey, 1997). Furthermore, a significant number of the ethnic minorities are immigrants; whilst only just over half of the Caribbean population are born abroad, in excess of 75 per cent of the other ethnic groups are immigrants[3]. Hence, part of the immigrants’ stock of human capital will have been accumulated out-with the UK and it may be that this is less highly valued in the
labour market than UK acquired human capital. Our dataset does ask respondents whether they have foreign qualifications. Around 16 per cent of the sample possesses foreign qualifications. The highest proportions are amongst the Indians, Asians and Chinese. Details of highest UK qualifications are contained in Table I and incorporating foreign qualifications in Table II for each of the seven ethnic groups. Making an allowance for foreign qualifications raises the educational profile of all non-white groups. For example, 27.3 per cent of Indian males have as their highest qualification at least a degree compared to 12.6 per cent when we ignore foreign qualifications. At the other end of the spectrum, the number of Indian males who have zero qualifications slumps to less than 40 per cent. Table III provides some data on socio-economic distribution of non-whites. It is clearly evident that non-white workers have a lower representation in the managerial and professional groups relative to whites. Some estimates of over, under and adequate education are given in Tables IV and V. A number of points are worth making. First, and in line with the majority of studies in this literature (Green et al., 1999) the incidence of overeducation exceeds that of under-education for both whites and non-whites. Second, about 70 per cent of whites and 67 per cent of non-whites have a good match (they are adequately educated). Third, when foreign qualifications are removed from our calculations, over-education falls for non-whites from 24 per cent to just over 16 per cent and undereducation rises to 16.8 per cent from 9.1 per cent. In fact, when we incorporate foreign qualifications the gap in overeducation between non-whites and whites rises. Studies that ignore any qualifications obtained outside the UK may then underestimate the degree of mismatch between educational requirements and attainment. Our results in Table V also support the view that non-whites have greater over-education than whites. However, when we disaggregate we find that only three ethnic groups have higher over-education than whites (19.7 per cent). These are Indians (33 per cent), African-Asians (33.2 per cent) and Chinese (30.8 per cent). The one outlier seems to be the Bangladeshis who are substantially less likely to be over-educated (13.2 per cent) and more likely to be undereducated (35.9 per cent) than any of the other ethnic groups. Unemployment is significantly greater for this group[4], so that those who get jobs may be the most able, or the most educated within that group. It may also be the case that they are more likely to be employed by members of their own community in ethnic enclaves (for example, restaurants). Workers may be able to obtain employment here without any qualifications, though certain qualifications may be required. A multinomial logit model is used to investigate the probability of being over- and under-educated. This maximum likelihood estimation technique is appropriate where there is a discrete dependent variable covering two or more values. Our multinomial logit model estimates two sets of coefficients, 1 (overeducated) and 3 (under-educated) using the median measure of mismatch. From these two sets of coefficients we can calculate the probability Pij of
Ethnic minorities in Britain 197
Table II. Highest qualifications incorporating foreign qualifications (per cent)
Note: M = males, F = females
24.1 10.9 38.6 26.4 907
F 16.5 10.5 45.7 27.3 1264
White
15.8 7.1 41.8 35.3 481
15.8 10.8 45.0 28.4 155
Caribbean M F 27.3 10.1 26.0 36.6 746
25.0 14.8 28.2 32.0 412
Indian M F 21.6 14.8 32.1 31.4 439
21.6 15.6 37.2 25.6 250
African Asian M F 10.3 8.7 28.1 53.0 809
8.0 8.0 30.3 53.8 314
Pakistani M F
6.7 6.5 19.4 67.5 418
3.2 6.5 31.6 58.7 155
Bangladeshi M F
198
Degree and equivalent A-Level and equivalent O-Level and equivalent No qualifications n
M
32.5 10.0 25.8 31.7 120
30.2 12.8 34.9 22.1 86
Chinese M F
International Journal of Manpower 23,3
Note: M = males, F = females
Managerial and professional Intermediate non-manual Junior non manual Skilled manual Low skilled/unskilled n
6.2 22.8 41.6 7.5 21.9 483
Caribbean M F
15.5 10.5 31.2 19.1 13.0 13.0 40.8 17.3 14.7 7.0 29.3 24.5 16.6 17.6 29.8 730 1023 400
White M F 16.9 9.2 21.5 16.9 35.5 498
15.5 11.3 34.0 10.2 29.1 265
Indian M F 23.8 8.7 28.9 16.4 22.2 311
18.1 11.7 38.6 8.2 23.4 171
African Asian M F 16.1 6.8 15.5 25.6 36.0 336
8.1 12.1 21.2 22.2 36.4 99
Pakistani M F
14.9 5.1 47.4 6.3 26.3 175
4.4 4.4 57.8 8.9 24.4 45
Bangladeshi M F
47.6 14.6 19.5 2.4 15.9 82
21.9 18.8 46.9 3.1 9.4 64
Chinese M F
Ethnic minorities in Britain 199
Table III. Socio-economic groups (per cent)
International Journal of Manpower 23,3 200
individual i being over-educated (j = 1) or under-educated (j = 3), conditional on a vector of personal characteristics xi. Our specification xi includes demographic variables (age, age squared, gender, marital status) and a range of job characteristics (workplace size, trade union membership, public sector)[5,6]. To gauge the importance of enclaves and assimilation, we also include having a white boss where this is intended to capture the extent to which ethnic workers have managed to break out from ethnic enclaves, years since immigration, ethnic concentration at ward level and the number of private vehicles in the household. To investigate the effect on earnings we use a traditional human capital framework where individual earnings are related to personal, human capital, job-specific and area-specific characteristics. The specific controls used are age and its square, dummies for marital status, gender, ethnic group member, industry, and area of residence. To investigate the effects of mismatch we included separate dummies for over- and under-education and a variable for required education. The regressions are run for whites and non-whites and in the case of the latter, a distinction is made between natives and non-natives. Earnings data in the FNSEM are banded where individuals were asked to indicate which of 16 income bands best encapsulated their income. The dependent variable (the log of weekly earnings) takes the midpoint of 16 bands with the upper limit of the final band determined by multiplying the lower threshold by 1.5 (Chiswick and Miller, 1995) and estimation is by least squares. We also used an interval regression approach but since the results were similar to the ordinary least squares estimates we do not report them here. 3. Results A multinomial logit approach is used where the dependent variable is a three point variable indicating whether the individual is over-educated, adequately educated or under-educated. Only the results for non-whites are provided since the results for whites are standard (Table VI). Both coefficients and marginal effects are reported. From the results it is clear that there is no case for a separate analysis of males and females since the gender dummy is insignificant. Examining first the over-education equation, the presence of a white boss increases the likelihood of a mismatch between education attainment and requirements (the marginal effect is 0.166). This is perhaps surprising since
Over-educated Adequately educated Under-educated n
Whites
Non-whites
19.7 (18.9) 70.3 (70.1) 9.9 (11.1) 1753
24.0 (16.3) 66.9 (67.0) 9.1 (16.8) 2928
Table IV. Levels of mismatch across gender (per cent) Note: Figures in parentheses exclude foreign qualifications
19.7 (18.9) 70.3 (70.1) 9.9 (11.1) 1753
16.3 (15.7) 77.6 (76.3) 6.1 (7.9) 883
Caribbean
Note: Figures in parentheses exclude foreign qualifications
Over-educated Adequately educated Under-educated n
White 33.0 (16.6) 61.6 (65.9) 5.4 (17.4) 763
Indian 33.2 (24.3) 59.8 (58.9) 7.1 (16.8) 482
African Asian 16.8 (9.7) 74.0 (75.2) 9.2 (15.2) 435
Pakistani
30.8 (26.0) 56.8 (51.4) 12.3 (22.6) 146
Chinese 13.2 (6.4) 50.9 (45.5) 35.9 (49.1) 220
Bangladeshi
Ethnic minorities in Britain 201
Table V. Levels of mismatch across ethnic groups using the mean measure (per cent)
Table VI. Determinants of mismatch for non-whites (multinomial logit) (0.98) (0.71) (0.09) (0.08) (0.01) (0.91) (0.03) (3.01)** (0.42) (1.76)*** (1.02) (1.83)*** (1.07) (1.62) (1.78)*** (1.42) (0.62) (2.08)* (1.02) (0.74) (2.95)** (0.14)
–0.016 0.014 0.005 0.006 0.001 –0.037 0.002 0.166 0.016 0.079 –0.095 –0.183 –0.116 –0.173 0.084 –0.004 –0.071 0.226 0.112 0.086 0.086
0.279 –0.288 –0.387 –0.162 0.101 –1.524 –1.327 –2.152 –1.337 –2.063 0.449 0.142 0.495 0.368 1.057 –0.008 –0.373 –3.570 –1.671 –2.460 –0.227 –4.505 518
(2.00)* (1.72)*** (0.82) (0.24) (0.09) (2.25)* (1.93)*** (4.08)** (2.15)* (2.90)** (0.24) (0.07) (0.26) (0.19) (2.05)* (0.25) (0.50) (4.28)** (2.52)* (3.26)** (0.70) (1.43)
0.004 –0.004 –0.005 –0.002 0.001 –0.018 –0.016 –0.028 –0.016 –0.026 0.007 0.004 0.008 0.007 0.011 –0.000 –0.003 –0.046 –0.022 –0.031 –0.004
Notes: Log likelihood = –321.11704; LR(42) = 217.747(Prob > LR = 0.000); Pseudo R2 = 0.2532; McFadden’s R2 = 0.253; Absolute value of z-statistics in parentheses * significant at 5 per cent level; ** significant at 1 per cent level; *** significant at 10 per cent level; Excluded categories: single, Bangladeshi, ward unemployment less than 5 per cent and working for firm with less 500 employees Dependent variable: Oemean2 (= 1 if over-educated, = 2 if adequately educated and = 3 if under-educated) The marginal effect for a continuous variable is calculated for a one year increase. For dummy variables it represents an average person with that particular characteristic relative to the base characteristic
–0.090 0.080 0.023 0.031 0.004 –0.242 –0.008 0.963 0.073 0.440 –0.560 –1.092 –0.688 –1.030 0.521 –0.024 –0.433 1.297 0.646 0.474 0.514 0.255 518
Under-education Coefficient Marginal effect
202
Age Age sq/100 Male Married Workplace size 500 plus Trade union at work Works for public firm White boss Supervise Training Ward unemployment between 5 and 10 per cent Ward unemployment between 10 and 15 per cent Ward unemployment between 15 and 20 per cent Ward unemployment more than 20 per cent Own group in area less than 5 per cent Years since immigration Caribbean Indian African Asian Pakistani No of vehicles in household Constant Observations
Over-education Coefficient Marginal effect
International Journal of Manpower 23,3
being employed by a white boss may indicate that an individual has managed to break out of an ethnic enclave and thereby improved their match. The fact that having a white bosses raises over-education may indicate that minority bosses are more prepared than white bosses to accept foreign qualifications. Similarly, where one’s own group represents less than 5 per cent of the population in the area, this increases the likelihood of over-education. This is consistent with enclaves helping the matching process and isolation from one’s own group creating the reverse situation. The number of private vehicles in the household increases the likelihood of over-education for non-whites (by 0.086 per car). This result runs counter to the arguments of Blackaby et al. (1999) whereby having greater access to transport increases the potential area of job search (outside the enclave) and thus may improve the possibility of a better match. One explanation for our result may be that being further away from the job makes workers less attractive to employers and that being over-educated is some form of compensation for this. The coefficients on our various ethnic groups behave as expected, given the data in Table V. However, with the introduction controls only the Indian ethnic group is more likely to be over-educated (a large marginal effect of 0.226) relative to the omitted category, the Bangladeshi. This might simply reflect the lower probability of the latter finding employment. Another important characteristic of ethnic minorities is their concentration within ethnic enclaves where these enclaves have high unemployment[7]. Unemployment at a local level is captured via the ward unemployment rate. There are 9,527 wards in English and Wales where these represent the geographic ‘‘building blocks’’ in Great Britain. We find that around 70 per cent of the white sample live in a ward with an unemployment rate of less than 10 per cent. This compares with 11.5 per cent for the Pakistani group and 6.1 per cent for Bangladeshis. Higher ward level unemployment tends to reduce the probability of over-education. A more plentiful supply of labour may improve matching to the extent that only quality labour with the required level of education gets employed and the relative advantage of hiring over-educated workers diminishes. It is cheaper to employ workers with the required level of education and if these are of higher quality, any productivity advantage of over-educated workers will diminish (of course, the over-educated would be more prepared to accept lower level jobs if unemployed). In the under-education equation, the presence of a white boss reduces the likelihood of under-education and the under-educated are less likely to have received training (as opposed to more likely in the over-education model). However, own group being less than 5 per cent of the total population increases the likelihood of under-education (as in the over-education model). Furthermore, Indians, African-Asians and Pakistanis are significantly less likely to be under-educated than Bangladeshis. The presence of trade unions and working in the public sector significantly reduces the likelihood of being under-educated. This may reflect the more stringent use of formal qualifications in the public sector and possibly trade
Ethnic minorities in Britain 203
International Journal of Manpower 23,3 204
unions insisting on workers with the appropriate qualifications gaining employment. The results for the earnings equations are given in Table VII where there are separate regressions for non-whites non-natives, non-white natives and whites. Across all three samples there is a substantial earnings premium associated with required education, which corresponds to findings in Battu et al. (2000). However, non-white immigrants seem to obtain the smallest premium to required education. There are also positive returns to surplus education and negative returns to under-education, but in line with Sicherman’s (1991) stylised facts, the over-educated earn less than if they were appropriately matched and the under-educated more than if they were appropriately matched. The corresponding figures are lower for non-white natives than for non-white non-natives but do still confirm Sicherman’s stylised facts. Non-native non-white men earn 12 per cent more than non-native women, while for native non-whites the gender mark up is 16 per cent. There are no significant differences in earnings between the various minority groups. However, language fluency increases earnings by approximately 14 per cent. This compares with an equivalent figure of 16 per cent in a study by Dustmann and Fabbri (2000) using the same dataset. For non-native ethnic minorities there is a positive effect on earnings in having a higher proportion of one’s ethnic group in the total local population, consistent with an enclave effect. The enclave in this case offers benefits to nonUK born non-whites in terms of higher earnings, possibly because employers in these enclaves recognise foreign qualifications. Having more access to private vehicles the greater the possibility of escaping an enclave. The individual may still live in and enjoy certain cultural benefits stemming from the enclave but does have longer commute distances to employment. Indeed, a rise in number of vehicles in the household is associated with higher earnings for both non-white samples. Weekly earnings also rise with age and whites and non-white non-natives employees in large establishments (over 500 employees) enjoy an earnings premium. There is no evidence of a wage curve effect at the ward level, since no relationship between living in a ward with higher unemployment and earnings was detected. Living in the south-east of England is clearly associated with higher earnings for all three groups[8]. Whites and non-white natives obtain an earnings premium in construction, energy, minerals, engineering, other manual and banking relative to other services. For non-white immigrants, this premium exists only in energy, minerals and banking. 4. Conclusions This paper has, for the first time, attempted to analyse the extent to which various ethnic minority groups in Britain fail to find optimal matches in the labour market. Consistent with the presence of discrimination, a higher proportion of ethnic minority non-whites are over-educated than is the case for the white population, though the extent of this varies across the various
Age Age sq/100 Male Married Caribbean Indian African Asian Pakistani Chinese Fluent Over-education Under-education Required Years since immigration Years since immigration2 Own group in area between 5 and 15 per cent Own group in area between 15 and 25 per cent Own group in area between 25 and 33 per cent Own group in area more than 33 per cent Ethnic density is 10 per cent or more Ward unemployment less than 5 per cent Ward unemployment between 5 and 10 per cent Ward unemployment between 10 and 15 per cent Ward unemployment between 15 and 20 per cent Workplace size 500 plus South-east Number of vehicles in household Construction Energy Minerals 0.020 0.039 0.027 0.085 –0.093 –0.065 0.080 0.065 0.136 0.234 0.105 0.762 0.696 0.525
0.021 (0.19) 0.085 (1.25) 0.071 (1.19) 0.024 (0.37) 0.244 (4.50)** 0.135 (3.00)** 0.079 (2.62)** 0.113 (1.28) 0.324 (2.01)* 0.402 (2.56)*
(0.54) (0.56) (0.85) (0.64) (1.47) (3.48)** (2.47)* (5.00)** (3.03)** (2.25)*
(0.24) (0.33) (0.17) (0.35)
0.126 (1.79)*** –0.191 (0.91) 0.251 (1.68)***
0.161 (3.66)** –0.237 (3.16)** 0.160 (2.49)* 0.006 (0.09) –0.025 –0.077 (0.28) –0.183 (0.61) –0.157 (0.55) 0.094 (0.31)
Non-white natives
(2.50)* (2.38)* (2.81)** (1.14) (0.81) (0.32) (0.26) (0.28) (0.07) (2.60)** (3.23)** (2.19)* (3.95)** (1.46) (0.57) (3.04)** (0.82) (2.31)* (0.68)
0.037 –0.043 0.125 0.067 0.077 –0.029 0.023 0.026 0.007 0.142 0.165 –0.174 0.464 0.013 –0.000 0.165 0.061 0.188 0.060
Non-white non natives (3.81)+ (3.39) (6.52)+ (1.70)~
–0.069 (0.99) 0.080 (0.56) 0.075 (0.54 0.094 (0.65) 0.105 (0.60) 0.200 (3.89)+ 0.205 (4.60)+ 0.030 (1.10) 0.574 (6.11)+ 0.666 (5.41)+ 0.499 (3.84)+ (continued)
0.223 (4.61)+ –0.271 (3.80)+ 0.458 (5.61)+
0.044 –0.050 0.264 –0.074
Whites
Ethnic minorities in Britain 205
Table VII. Log of weekly earnings
Table VII. 0.090 0.147 –0.026 –0.174 0.289 3.045 938 0.37
(0.57) (1.58) (0.26) (1.58) (3.58)** (10.62)**
0.595 0.480 0.225 0.061 0.568 1.647 365 0.37
(2.66)** (3.40)** (1.43) (0.39) (3.68)** (2.43)*
Non-white natives
206 0.376 0.403 –0.034 –0.115 0.513 3.218 1068 0.41
(2.93)+ (4.50)+ (0.35) (1.08) (5.29)+ (12.29)+
Whites
Notes: Absolute value of t-statistics in parentheses; * significant at 5 per cent level; ** significant at 1 per cent level; *** significant at 10 per cent level; Excluded categories: single, Bangladeshi, adequately educated, own group in areas below 5 per cent, ward unemployment greater than 20 per cent, working for firm with less 500 employees and works in other services
Engineering Other manual Hotels Transport Banking Constant Observations Adjusted R2
Non-white non natives
International Journal of Manpower 23,3
minority ethnic groups. Indians, African-Asians and the Chinese exhibit levels of over-education in excess of 30 per cent. This compares with around 20 per cent for whites. In contrast, 36 per cent of Bangladeshi workers have fewer qualifications than is required for their job (they are under-educated). In our examination of the determinants of mismatch using a multinomial logit model, we find that the Indian group are more likely to be over-educated and less likely to be under-educated. In addition, all three measures of the extent to which ethnic groups have managed to break out of ethnic enclaves (white boss, access to private transport, living in a low ethnic concentration ward) all raise the likelihood of being over-educated. Enclaves seem to improve job matches. The results from our earnings regressions support the previous work in finding a positive return to surplus education, a positive and higher return to required education and a negative return to under-education. The results vis-a`-vis our enclave variables are less clear-cut when it comes to earnings. On the one hand, the longer the stay in the UK and the greater the access to private transport, the higher are ethnic earnings. On the other hand, increases in own ethnic concentration raises earnings, perhaps because enclaves recognise foreign qualifications. A lack of English language fluency has a significant and substantial negative effect on earnings. Notes 1. According to Modood et al. (1997) ‘‘. . . more than half of all employed Bangladeshi men have just one occupation; waiting and kitchen work in restaurants’’. 2. For a discussion of the relative merits of these measures see Battu et al. (2000). 3. From our sample, 93 per cent of the Bangladeshi population are born outside the UK. 4. In our sample, 19.2 per cent of the Bangladeshis are registered unemployed compared to 6.8 per cent for whites. It is worth noting that unemployment rate in the UK during 1993/ 1994 was high at around 10 per cent. The effects of this demand side influence are captured in our analysis by local or ward unemployment. 5. Age is used as a proxy for work experience. 6. It would not make sense to include in the specification actual education since those with the highest possible education cannot be under-educated and those with zero qualifications cannot be over-educated. 7. For details see Peach (1996). 8. The 1991 Census of Population shows that around 45 per cent of the ethnic minority population is located in London. In our dataset the ethnic population is concentrated in two areas: London (south east) and the west midlands. References Alpin, C., Shackelton, J.R. and Walsh, S. (1998), ‘‘Over and under-education in the UK graduate labour market’’, Studies in Higher Education, Vol. 23, pp. 17-34. Battu, H., Belfield, C.R. and Sloane, P. (1999), ‘‘Over-education among graduates: a cohort view’’, Education Economics, Vol. 7, pp. 21-38. Battu, H., Belfield, C.R. and Sloane, P. (2000), ‘‘How well can we measure graduate over-education and its effects?’’, National Institute Economic Review, Vol. 171, pp. 82-93.
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Behrman, J.R. and Stacey, N. (1997), The Social Benefits of Education, Michigan University Press, Michigan, MI. Blackaby, D., Leslie, D., Murphy, P. and O’Leary, N. (1998), ‘‘The ethnic wage gap and employment differentials in the 1990s: evidence from Britain’’, Economic Letters, Vol. 58, pp. 97-103. Blackaby, D., Leslie, D., Murphy, P. and O’Leary, N. (1999), ‘‘Unemployment among Britain’s ethnic minorities’’, The Manchester School, Vol. 67 No. 1, pp. 1-20. Chiswick, B.R. and Miller, P.W. (1995), ‘‘The endogeneity between language and earnings: an international analysis’’, Journal of Labour Economics, Vol. 13 No. 2, pp. 246-88. Duncan, G.J. and Hoffman, S.D. (1981), ‘‘The incidence and wage effects of over-education’’, Economics of Education Review, Vol. 1 No. 1, pp. 75-86. Dustman, C. and Fabbri, F. (2000), Language Proficiency and Labour Market Performance of Immigrants in the UK, Discussion paper, No. 156, IZA, Bonn. Green, F., McIntosh, S. and Vignoles, A. (1999), Over-education and Skills – Clarifying the Concepts, Discussion paper 435, Centre for Economic Performance, London. Hartog, J. (1997), ‘‘On returns to education: wandering along the hills of our land’’, paper presented at Applied Econometrics Association, Maastricht. Modood, T. et al. (1997), Ethnic Minorities in Britain: Diversity and Disadvantage, Policy Studies Institute, London. Peach, C. (1996), ‘‘Does Britain have ghettos?’’, Transactions of the Institute of British Geographers, Vol. 21, pp. 216-35. Sicherman, N. (1991), ‘‘Over-education in the labor market’’, Journal of Labor Economics, Vol. 9 No. 2, pp. 101-22. Sloane, P. and Mackay, D. (1997), ‘‘Employment equity and minority legislation in the UK after two decades: a review’’, International Journal of Manpower, Vol. 18 No. 7, pp. 597-626. Sloane, P., Battu, H. and Seaman, P. (1999), ‘‘Over-education, undereduction and the British labour market’’, Applied Economics, Vol. 31 No. 11, pp. 1437-54. Tsang, M.C., Rumberger, R.W. and Levin, H.M. (1991), ‘‘The impact of surplus schooling on workers productivity’’, Industrial Relations, Vol. 30 No. 2, pp. 209-28.
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Australian immigration: the triumph of economics over prejudice? Julian Teicher
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Department of Management, Monash University, Victoria, Australia
Chandra Shah Monash University – ACER Centre for the Economics of Education and Training, Victoria, Australia, and
Gerard Griffin National Key Centre in Industrial Relations, Monash University, Victoria, Australia Keywords Immigrants, Labour market, Multi-cultural society, Australia Abstract This paper provides an account of Australian immigration in the late twentieth century focusing on labour market and industrial relations issues. The paper chronicles the changing immigration policy framework, from one premised on exclusion to one designed primarily to serve the needs of the domestic labour market. One of the consequences of the policies, more by default than design, has been the transformation of society from a monocultural to a multicultural one. In spite of this migrants from other than mainly English speaking (MES) countries often have poor labour market outcomes, sometimes well after the time of arrival. This group appears to be more adversely affected by the downturn in economic cycles than other migrants or the Australian-born population. At the industrial relations level trade unions have made a pragmatic, as well as a principled, shift to embrace immigrant workers from non-MES countries. However the transition from a centralized system of conciliation and arbitration to a more deregulated labour market has compounded the disadvantage suffered by these workers.
1. Introduction A series of paradoxes surround Australia’s immigration program. Most notably, although Australia’s history is ‘‘rooted in deep-seated racism and prejudice’’ it has laregly avoided the excesses of racial violence that have accompanied large-scale migration in other countries. Australian immigration was initially planned on monocultural lines, but after the Second World War practical considerations saw the relaxation of this policy, the consequence of which has been the emergence of a multicultural society, admittedly more by default than design. Immigrants figure prominently among the wealthiest Australians but are ‘‘disproportionately represented among the poor and the unemployed’’ (Collins, 1988, pp. i-ii). Immigrants have been a continuous source of population and labour force growth from the beginning of Australian colonisation in the late eighteenth century, though the level and composition of the intake varied over time. For We wish to thank Marco Michelotti for research assistance and Rosalie Triolo for comments on an earlier draft of this paper.
International Journal of Manpower, Vol. 23 No. 3, 2002, pp. 209-236. # MCB UP Limited, 0143-7720 DOI 10.1108/01437720210432202
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much of the twentieth century the driving force of immigration policy was the perceived need to populate a vast and indefensible continent and to secure a labour force to undertake the associated task of economic development (Jupp, 1998). Overlaid on this was a longstanding concern by governments to limit the intake of non-Europeans. This sentiment found expression in the infamous ‘‘White Australia’’ policy, which remained in force until 1973. The dominance of immigration from Britain was confined to the early years of colonisation when a large number of convicts and assisted immigrants arrived. Immediately after the Second World War, the difficulty of attracting British migrants resulted in large-scale immigration of displaced persons from Europe, after which the emphasis switched to immigrants from southern Europe. Following the abandonment of a policy based on racial exclusion, immigration flows became more diverse with Asian and African (mainly South Africa) nations featuring prominently over the last two decades. In contrast to much of Europe, Australian immigration has been distinguished by the fact that, until comparatively recently, migrants were mostly permanent arrivals. In the post-war decades, newly arrived migrants were typically deployed in dirty and difficult jobs which were shunned by the Australian-born. For some this appears to have been only a transitional phase, as they soon became occupationally mobile reaching levels of attainment similar to that reached by the native-born (Committee to Advise on Policies for Manufacturing Industry, 1976). This process of transition was qualified during periods of economic recession with spells of long-term unemployment harming the future prospects of migrants, particularly those lacking formal qualifications and skills and proficiency in English. In the 1990s there was a major shift in migrant inflows as policy became more sharply focused on economic considerations and this was reflected in two ways: the growth in business migration and the use of temporary migrants. In large measure this reflected the increasing preoccupation of government economic policy with improving Australia’s capacity to compete in the emergent global economy. At the same time as governments have focused on economic restructuring, there has been a rise in racist sentiments among certain sections of the Australian population, and this has achieved particular notoriety in the media. This sentiment has largely been associated with the rise of a populist political party, ‘‘Pauline Hanson’s One Nation Party’’, so named for its founder and leader. This party is best known for its anti-Asian immigration views and an unsympathetic attitude to the plight of Australia’s aborigines, but its other views include opposition to gun control, privatisation, foreign investment, tariff reductions and globalisation. Significantly, its popularity is largely confined to regional Australia, that is, areas which have been most adversely affected by economic restructuring. While, One Nation has contested seats in both federal and state elections, its electoral successes have been limited to a small number of seats in the parliaments of two sparsely populated and rural dominated states and its leader held a seat in the national parliament for three years (1996-1999).
In this paper our principal objectives are twofold: to provide an account of Australian immigration in the late twentieth century, from both a demographic and a labour market perspective and to examine a range of labour market and industrial relations issues associated with this migration. The structure of the paper is as follows. First, we provide an overview of Australian immigration from white settlement, though the emphasis is upon the latter half of the twentieth century. Included here are data that highlight the changing sources of immigration and the fluctuations in settler arrivals in the last four decades of the twentieth century. However, the task of analysis is complicated by the fact that the available data collections do not allow us to infer the race of the various settler groups. Second, the focus shifts to the development of the regulatory framework of Australian immigration. This neatly captures the demise of a migration policy premised on exclusion and the development of a policy more attuned to the requirements of the domestic labour market. Third, we undertake a detailed examination of the labour market experience of immigrants, drawing on data on labour force participation, employment and unemployment and earnings. In the final section, three closely linked industrial relations issues are discussed, these are: (1) the extent and impact of discrimination on immigrant workers; (2) the changing union response to immigrants; and (3) the impact of the new, deregulated industrial relations system of enterprise based bargaining on immigrants. 2. Transition to a multicultural society For the first 150 years of Australian colonisation, all immigration from non-English speaking countries was discouraged, though occasional exceptions were made for people of Nordic and German origins. Underlying this exclusion were notions of an Anglo-Saxon race and an emergent concept of an Australian race. These notions of racial superiority were not confined to Australia, but were part of a ‘‘general racial theory which was widely accepted in the British Empire’’ (Jupp, 1998, p. 100). This prejudice found its expression in the concept of the ‘‘White Australia’’ policy which, in its various forms, provided for exclusion based on race until its formal abandonment in 1973. In this section we provide an overview of the development of Australian immigration, focusing on the period from 1945-1999, while the following section highlights the changing immigration policy framework and its implications for the labour market. Before federation in 1901 the colonies introduced immigration restriction legislation in response to the large-scale arrival of Chinese people during the gold rushes of the mid-nineteenth century. With federation, the White Australia policy crystallised around the operation of the Immigration Restriction Act, 1901. This legislation was supported by other measures such as restricting assisted passages to UK subjects of European race, quotas on non-European immigration, limitations on citizenship rights and an ‘‘official and popular
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climate of opinion which discouraged ‘‘alien’’ settlement’’ (Jupp, 1998, p. 101). Some public figures, the media and major organisations like the Returned Services League openly expressed racist and xenophobic views. Moreover, both conservatives and many labour movement participants shared such views. Given the prevailing social attitudes to migration and immigrants, it is hardly surprising that in the first half of the twentieth century the small communities of Jewish, Italian, Greek, German, Chinese, Maltese and Croatian immigrants were ‘‘usually self-effacing and unobtrusive’’ (Jupp, 1998, p. 101). At the end of the Second World War, Australia was a largely monocultural society with less than one million residents born overseas out of a population of almost seven million, the majority of migrants being of British origin. Paradoxically, by the end of the 1960s, Australia had become one of the most ethnically diverse populations in the world, with over 100 nationalities and ethnic groups being represented. This development is largely accounted for by the fact that pragmatism had unofficially replaced an immigration policy initially designed to preserve racial homogeneity (Collins, 1988; Jupp, 1998). In 1945 Australia launched its post-war immigration program, the largest planned immigration undertaken in this country. Economic factors and the defence related catchcry of ‘‘populate or perish’’ were the driving forces behind post-war immigration. The program planned to use large scale immigration to accelerate the tasks of economic development, particularly large scale public works, such as the creation of hydro-electric schemes and modernisation of road and rail systems, and industrial diversification away from Australia’s historical dependence on primary production (Jupp, 1998). Accordingly, the immigration program was premised on population growth of two percent annually, with one percent coming from immigration. In the early post-war years this target was regularly exceeded but between 1952 and 1970 the migrant intake was 30 per cent below target. Despite this shortfall, by 1970 some 21 per cent of the population was overseas-born and another 20 per cent had at least one migrant parent. Next to Israel, no other country was so transformed by its post-war immigrant intake (Collins, 1988). Almost from the outset there were insufficient British settlers to achieve planned quotas and, as economic conditions improved in Britain, it became necessary to turn to displaced persons from the war and Eastern Europe as migrant intake sources. These migrants, however, were selected in line with the tenets of the White Australia policy and, reflecting ‘‘cold war’’ concerns, their anti-communist credentials (Jupp, 1998). Displaced persons had the added attraction that they accepted conditions that would have been rejected by voluntary migrants. For example, they were housed in former army camps and were in effect conscripted to designated jobs and locations for two years after arrival. The ending of the program for displaced persons in 1953 and continuing shortfalls in British migration led to the immigration net being cast more widely. First to:
The ‘‘more cultured’’ migrants from northern Europe, then southern Europe, the Middle East and so on until the early 1980s when the Indo-Chinese were the largest group in the immigration intake (Collins, 1988, p. 10).
In this intermediate stage, migrants were attracted by extension of the assisted passage scheme to encompass all Europeans, not just British immigrants, and by concluding inter-government agreements with the major European nations as discussed below. Consequently, the immigration intake in the 1950s was mainly from Britain (33 per cent), northern Europe (26 per cent) and southern Europe (33 per cent). During the 1960s, British immigration increased in both absolute and relative terms due to a number of factors. First, there was a decline in European migration as economic conditions improved in Europe and the Treaty of Rome facilitated movement of labour among European Economic Community nations. Second, a change in the Australian government policy allowing a greater proportion of dependents in the immigration quotas meant a large number of British people qualified for migration (Collins, 1988). At the same time, the White Australia policy was reinforced: the Commonwealth Immigration Acts of 1962 and 1968 were used to exclude British subjects from the former colonies, mainly West Indian, Indian and Pakistani peoples. The seeds of the demise of racist immigration policy were diverse. Undoubtedly, pragmatic considerations, particularly Australia’s increasing military and economic engagement in Asia, were a major consideration (Jupp, 1998). Quite simply, Australia’s major trading partners, such as Japan and Singapore, would no longer accept the continuance of such a policy. Foreign policy considerations also played a major part in this change, as in the 1960s the continuing process of de-colonisation in Africa and Asia highlighted the paradox of an immigration policy simultaneously premised on exclusion and mass immigration of skilled workers. One consequence of this process was that people of mixed European and Asian culture and descent, such as Anglo-Indians, Sri Lankan Burgers and French speaking Eurasians, sought haven in Australia but were often excluded only on the grounds of their Asian characteristic and appearance. At home, support for a racially based immigration policy had gradually declined among unions, the labor party and the better educated, so that by the 1960s, cases of racist exclusion and deportation attracted sympathetic media coverage. As well, pressure was being brought to bear by the governments of other nations, including the UK and the USA. Thus it was in the 1970s, as is shown below, that immigrants to Australia began to be drawn in large numbers from non-English speaking countries of Asia and the Middle East. While the British remained the largest immigrant group, Asian migrants accounted for 32 per cent of the intake in the decade 1973-1982, up from 2 per cent in 1951-1960. This trend continued in the 1980s, bolstered by the arrival of refugees from Indo-China. Indeed, Asian immigrants were the largest group for the first time in 1982-1983 financial year, accounting for 36 per cent of net settler gain compared to 26 per cent from Britain.
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Pattern of permanent arrivals, 1959-1999 As in the immediate post-war years, immigration in recent decades has been a major contributor to population growth, with permanent settler arrivals since 1960 totalling 4.3 million, though annual arrivals varied from 53,000 in 1976 to a high of 185,000 in 1970. Underlying this data are some major changes in the composition of the migrant intake that has transformed Australia into the multicultural society that it is today. Firstly, in the early 1960s, three quarters of migrants came from the mainly English speaking (MES) countries (UK, Ireland, New Zealand, Canada, South Africa and the USA), but by the early 1990s the proportion had dropped as low as 28 per cent (see Table I). However this trend was partially reversed by the end of that decade with immigrants from MES countries increasing to 36 per cent, mainly as a result of New Zealanders gaining unrestricted access to Australia pursuant to the Trans Tasman Travel Arrangement. Until the mid-1990s, the UK was the major single source of annual settler arrivals; for example, in the 1960s, two thirds of migrants were born in the UK, but this fell to around 10 per cent by the end of the twentieth century. Secondly, there has been a shift in Australia’s traditional reliance on migrants from European countries. Between 1970-1975, people born in East Asia and South East Asia constituted less than 4 per cent of all arrivals, but this per centage increased dramatically to 42 per cent in 1992 before falling back to 26 per cent in 1999. The gender balance of migrants has altered in favour of females. In the early 1960s, women made up less than half the total intake but by 1999 they were in the majority. Similarly, the average age of migrants has increased over time: in the early 1960s, 67 per cent of migrants were under the age of 30 but by the late 1990s only 55 per cent were in this age group. The annual fluctuation in arrival numbers is illustrated in Figure 1. The graph highlights the fact that the number of arrivals is very much affected by economic conditions in Australia. The significant drops in migration have followed the recessions of 1960-1961, 1974-1975, 1982-1983 and 1990-1992. They reflect not just diminished overseas interest in migration to Australia but also a reduction in migrant intake targets set by the government, usually through a contraction in the occupations listed as ‘‘in demand’’ under the skilled Period
Table I. Percentage of permanent settler arrivals born in MES countries, 1959-1999
1959-1965 1965-1970 1970-1975 1975-1980 1980-1985 1985-1990 1990-1995 1995-1999
Arrivals (per cent) 76 55 55 46 46 38 28 36
Source: ABS Australian Immigration Consolidated Statistics (various issues)
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Figure 1. Permanent settler arrivals, Australia, 1959-1960 to 1998-1999
migration category (Foster, 1996). The development of a policy framework for targeting immigration on the basis of economic considerations, particularly skills, is the subject of the following section. 3. Regulation of immigration and labour We will argue in this section that in addition to the racism that underpinned Australian immigration for much of the twentieth century, the major theme has been domestic labour market protection. The articulation of immigration policy in the last decades of the twentieth century has been distinctive in two ways: the development of a more sophisticated process of labour market targeting and a move toward recruitment of temporary migrants. After federation in 1901, it fell to the new national government to regulate immigration. The policy continued to be racially based, the principal mechanisms being the Immigration Restriction Act, 1901 and the Pacific Island Labourers Act, 1901. Under the first Act there were seven classes of ‘‘prohibited immigrants’’, defined mainly in terms of public interest criteria like good health and good character. Section 3(f), however, vested a broad discretion in the government to exclude any immigrant it wished by also defining a prohibited immigrant as anyone who failed a dictation test in any European language. Despite its apparent neutrality, the test, which was administered by customs officers, operated to exclude non-European immigrants (O’Donnell and Mitchell, 2000). The Act also provided for the exclusion of contract or indentured labour generally and without regard for race, subject to a ministerial discretion to admit workers with skills in short supply. The rationale for this exclusion was a longstanding concern to protect Australian workers from unfair competition and foster the development of trade unionism
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(Gollan, 1967). This exclusion was refined after 1905 by the enactment of the Contract Immigrants Act, which allowed for the entry of British labour or those descended from British stock, even where this was not justified on labour market grounds. The legislation also protected domestic labour against strikebreaking and undercutting of wages and conditions set in the arbitrated awards of industrial tribunals. Thereafter, legislative amendments were used to refine the categories of exclusion, particularly in relation to European migrants (O’Donnell and Mitchell, 2000). In order to facilitate the operation of Australia’s post-war immigration program, Assisted Passage agreements were concluded with Britain (1946), Malta, Eire and the International Refugee Organisation (IRO) (1948), The Netherlands and Italy (1951) and West Germany (1952). A general assisted passage scheme for people from the USA, Switzerland, Denmark, Norway, Sweden and Finland was established in 1954. Initially, immigrants were selected on the basis of their suitability for certain kinds of work, particularly in rural areas, nursing and domestic services in hospitals and reconstruction and development projects. O’Donnell and Mitchell (2000, p. 7) note that the agreements with the IRO, The Netherlands, Italy and West Germany were distinguished by the requirement for immigrants to remain in Commonwealthapproved employment for two years. In return for signing an undertaking to that effect, immigrants were given a fixed period landing permit, so that formally this was a species of temporary immigration. Although this was often referred to as ‘‘labour under contract’’, workers were rarely deported on the expiry of their temporary residence permits. An overriding concern in this period continued to be the labour market consequences for local workers, that immigrants should not be in direct competition for jobs nor undercut award rates of pay. After 1952 workers were no longer recruited on a ‘‘contract’’. However the focus remained on filling gaps in the labour market, with executives from the building, shipping, airlines, iron and steel and automotive components industries shaping the migrant intake through their presence on tripartite immigration planning and advisory councils (Lever-Tracy and Quinlan, 1988). In policy terms, the dominant image of this period was of a male worker accompanied by a dependent spouse who would provide the basis for long-term population increase (Fincher et al., 1994). In reality, migrant women tended to have higher labour force participation rates than locally-born females due to both active recruitment of women by some sectors of industry and the economic circumstances of newly arrived families (O’Donnell and Mitchell, 2000). The Immigration Act was replaced by the Migration Act in 1958 and, although not referred to in the legislation, it remained government policy to exclude non-Europeans. The dictation test was abolished and landing permits that were issued at the discretion of the relevant Minister became the basis for entry. During the 1960s, however, there was a gradual erosion of the White
Australia policy that enabled the entry of large number of Asian migrants of mixed descent who were typically English-speaking and Christian. Above we referred to external political pressures which contributed to the demise of a racially based immigration policy, but domestic economic, social and legal developments in the 1970s also rendered this regime of immigration regulation increasingly untenable. Firstly, after 23 years in opposition, a labor government was elected in 1972. It formally ended the White Australia policy the following year and declared that future immigration would ignore race, ethnicity, religious or cultural background. This policy had no immediate effect, as Labor’s election coincided with the onset of recession and the ending of the long post-war boom. This led to a dramatic reduction in demand for unskilled and semi-skilled labour in industries such as manufacturing which had hitherto absorbed much of the migration intake. This effect was exacerbated by other developments such as the government’s determination to develop a Swedish style active labour market policy and a 25 per cent across the board reduction in import tariffs in 1973 (Department of Labour, 1974). Through labour market policy the government sought to lessen Australia’s reliance on immigrants as a source of skilled labour, assist those made redundant as a result of tariff cuts and place emphasis on groups suffering disadvantage and unemployment, such as migrants, women and the disabled (Teicher, 1978). Consequently, governments since the 1970s have made it increasingly difficult for unskilled immigrants to enter Australia, other than on humanitarian or family reunion grounds. In the early 1980s, the emphasis was on targeted migration of skilled workers in areas of identified shortages, but subject to the same types of protection as were previously contained in the Contract Immigrants Act. The focus here was on employer nomination and, while this approach has continued, by the end of the 1980s it was supplemented by more open categories as recommended by the Committee to Advise on Australia’s Immigration Policies in 1988. This involved the introduction of a ‘‘points test’’, under which applicants had to reach a ‘‘pass mark’’ based on criteria such as skill level, possession of credentials recognised in Australia, age and English language proficiency (O’Donnell and Mitchell, 2000). Secondly, the enactment of the Administrative Decisions (Judicial Review) Act, 1977 codified the grounds for review of administrative decisions that had previously resided in the common law. The Act also simplified access to administrative review and vested the Federal Court with jurisdiction to set aside immigration department decisions where there was a procedural flaw in the decision-making process (O’Donnell and Mitchell, 2000). The effect of these changes was that, whereas previously immigration decisions were rarely challenged because they were largely matters of ministerial discretion, they became the second most contested area of administrative decision making after taxation (Crock, 1996). As will be seen below, successive federal governments have responded to the development by limiting the scope for judicial review of
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Figure 2. Proportion of permanent settler arrivals by eligibility criteria, Australia, 1993-1999
administrative decisions by refining and particularising the operation of immigration selection (O’Donnell and Mitchell, 2000). Most immigrants now enter Australia under one of three broad categories: skilled, family reunification or humanitarian. Not only does the government set the annual target for the total number of permanent settlers, it also controls the numbers arriving under the different visa categories, except for New Zealanders, who do not need visas. At the beginning of each year, the Minister for Immigration announces the maximum number of visas to be granted in the first two categories and, where categories have a points test, the pass mark is also announced. Within the skilled stream there are five main categories: independent, employer nomination, skilled Australian sponsored, business skills and distinguished talent. Figure 2 shows that between 1984 and 1997, the highest proportion of settlers arrived under the family reunion program. Policy changes after the 1996 election of a Liberal-National government have shifted the balance more toward skill migration since 1998, with the highest proportion of settlers now arriving under this category. As would be expected, skilled migrant arrivals exhibit the largest fluctuations, in response to changes in economic conditions. This pattern is readily demonstrated in the decline in arrivals following the recessions of 1982-1983 and 1990-1992. The two categories of skilled migration most directly linked to labour market considerations are independent and employer nomination. Independent migrants must satisfy certain threshold requirements relating to ‘‘employability’’, that is, they must fall into a skilled occupational category gazetted by the minister, be less than 45 years old and be proficient in
vocational English. Applicants are then allocated points in terms of their individual attributes. For example, applicants under 29 receive the maximum number of points for age. Bonus points are allocated for considerations such as skills in short supply and bringing in large amounts of capital. Labour market targeting occurs in two ways, the gazetting of occupations and the inclusion of occupations on the Migrant Occupation in Demand List. The second category, employer nomination, allows for entry of highly skilled persons where the employer meets certain conditions. These include demonstrating that there is a shortage of domestic workers who could fill the position, that the employer has an adequate record in training labour, that the job is full time and provides standard wages and working conditions. This emphasis on protecting domestic workers in the employer nomination category demonstrates continuity with the Contract Immigration Act of 1905. However, it is balanced by a concern to attract labour to remote areas, a recognition that short- to medium-term skill shortages emerge and that it may be necessary to import labour in fields utilising new and emerging skills. While formally Australia’s post-war immigration program provided for temporary migration, this was not true in practice. Indeed, unlike many European nations Australia did not resort to the use of ‘‘guestworkers’’ until relatively recently. This category, however, operates primarily to expedite the entry of executives, professionals and other high level staff (Crock, 1996). In 1996, the rules relating to temporary entry of skilled labour were streamlined, providing for a single ‘‘business temporary entry’’ visa with two sub-categories, less than three months and from three months to four years. In order to access the latter sub-category, an employer must be approved as a sponsor and the immigrant applies for a visa on the basis of that sponsorship. Acceptance as a sponsor requires an employer to demonstrate its ‘‘standing’’ in terms of good character, commitment to training Australian residents and ‘‘benefit to Australia’’ in matters such as improving international competitiveness, maintaining or increasing employment for citizens and introducing new or improved skills. If a potential employee is required to perform a ‘‘key activity’’, one central to the employer’s operation, the requirement for labour market testing is waived (O’Donnell and Mitchell, 2000). In this way and through a requirement that nominated employers cooperate with monitoring of their compliance with Australian industrial relations laws, the temporary visa category represents a substantial weakening of the traditional protection provided to domestic workers. 4. Labour market experience of immigrants Given the size of Australia’s immigration intake, information on immigrants’ adjustment into the labour market is crucial for the development and design of future immigration policy and in assessing its effect on the national economy. Fortunately, such information is readily available. For example, two comprehensive surveys on immigration issues, Foster (1996) and Wooden et al. (1994), have substantial sections devoted to the labour market experience of
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immigrants. More recent work has analysed data from the first three waves of the Longitudinal Survey of Immigrants to Australia (LSIA) (Cobb-Clark and Chapman, 1999; VandenHeuvel and Wooden, 1999; Williams et al., 1997). In addition, there are studies focusing on the relationship between visa category and labour force experience (Cobb-Clark, 1999) and the earnings of immigrants (McDonald and Worswick, 1999; Will, 1996). Below we briefly review recent research on the labour market experience of immigrants, focusing on the most important measures: labour force participation rates, employment/unemployment and earnings. The review is supplemented with the descriptive analyses using the most recent data available. Labour force participation rate The participation rates[1] of males born in Australia and from MES and non-MES countries are shown in Figure 3. The downward trend reported by Brooks and Williams (1995) has continued for all three groups. The decline for the non-MES group has been the sharpest, having dropped by 20 per centage points in the period since 1978. In contrast, participation rates of females born in Australia or MES countries have increased substantially over this period, fuelled to a large extent by the growth in part-time work (see Figure 4). Apparently this demand driven effect did not extend to those born in non-MES countries. Moreover, the recessions, especially those that occurred in 1982-1983 and 1990-1992, seem to have had a long-term dampening effect on their participation rate. The relatively lower and declining participation rates for those born in non-MES countries can partly be explained by the following:
Figure 3. Labour force participation rates of males by birthplace, Australia, 1978-2000
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Figure 4. Labour force participation rates of females by birthplace, Australia, 1978-2000
.
.
.
.
participation rates in education and training of the 15-25 age group are higher; changes in the industry and occupational structure of employment has affected this group more than others; population ageing is having a relatively greater affect on these immigrants; and the participation rate of the most recent non-MES arrivals is lower than previously.
Overseas-born youth (aged 15-24), with the exception of those born in Oceania, have higher participation rates in education and training than the Australianborn (ABS, 2000b). The participation rates for those born in Asian and Middle Eastern countries are particularly high. Miller and Volker (1987) contend that parents in non-English-speaking families, whose average educational attainment level is lower than for parents in English speaking families, have higher educational aspirations for their children and place a premium on qualifications and education and training as a way of enhancing their children’s employment prospects. The employment of those born in non-MES countries has traditionally concentrated in industries, such as manufacturing, which have undergone major restructuring and associated job losses in the last couple of decades. In addition, ageing population phenomenom has been more pronounced for this group than for the Australian-born, for example, 14 per cent of non-MES were in the 55-64 age group in 1996, compared to 9 per cent of the Australian-born (ABS, 1996). Older age together with a lack of appropriate qualifications, in particular English language proficiency, has resulted in these people opting out
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Figure 5. Labour force participation rates of male immigrants born in MES countries by year of arrival, 1978-2000
of the labour force completely or becoming ‘‘discouraged job seekers’’ rather than retraining for another job. For example, in 1994 the percentage of those not in the labour force classified as ‘‘discouraged job seekers’’ was 2.6, 3.5 and 3.9 per cent respectively among those born in Australia, MES and non-MES countries (ABS, 1995). Recently arrived immigrants generally have lower participation rates than earlier arrivals. This is to be expected, in view of the challenges of settling into a new social and economic environment and particularly the time taken to gather information about the local labour market. Immigrants arriving under the humanitarian program, some having recently fled from tragic and traumatic situations, face even bigger challenges. Analyses by year-of-arrival cohorts show participation rates of those born in MES countries tend to, in general, reach an ‘‘equilibrium’’ level in a relatively short time (see Figures 5 and 6). The two exceptions are the female 1981-1985 and the male 1996-2000 year-of-arrival cohorts. Similar analyses of those born in non-MES countries show that the corresponding rates are lower than for the other immigrant groups and that they take longer to reach ‘‘equilibrium’’ levels (see Figures 7 and 8). Only the rates for the oldest two year-of-arrival, male cohorts have converged to some sort of ‘‘equilibrium’’ level. The adjustment of the participation rates for females is even slower. These data suggest the ongoing restructuring of the Australian economy has hampered the successful transition into the labour force of more recent arrivals of both sexes from nonMES countries. Numerous studies have modelled the determinants of individual differences in labour force participation utilising human capital theory and multivariate statistical techniques (Ackland, 1992; Baker and Robertson, 1995; Brooks and
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Figure 6. Labour force participation rates of female immigrants born in MES countries by year of arrival, 1978-2000
Figure 7. Labour force participation rates of immigrant males born in non-MES countries by year of arrival, 1978-2000
Volker, 1985; Chiswick and Miller, 1992; Cobb-Clark, 1999; Cobb-Clark and Chapman, 1999; Miller, 1982; Wooden and Robertson, 1989). Apart from small differences in emphasis and scope, in general, these studies conclude that the key determinants of labour force participation by birthplace and sex are age, English language proficiency, pre- and/or post-immigration qualifications, period since arrival and visa category. Cobb-Clark (1999) reports that, although there is little difference in the participation rates by visa category immediately
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Figure 8. Labour force participation rates of female immigrants born in non-MES countries by year of arrival, 1978-2000
after immigration, the participation rate of those admitted under the skilled category was significantly higher than for the other visa categories one year after arrival. Employment and unemployment Figures 9 and 10 show the unemployment rate of immigrants born in non-MES countries has been significantly higher than of the other two groups, with the gap even wider during recession periods. While the gap has varied over time,
Figure 9. Male unemployment rates by birth place, 1978-2000
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Figure 10. Female unemployment rates by birth place, 1978-2000
reaching a maximum around 1994, its existence is further evidence of the difficulty immigrants from non-MES countries have in finding a place in a labour market that has shifted sharply from manufacturing to services and from full time to part time employment. Although part-time employment has become more prevalent among both immigrants and the Australian-born, it tends to be lower among immigrant women, in particular those born in non-MES countries (see Table II). Table III details the industrial distribution of employment by birthplace and assists in understanding the incidence of part-time employment. Immigrants born in non-MES countries were over represented in manufacturing, as in the 1970s, but this group is no longer dominated by migrants from Southern Europe (Teicher, 1978). Manufacturing is one of the last bastions of full-time employment and this goes some way to explaining the low incidence of part time employment among non-MES workers. People born in MES countries are over represented in education, health and community services, while the Australian-born are over represented in wholesale and retail trade. Both areas
Birthplace Australia MES countries Non-MES countries All
Percentage of employment part-time Male Female 1978 2000 1978 2000 5.6 4.4 3.5 5.2
13.1 9.3 13.3 12.7
Source: ABS Labour Force Surveys Cat. No. 6203.0 (various issues)
35.3 34.1 27.1 34.1
44.8 41.0 37.4 43.4
Table II. Part-time employment by sex and birthplace, 1978 and 2000
International Journal of Manpower 23,3 226 Table III. Percentage of employment in major industry sectors by country of birth, 1997
Industry sector
Australia
Agriculture, forestry, fishing and mining Manufacturing Electricity, gas, water supply and construction Wholesale and retail trade Accommodation, cafe´, restaurants, transport and storage Finance, insurance, property, business services, government administration and defence Education, health and community services Cultural, recreational, personal and other services Total
Birthplace MES Non-MES countries countries
6 13 8 21 11 18
3 14 8 18 11 20
3 23 7 17 13 17
16 7 100
20 6 100
16 5 100
Source: ABS (1998)
exhibit high levels of female part-time employment, opportunities that are less likely to be available to females from non-MES countries because of their lower level of English language proficiency. Jobs in education, health and community services demand good verbal and written English communication skills. Table IV shows that a relatively high proportion of workers born in MES countries are professionals. Similarly, intermediate production and transport workers and labourers are over represented among those born in non-MES countries, but intermediate clerical, sales and service workers are under represented because of, once again, the need for higher English language proficiency in these jobs. Previous research focusing on specific occupations, but mainly professions, demonstrates the difficulties faced by recently arrived immigrants born in non-MES countries in practising their profession (Cooper et al., 1996; Hawthorne, 1994; 1997; Jackman, 1995; Kidd and Braun, 1992; Smith, 1994). The key problem is non-recognition of qualifications or barriers to
Industry sector
Table IV. Percentage of employment in major occupation groups by country of birth, 1997
Managers and administrators Professionals Associate professionals Tradespersons and related workers Advanced clerical and service workers Intermediate clerical, sales and service workers Intermediate, production and transport workers Elementary, clerical, sales and service workers Labourers and related workers Total Source: ABS (1998)
Australia
Birthplace MES countries
Non-MES countries
8 17 11 14 4 18 9 11 10 100
8 22 12 14 4 17 8 8 7 100
7 18 10 13 3 14 14 9 13 100
career paths and, to a lesser extent, relatively low English proficiency. Hawthorne (1997) asserts that in relation to recognition of qualifications of overseas-trained doctors the barriers have become higher rather than lower over time, despite a decade of sustained effort by academics and policy makers to procure more positive outcomes. The federal government has used the medical professional bodies’ discriminatory attitudes towards overseas-trained doctors to solve some of its own budgetary problems (to prevent a cost blow out in the publicly funded Medicare health insurance program) by adopting stringent restrictions to curb the inflow of overseas-trained doctors while endorsing the professional bodies’ restrictive pre-registration procedures (Hawthorne, 1997). Hawthorne (1997) also studied the experience of migrant engineers in the labour market and found evidence of employer preference for known ethnic groups, particularly those with English-speaking or European backgrounds. She argues that such preferences have the potential to limit employment opportunities for other migrant groups, especially in times of recessions when downsizing lowers the employer tolerance of perceived applicant ‘‘defects’’ such as inferior English, differences in training, lack of local experience and different job-seeking skills. Earnings Average earnings of immigrants and Australian-born workers differ significantly. In 1999, average weekly earnings of full-time employees were highest for people born in MES countries ($A893) followed by Australian-born ($A744) and non-MES workers ($A721) (ABS, 2000a). There have been numerous studies on determinants of earnings differentials between Australian-born and overseas-born workers (Beggs and Chapman, 1988; 1991; Chapman and Iredale, 1990; Chiswick and Miller, 1985; Kidd, 1993; McDonald and Worswick, 1999; Stromback, 1984; Tran-Nam and Nevile, 1988; Will, 1996). These studies identify period of residence, English language proficiency and qualifications (Australian qualifications more so than overseas ones) as significant in explaining earnings differentials. However, most recently, McDonald and Worswick (1999) have found that the large earnings gap experienced by recent arrivals from non-MES countries is persistent and does not narrow as period of residency increases, but find no evidence of a declining unobserved cohort quality over time. 5. Industrial relations issues Throughout much of the twentieth century, a centralised arbitral model dominated the Australian system of industrial relations. A series of independent tribunals, principally the Australian Industrial Relations commission, regulated wage levels and working conditions through a system of awards. These awards established minimum terms and conditions of employment and were legally binding documents. Their scope was usually an occupation or segment of an occupation, an industry or part of an industry, or,
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less frequently, company-specific. Over time these awards had expanded to cover virtually all conditions of employment. Importantly for immigrant workers, the award covered all employees within the scope of the award, regardless of union status. Once such workers found employment, their terms and conditions could not legally be different to those of Australian-born employees. Accordingly, in industrial relations terms there were two principal issues relevant to immigrants. Firstly, in order to gain access to the award system, there should be no discrimination in getting employment, whether by unions protecting jobs for their existing members or employers exercising indirect discrimination. Secondly, once immigrants found employment, unions should deal fairly and appropriately with issues of concern to those workers. With the gradual move away from the arbitral model that commenced in the late 1980s, a third factor emerged: the ability of immigrant workers and their unions to maintain relative wages and conditions of employment in the evolving system of enterprise based bargaining. This section of the paper examines these three key issues. The focus is on workers from non-MES countries; as Bertone and Griffin (1992, p. 1) note: A number of studies have shown that these members (from MES countries) have easily assimilated into the Australian union movement.
Discrimination Traditionally, trade unions have been a major source of discrimination against immigrant workers and Australian unions have been no exception. Throughout the nineteenth and first half of the twentieth century, union leaders and officials were as susceptible to fears of the ‘‘yellow peril’’ from the north as were their fellow citizens. Many officials were strong supporters of the White Australia policy and only grudgingly assented to the growth of non-British white migration in the post-Second World War period. The main fear of migrants from non-MES countries, especially among craft unions, was that increased migration would lead to depressed labour markets and consequently lower wages (Quinlan, 1989). The upsurge in such migration, allied with other factors, resulted in the quick recruitment of these new workers into trade unions. These factors ranged from the strategic need to ensure that a non-unionised pool of labour was not available to employers in an era when the unemployment rate remained below two per cent and the increasingly bitter fights for control of key unions between the communist and catholic affiliated groups. Further, in 1952, a statutory right to union membership that ‘‘overrode the ethnically discriminatory union rules that prevailed in several Australian unions and (which) had restricted the membership of immigrant workers’’ was introduced into federal legislation (O’Donnell and Mitchell, 2000, p. 21). From the early 1950s, most unions focused on ensuring that immigrant workers from non-MES countries actually became members. The actions of the Federated Ironworkers Association (FIA), a union covering semi-skilled and unskilled workers in the steel industry, are
representative of this union strategy. The union sought and received a guarantee from BHP, the largest steel employer, that it would dismiss immigrant workers who did not join the FIA (Lever-Tracy and Quinlan, 1988). Potential employer discrimination against immigrants was not directly attacked until the 1970s. O’Donnell and Mitchell (2000, p. 27) point to the right of an employer under common law: To hire or not hire whomsoever it chose, giving it the right to exclude individuals from employment on the basis of race, nationality or ethnicity.
The federal jurisdiction moved first, enacting the Racial Discrimination Act in 1975. This legislation was based on the International Convention on the Elimination of All Forms of Racial Discrimination. Over the following years, similar legislation was enacted in all the states and territories. It is, of course, impossible for racial discrimination to be simply legislated away. Discrimination based on race, nationality and ethnicity is now illegal in all jurisdictions and significant penalties apply to breaches of these laws. Immigrant workers and trade unions In August 1999, just over 14 per cent of all Australian union members were born overseas in non-MES countries (ABS, 2000a). This is a decline from the 16 per cent recorded in the early 1990s and reflects decreased immigrant intakes during the decade. Non-MES unionists are concentrated in New South Wales and, particularly, Victoria. In this latter state, the non-MES per centage of union members has remained in the low 20s throughout the 1990s. This sizeable minority raises several issues for trade unions, such as how to deal with and respond to their needs. Martin (1978) identified a number of post war phases of union response to these members. In the first phase, 1948-1954, she argued that a number of unions sought to recruit members simply as part of the bitter internal battles for control of unions; in particular, catholic non-MES workers were recruited avidly by catholic factions warring with communist factions. The second phase, 1955-1964, saw trade unions influenced by the dominant assimilation philosophy in Australian society treat the recruitment and absorption of non-MES workers as essentially the same as that of other workers. During the third phase, 1965-1972, Martin argued that non-MES members within unions started to assert their presence and demand change. For example, this phase saw the emergence of non-MES leaders within unions, particularly at the shop floor level. In the next phase, 1973-1978, external pressures on unions resulted in debates about union levels of services for and responsibilities towards their non-MES members. Over the next 15 years, a number of studies focused on this nexus between unions an non-MES members. Many of these studies were conducted by union activists or social critics, but two large-scale, empirically grounded studies were conducted in New South Wales in 1983-1984 (Nicolaou, 1991) and in Victoria in 1990-1991 (Bertone and Griffin, 1992). These studies identified a number of key issues including the level of services provided by unions for
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their non-MES members, participation of these members both in union officialdom and in general union affairs, attitudes of officials towards non-MES members and of these members towards officials and towards their union and the industrial behaviour of non-MES unionists. During the 1990s, a limited number of smaller scale studies emerged. Cumulatively, over the last two decades of the twentieth century, these studies indicate a gradual improvement in the relationship between unions and non-MES members. There has been a broadening of the range of targeted specialist services for non-MES members, higher levels of non-MES membership participation in union officialdom and improved, more positive attitudes on the part of officials towards these members. The improvements should not be overstated; for example, only a minority of unions provide targeted services and the increased participation tends to come from the more established migrant groups – from southern Europe – than from the more recently arrived groups from Asia. The main determinants of the improvement in the relationship between a union and its non-MES members has been the proportion of these members in the union, attitudes of key leaders and the resource levels of the union. Clearly, higher the proportion of NESB members, the higher is their involvement in the union and greater is the range of specialist services the union has provided. Equally clearly, if union officials can empathise with the problems faced by non-MES members, then it is likely that a better relationship with non-MES members will result. The third factor, level of union resources, has emerged as pivotal during the 1990s. Rapidly declining membership has decimated union resources and is likely to have slowed, if not halted, the gradual improvement noted above. Union density dropped from 40 per cent in 1990 to 25 per cent in 2000. In this climate, unions have been struggling to survive and services and priority issues have changed accordingly. A major factor underlying this struggle for union survival is the move away from the traditional arbitration system premised on encouraging union membership and centralised wage fixing to a nominally deregulated enterprise bargaining system. We now briefly discuss the implications of this system for workers from non-MES countries. Enterprise bargaining In the late 1980s, mainly external economic pressures led to the slow collapse of the traditional macro-level system of industrial relations. This process accelerated in 1991, when the Australian Industrial Relations Commission formally agreed to the introduction of a system of enterprise bargaining. It was completed with the introduction of the Workplace Relations Act 1996, legislation which, as its title proclaims, focused the industrial relations system firmly at the workplace level. In brief, while remnants of the award system survive – mainly as minimum wages and a limited safety net of minimum working conditions – both legally and in practice the emphasis is now very much on bargaining, either individually or collectively at the workplace level.
The move to enterprise bargaining raises a number of concerns for potentially disadvantaged groups, including non-MES workers. Under a centralised wage-fixing system, non-MES workers suffered significant labour market disadvantages, including higher rates of unemployment (Jones and McAllister, 1991), underemployment (Brooks, 1996), vulnerability during restructuring and recession (Ackland and Williams, 1992) and overrepresentation in low status occupations (Davies, 1995) and in menial, repetitive and high-risk jobs (Stephens and Bertone, 1994). What would be the labour market experience of such workers in a deregulated economy? An a priori case could be made that, given the tendency for non-MES workers to be located within more highly unionised industry sectors, these workers would benefit from a move to enterprise bargaining. Conversely, enterprise bargaining contained potential dangers in that it could be expected that more powerful groups would benefit most from the changes and that non-MES workers could be among the ‘‘losers’’. For example, the inferior labour market position of non-MES women workers (particularly in industries such as clothing, footwear and textiles and more generally as discussed earlier) and the lower levels of English language proficiency among this group, make them vulnerable in a bargaining regime. The Industrial Relations Reform Act of 1993, a mid-way point in the development of a more deregulated system, recognised the negative potential of enterprise bargaining for female, youth and immigrant workers from non-MES countries and, seeking to gauge its impact, mandated the federal Department of Industrial Relations to track the impact of the new bargaining system. Its first report presented something of a mixed picture: less non-MES workers received wage increases than did other workers but their average increase was slightly higher and while there was a similar level of consultation among both groups, the use of special consultation provisions, such as document translation, was rare. A key finding was that non-MES workers were significantly less likely to report that they were better off as a result of bargaining than were other workers (DIR, 1995, p. 273). A perceived lack of consultation emerged in the second report which concluded, in carefully phrased words, that: Despite some positive results, the experience of immigrants from non-English speaking backgrounds . . . appears to have been less positive than that of other employees (DIR, 1996, p. 276).
The latest report covers the calendar years 1998 and 1999. The summary of this report concluded: Information has been collated for the reporting period on agreement making and its impact on employees of the designated groups – female, non-English speaking background, young and part-time employees. This information suggests that formalised agreement making has not worked to disadvantage these groups (DEWRSB, 2000, p. 3).
Unlike the earlier reports, this relied solely on an analysis of databases and did not commission any qualitative research. Consequently, it did not evaluate the perceived lack of consultation raised in the second report.
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Consultation and participation of non-MES workers, or more accurately, the lack thereof, emerged as a key issue in a series of six case studies of the impact of enterprise bargaining on non-MES workers. The National Key Centre in Industrial Relations (NKCIR) conducted the case studies in 1996 and 1997 for the then Department of Immigration and Multicultural Affairs. In general, they showed low levels of non-MES worker roles in consultation, participation and overall involvement in the bargaining process; few immigrant-related issues appeared on the bargaining agenda; and there was a lack of knowledge about the bargaining outcomes. Even in the ‘‘best practice’’ case study, where both unions and management made a concerted attempt to involve non-MES workers, some consultation and participation problems were still evident (Griffin and Testi, 1997). Overall, there would appear to be a lower level of involvement by non-MES workers in the process of enterprise bargaining, while the impact of enterprise bargaining on such workers is not homogenous. Some groups of non-MES workers have been advantaged, while others have been disadvantaged, with the difference largely accounted for by their position in the labour market. We noted earlier, however, that such workers suffer more labour market disadvantage than workers born in Australia or in MES countries. The point should also be made that the traditional centralised arbitral system, through its relatively high minimum wages and broad parcel of working conditions, afforded protection to those employees who had not kept apace with improvements in wages and conditions won by some other groups. In this sense, the move to enterprise bargaining has disadvantaged those workers from non-MES countries located in relatively disadvantaged situations. 6. Conclusion In Australia, as in other countries, immigration policy tends to be concerned with two related issues, the appropriate level of migration and the criteria to be used to select among potential migrants. In the second half of the twentieth century, the answers to these questions changed over time, though there was a continuing concern that migration should not harm the employment prospects or undermine the wages and working conditions of Australian residents, whether they be Australian-born or earlier immigrant arrivals. Until the 1970s, migration policy was directed at population growth and economic development. While some attempt was made to select migrants to fill gaps in the domestic labour market, there was no systematic labour market targeting until the 1980s and, particularly, the 1990s. Indeed, humanitarianbased migration was the largest category until the election of a LiberalNational government in 1996. By 1998, that government had shifted the targets decisively in favour of the skills-in-demand category and introduced a new visa category of temporary migration. While temporary migrants could remain in the country for up to four years, there was a lessened emphasis on labour market protection as the government shifted the emphasis to streamlining the admission of people with business and technical skills.
Despite the increasing labour market focus of the Australian migration program, the prevailing evidence suggests that migrants suffer from continuing labour market disadvantage across a range of dimensions, though this phenomena is concentrated among migrants from non-MES countries. Labour force disadvantage is variously evidenced in labour force participation rates, unemployment, occupational and income distribution and earnings. In each of these measures there is strong evidence that the major causal factors are lack of vocational English language skills and lack of appropriate educational qualification. Overlaid on this is the effect of a sustained and major process of economic restructuring which has decisively reduced the employment and income opportunities for some groups of migrants. There is reasonably compelling evidence that this disadvantage has been compounded by the associated process of labour market deregulation and the associated shift to enterprise bargaining. In some cases, this disadvantage appears to have been addressed by exiting the labour market in favour of social welfare. While economic conditions provide a major part of the explanation of the labour market experience of immigrants, there is some evidence of ongoing but subtle discrimination. This is well demonstrated by the case of doctors trained in certain countries, notably non-MES, some of whom cannot obtain registration to practice medicine, despite possessing both appropriate qualifications and English language proficiency. Whether such cases of institutionalised discrimination are isolated is difficult to determine. Similarly, immigrants from non-MES countries have experienced some problems with the trade union movement. Initial pressures towards assimilation were followed by gradual attempts by unions to improve services for their NESB members. The move to a more deregulated labour market, which has placed trade unions under enormous pressure, has probably slowed, and in some cases halted, this improvement. Note 1. The monthly rates for February 1978 to August 2000 were converted to annual rates by averaging over the calendar year. References ABS (1995), Labour Force Australia, February 1995, Cat. No. 6203.0, Australian Bureau of Statistics, Canberra. ABS (1996), Census of Population and Housing: CDADTA96, Australia, Australian Bureau of Statistics, Canberra. ABS (1998), Education and Training Experience, 1997: Confidentialised Unit Record File, Cat. No. 6278.0.30.001, Australian Bureau of Statistics, Canberra. ABS (2000a), Employee Earnings, Benefits and Trade Union Membership, September 1999, Cat. No. 6310.0, Australian Bureau of Statistics, Canberra. ABS (2000b), Participation in Education, September 1999, Cat. No. 6272.0, Australian Bureau of Statistics, Canberra.
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Ackland, R. (1992), ‘‘The determinants of immigrant labour market status’’, paper presented at the Conference of Australian Labour Market Research Workshop, October 17-18, Australian National University, Canberra. Ackland, R. and Williams, L.S. (1992), Immigrants and the Australian Labour Market: The Experience of Three Recessions, Australian Government Publishing Service, Canberra. Baker, M. and Robertson, F. (1995), Qualifications Recognition and Employment Outcomes of Recent Immigrants to Australia: Results from the Prototype Longitudinal Survey of Immigrants to Australia (LSIA), Australian Government Publishing Service, Canberra. Beggs, J.J. and Chapman, B. (1988), ‘‘The international transferability of human capital: immigrant labour market outcomes in Australia’’, in Baker, M. and Miller, P. (Eds), The Economics of Immigration: Proceedings of a Conference at the Australian National University, Australian Government Publishing Service, Canberra. Beggs, J.J. and Chapman, B. (1991), ‘‘Male immigrant wage and unemployment experience in Australia’’, in Abowd, J.M. and Freeman, R.B. (Eds), Immigration Trade and the Labour Market, National Bureau of Economic Research, University of Chicago Press, Chicago, IL. Bertone, S. and Griffin, G. (1992), Immigrant Workers and Trade Unions, Australian Government Publishing Service, Canberra. Brooks, C. (1996), Understanding Immigrants and the Labour Market, Australian Government Publishing Service, Canberra. Brooks, C. and Volker, P. (1985), ‘‘Labour market success and failure: an analysis of the factors leading to the workplace destinations of the Australian population’’, in Volker, P. (Ed.), The Structure and Duration of Unemployment in Australia: Proceedings of a Conference, 4-5 August 1983, BLMR Monograph Series No. 6 Australian Government Publishing Service, Canberra. Brooks, C. and Williams, L.S. (1995), Immigrants and the Labour Market: The 1990-94 Recession and the Recovery in Perspective, Australian Government Publishing Service, Canberra. Chapman, B. and Iredale, R. (1990), Immigrant Qualifications: Recognition and Relative Wage Outcomes, Office of Multicultural Affairs, Canberra. Chiswick, B. and Miller, P. (1985), ‘‘Immigration generation and income in Australia’’, Economic Record, Vol. 61, pp. 540-53. Chiswick, B. and Miller, P. (1992), Post-Immigration Qualifications in Australia: Determinants and Consequences, Australian Government Publishing Service, Canberra. Cobb-Clark, D. (1999), Do Selection Criteria Make a Difference? Visa Category and the Labour Force Status of Australian Immigrants, Centre for Economic Policy Research Discussion Paper No. 397, Australian National University, Canberra. Cobb-Clark, D. and Chapman, B. (1999), The Changing Pattern of Immigrants’ Labour Market Experiences, Centre for Economic Policy Research Discussion Paper No. 396, Australian National University, Canberra. Collins, J. (1988), Migrant Hands in a Distant Land, Australia’s Post-War Immigration, Pluto Press, Sydney. Committee to Advise on Policies for Manufacturing Industry (1976), Policies for the Development of Manufacturing Industry, A Green Paper, Jackson Report, Vol. 4, Australian Government Publishing Service, Canberra. Cooper, B.J., Leung, P. and Cahill, D. (1996), Employment Experiences of Immigrant Accountants in Australia, Australian Government Publishing Service, Canberra. Crock, M. (1996), ‘‘Judicial review and part 8 of the Migration Act: necessary reform or overkill’’, Sydney Law Review, Vol. 18, pp. 267-307.
Davies, M. (1995), ‘‘Making reform work for all workers’’, in National Training Reform and NESB Workers, Seminar Proceedings, Office of Multicultural Affairs, Australian Government Publishing Service, Canberra. DEWRSB (2000), Agreement Making in Australia under the Workplace Relations Act (Executive Summary), Department of Employment Workplace Relations and Small Business, available at: www.dewrsb.gov.au/workplaceRelations/publications/aggreementMaking/ 1998_99report.htm (accessed September 2000). Department of Labour (1974), Australian Labour Market Training: Report of the Committee of Inquiry into Labour Market Training, Australian Government Publishing Service, Canberra. DIR (Department of Industrial Relations) (1995), Enterprise Bargaining in Australia: 1994 Annual Report, Australian Government Publishing Service, Canberra. DIR (Department of Industrial Relations) (1996), Enterprise Bargaining in Australia: 1995 Annual Report, Australian Government Publishing Service, Canberra. Fincher, R., Foster, L. and Wilmot, R. (1994), Gender Equity and Australian Immigration Policy, Australian Government Publishing Service, Canberra. Foster, W. (1996), Immigration and Australian Economy, Department of Immigration and Multicultural Affairs, Australian Government Publishing Service, Canberra. Gollan, R. (1967), Radical and Working Class Politics, Melbourne University Press, Melbourne. Griffin, G. and Testi, J. (1997), ‘‘Immigrant workers and enterprise bargaining’’, Journal of Intercultural Studies, Vol. 18, pp. 109-125. Hawthorne, L. (1994), Labour Market Barriers for Immigrant Engineers in Australia, Australian Government Publishing Service, Canberra. Hawthorne, L. (1997), ‘‘The question of discrimination: skilled migrants’ access to Australian employment’’, International Migration, Vol. 35, pp. 395-417. Jackman, R. (1995), ‘‘Employment problems for non-English-speaking-background professionals’’, People and Place, Vol. 3, pp. 40-6. Jones, R. and McAllister, I. (1991), Immigrant Unemployment and the Labour Market Programs, Australian Government Publishing Service, Canberra. Jupp, J. (1998), Immigration, Oxford University Press, Melbourne. Kidd, M. (1993), ‘‘Immigrant wage differentials and the role of self-employment in Australia’’, Australian Economic Papers, Vol. 32, pp. 92-115. Kidd, M. and Braun, F. (1992), Problems Encountered by Overseas-trained Doctors Migrating to Australia, Australian Government Publishing Service, Canberra. Lever-Tracy, C. and Quinlan, M. (1988), A Divided Working Class: Ethnic Segmentation and Industrial Conflict in Australia, Routledge, London. McDonald, T. and Worswick, C. (1999), ‘‘The earnings of immigrant men in Australia: assimilation, cohort effects and macroeconomic conditions’’, The Economic Record, Vol. 75, pp. 49-62. Martin, J.I. (1978), The Migrant Presence, Australian Responses 1947-1977, Allen and Unwin, Sydney. Miller, P. (1982), ‘‘The economic position of migrants: facts and fallacies – a preliminary view’’, Australian Bulletin of Labour, Vol. 8, pp. 229-48. Miller, P. and Volker, P. (1987), The Youth Labour Market in Australia: A Survey of Issues and Evidence, Centre for Economic Policy Research Discussion Paper No. 171, Australian National University, Canberra. Nicolaou, L. (1991), Australian Unions and Immigrant Workers, Allen and Unwin, Sydney.
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O’Donnell, A. and Mitchell, R. (2000), ‘‘Immigrant labour in Australia: the regulatory framework’’, Centre for Employment and Labour Relations Law, Working Paper No. 20, University of Melbourne. Quinlan, M. (1989), ‘‘Unions and immigrants: the post Second World War experience’’, in Ford, B. and Plowman, D. (Eds), Australian Unions, an Industrial Relations Perspective, Macmillan, Melbourne. Smith, T.F. (1994), ‘‘The employment situation of migrant professionals holding tertiary qualifications’’, People and Place, Vol. 2, pp. 13-18. Stephens, J. and Bertone, S. (1994), Manufacturing Uncertainty: Non-English Speaking Background Women and Training, Australian Government Publishing Service, Canberra. Stromback, T. (1984), ‘‘The earnings of migrants in Australia’’, paper presented at the Conference of Bureau of Labour Market Research, Canberra. Teicher, J. (1978), ‘‘Labour market policy for disadvantaged workers – the relevance of overseas experience to Australian practice’’, unpublished Master of Economics thesis, Monash University, Melbourne. Tran-Nam, B. and Nevile, J.W. (1988), ‘‘The effects of birthplace on male earnings in Australia’’, Australian Economic Papers, Vol. 27, pp. 83-101. VandenHeuvel, A. and Wooden, M. (1999), New Settlers Have Their Say – How Immigrants Fare Over the Early Years of Settlement, Department of Immigration and Multicultural Affairs, Canberra. Will, L. (1996), Immigrant Earnings Change: The Importance of Australian Schooling, Centre for Economic Policy Research Discussion Paper No. 340, Australian National University, Canberra. Williams, L.S., Murphy, J. and Brooks, C. (1997), Initial Labour Market Experiences of Immigrants, Department of Immigration and Multicultural Affairs, Canberra. Wooden, M. and Robertson, F. (1989), The Factors Associated with Migrant Labour Market Status, Bureau of Immigration Research, Melbourne. Wooden, M., Holton, R., Hugo, G. and Sloan, J. (1994), Australian Immigration: A Survey of the Issues, 2nd ed., Australian Government Publishing Service, Canberra.
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Employment equity in South Africa: lessons from the global school Ade`le Thomas
Employment equity in South Africa 237
Graduate School of Business Administration, University of the Witwatersrand, Johannesburg, South Africa Keywords South Africa, Employment law, Affirmative action, Equal opportunities Abstract South African companies employing 50 or more employees or those with a specified financial turnover, are required to comply with the provisions of the newly introduced Employment Equity Act. Prior to the introduction of the Act, large companies in the country had already introduced strategies of affirmative action to achieve employment equity. This paper highlights some of the strategic and operational concerns surrounding employment equity legislation in South Africa and reviews broad practices of employment equity in Malaysia, India, the USA, Canada, Britain and Zimbabwe. Lessons for the effective implementation of employment equity in South Africa are identified.
Introduction The Employment Equity Act No. 55 of 1998 (Republic of South Africa, 1998a) aims to ensure that the legacies of apartheid in the South African workplace are redressed. In this regard, employment equity will, over time, be achieved by promoting equal opportunity and fair treatment through the elimination of unfair discrimination and through the implementation of affirmative action measures to advance black people, women and people with disabilities (referred to as designated groups). The act defines black people as Africans, Coloureds (mixed race) and Indians[1]. In this pursuit, the Employment Equity Act endeavours to ensure the equitable representation of people from designated groups in all occupational categories and levels in the workforce. The South African Department of Labour has furnished data relating to the geographical spread of the economically active population according to race, gender and disability. It is against these figures that employers of over 50 employees and those with certain defined financial turnovers are required to address target setting and related strategies of recruitment, training, development and retention of people from designated groups. In essence, employment equity focuses on a broad view of the end result. Measures of affirmative action will need to be adopted by employers, in order to ensure that this broad objective is achieved. The rationale for employment equity At a company level, the face of the South African workplace is becoming more diverse, although it may be argued that this process is not occurring rapidly enough. Through programmes of affirmative action (often previously called in
International Journal of Manpower, Vol. 23 No. 3, 2002, pp. 237-255. # MCB UP Limited, 0143-7720 DOI 10.1108/01437720210432211
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South Africa, black advancement programmes, equal opportunity programmes, corrective action programmes, amongst others), employers have made efforts since the early 1990s to include, in management structures, people from historically disadvantaged backgrounds who were previously denied such access (Thomas, 1996). While some progress has been made in this area, management structures, however, are still the domain of white males. Figures provided in 1997 (Breakwater Monitor, 1997) of 99 companies employing, in total, 651,000 employees indicated that top managerial ranks of companies (Paterson F Grade) comprised 6.15 per cent blacks, 0.36 per cent Coloureds, 0.90 per cent Asians[2], while whites constituted 92.59 per cent. This was in sharp contrast to the lowest level (Paterson A Grade) where the equivalent statistics were 88.47 per cent, 8.25 per cent, 1.29 per cent and 1.99 per cent respectively. In July 1998, a continuation of this study (Breakwater Monitor, 1998) reported that 87 per cent of private sector management is white, 93 per cent of executive managers are white, 92 per cent of senior managers are white, six per cent of all managers are black (African) and only 14 per cent of managers are women, of whom 77 per cent are white. A survey of 455 South African businesses has recently revealed that black employees comprise 11 per cent of senior management structures, of which one per cent comprise black women (Department of Labour, 1998a). In detailing various forms of discrimination and disadvantage in the South African labour market, the Department of Labour (1999) highlights the following: .
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whites are estimated to evidence a 104 per cent wage premium over Africans; men are estimated to earn wages 43 per cent higher than similarly qualified women in similar sectors and occupations; black women (African, Coloured and Indian) in the lower educational categories earn a 10 per cent lower salary than their white male counterparts with similar education credentials; and black men (African, Coloured and Indian) at this level of education have incomes that average 25 per cent of white male incomes for the same level of education.
Strategic concerns The legislation of employment equity in South Africa has not been without criticism from business leaders. On a macro-level, the following concerns have been articulated: .
The over-regulation of the labour market, coupled with the government’s role of ‘‘watchdog’’, will result in a decrease in overseas investments and in entrepreneurial initiatives, especially in the medium and small business sectors, which together contribute nearly 33 per cent
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of GDP and nearly 45 per cent of private sector employment (Dickman, 1998). The costs to government, and hence the taxpayer, will be increased by the administrative burden of monitoring and enforcement, and legal structures will be overburdened and unable to cope with the cases where legal rulings will be required. Heavy administrative costs in the private sector relating to compliance with the legislation will impact on company growth and accordingly, upon optimal growth in the private sector (Dickman, 1998; Jafta, 1998). The shortage of skills in some sectors will make black skills more expensive and unaffordable to smaller companies, further providing disincentives for investment and expansion. Rather than creating new jobs for new entrants to the labour market, employees will simply be shifted from some employers to others (Jafta, 1998). Indirect and opportunity costs will be incurred by, for example, poor hiring decisions (to reach employee targets), and the declining morale of (white) employees (Jafta, 1998). Race classification will be heightened and ‘‘reverse discrimination’’ will lead to a decrease in employee loyalty and the lack of retention of skilled employees, primarily white males. Such racial classification, Jafta (1998, p. 5) notes, incurs a social cost by reinforcing ‘‘negative stereotypes, racial tension and a stigmatisation that thwarts the efforts of members of the preferred groups to pursue their goals on merit and hard work rather than preferential treatment’’. Those people from designated groups who still require training and development will have unrealistic short-term expectations that will further increase racial and social conflict within companies. Those from designated groups, expecting secured positions, may adopt a culture of entitlement ‘‘that undermines initiative, self-confidence and self-reliance’’ (Jafta, 1998, p. 5).
These arguments cannot simply be disregarded, as such problems have been noted in other countries where employment equity initiatives have been adopted for many years (Be´teille, 1993; Fernandez, 1997; Puthucheary, 1993; Samarasinghe, 1993). Operational concerns Adding to the aforementioned problems, the South African workplace is characterised by adversarial relationships, lack of trust and communication between individuals and groups, poor teamwork, apparent absence of employee commitment and motivation to organisational goals, high staff turnover, especially amongst those from designated groups, industrial
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conflict and low levels of productivity, profitability, quality and customer service (Adams, 1993; Christie, 1996; Douwes Dekker, 1993; Thomas, 1996). A recent South African study (Thomas, 2000) has highlighted that, while black managers may leave companies for higher salaries and related perks, issues relating to not fitting into historically established corporate cultures seem also to have a bearing on what has become known derogatorily as ‘‘job hopping’’. In support of these observations, a survey conducted by International Survey Research (Business Times, 1997) amongst approximately 23,000 South African employees, found that negative attitudes have increased sharply since 1994. Commenting on this finding, Hofmeyr (Business Times, 1997, p. 2) notes that: If morale is low and perceptions of management are poor, it is unlikely that we will obtain high productivity. There is a positive correlation between high performing countries internationally and positive attitudes of employees and managers.
The economic costs of not fully utilising all employees in corporations, as evidenced by absenteeism, staff turnover, poor morale, under-performance and sub-optimal customer service has been noted by Cox (1993), Cox and Blake (1991), Morrison (1992), Odom et al. (1990) and Thomas and Ely (1996). International research further indicates that when employees, not formerly part of established organisational cultures, are introduced into such environments, problems may occur. Tsui et al. (1992) found that individuals who are racially and ethnically different from others in their work units tend to be less psychologically committed to their organisations, less inclined to stay with the organisation and more likely to be absent. Greenhaus et al. (1990) note that blacks in the USA tend to be less satisfied with their careers than whites, and also perceive themselves to be less accepted by their organisations and to have less discretion than whites in the same organisations. These themes appear to underlie a common perception of possible exclusion within historically established corporate cultures of organisations. At an operational level, the following problems appear to have surfaced in the fledgling stage of the introduction of affirmative action strategies in South Africa (BMF, 1993; Thomas, 1996): . In the quest to appear acceptable in terms of race and gender, token appointments of people lacking the necessary skills have been made. This has led to a decline in service levels, people being given meaningless jobs and the attendant costs to business. . There is a prevalence of negative expectations about candidates from designated groups, heightened scrutiny of them, fears and resentments on the part of those who stand to lose promotional opportunities and the resultant overt and covert sabotage of the process, for example, by the withholding of information and by the exclusion of members of designated groups from formal and informal networks and systems that assist in job progress.
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Employment equity and affirmative action measures have not been regarded as strategic business issues and accordingly, there has been a lack of management commitment to this process at all levels in companies. Rather, the task of achieving employment equity has been delegated to the human resources departments of large corporations that seldom have the authority or necessary mechanisms to ensure progress. No business imperative has been identified by management with regard to the competitive advantage that a diverse workforce can afford. Rather, the diversity created by strategies to achieve employment equity has been regarded as a response to moral or legal compliance issues and, accordingly, as a ‘‘necessary evil’’ with which business has to contend. Performance management, as a means to training and developing people from designated groups into fully productive employees, has been poor, especially in the areas of managerial commitment to performance management, the recognition of potential and non-traditional skills, mentoring and coaching and career planning. Informal networks, functional in promotions and advancement, exist in the South African workplace, coupled to which new recruits are expected to assimilate to prevailing corporate cultures.
The reality is, however, that South African companies are required to comply with employment equity legislation. Accordingly, it is suggested that, with due recognition of the concerns noted above, energy and focus should now be placed upon a concerted effort to ensure that employment equity initiatives are implemented in an holistic manner that is of benefit to both employees and to companies. It is with this aim in mind that international practices in the implementation of employment equity may provide valuable lessons for South Africa, at both strategic and operational levels. Global competitiveness The demise of formal policies and structures of apartheid and the inception of the Government of National Unity in 1994 has resulted in South Africa emerging from a position of relative isolation to a position where it now has to compete in the global marketplace. When considering the competitive position of the country, at this point, indicators of competitiveness are not encouraging. The World Competitiveness Yearbook (IMD, 1999) indicates that South Africa has lagged in 42nd place for two consecutive years in the ranking of competitiveness among 47 industrialised nations and has occupied the last place (one position worse than in 1998) in terms of ‘‘people rating’’. The uncompetitive nature of South African business (McGowan, 1993; Gebhart, 1994; Schlemmer and Hirschfeld, 1994) is manifested in, amongst other indicators, high unemployment rates, a low gross domestic product growth and limited industrial expansion (Ogden, 1996).
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It can be argued, therefore, that one of the foremost challenges that South Africa faces is that of becoming globally competitive. It can further be argued that employment equity legislation and the resultant strategies upon which companies embark, will change the composition of the workforce and that it is critical that the workforce of the future is one that is productive and contributes towards the global success of South Africa. Indeed, it is this new workforce, characterised by an array of diverse groups, that needs to be leveraged for competitive advantage in the quest to combine the best management practices employed successfully elsewhere in the world with the strengths that are unique in the people of South Africa. In support of this argument, the Japanese example of combining international best practices with local cultural characteristics has been indicated to positively impact upon productivity and competitive advantage (Womack et al., 1991). Internationally, Cox (1993), Lattimer (1994), Morrison (1992) and Thomas (1991), have documented the benefits to business of employee diversity that may include: . tapping into skills not previously available in a company characterised by an homogeneous workforce; . enhancing company creativity and problem solving; responding quickly and effectively to diverse markets and managing productive relationships with diverse customers, suppliers and distributors; . promoting a culture of inclusivity, critical to a commitment to total quality; . enhancing team performance; and . attracting and retaining the best talent, especially amongst those representing new consumer markets. Thomas and Ely (1996) also note that diversity encourages different and creative insights and styles in approaching the design of business processes and tasks, in the achievement of goals, in the creation of effective teams and in the communication of ideas, amongst others. Cox et al. (1991) note the tendency towards more co-operative choices amongst ethnically diverse groups than amongst all-Anglo groups and McLeod and Lobel (1992) report that ethnically heterogeneous groups produce higher quality ideas in brainstorming activities than do homogeneous groups, a finding supported by Watson et al. (1993). Positive results relating top management team diversity to corporate performance and strategic decision making have also been reported by Bantel and Jackson (1989), Glick et al. (1993) and Wiersema and Bantel (1992). Affirmative action strategies in selected countries Affirmative action strategies to achieve employment equity have been operationalised, over the years, in countries such as Malaysia, India, Canada, the USA, Britain and Zimbabwe. While, with the exceptions of Malaysia and Zimbabwe, such strategies have been directed at affirming minority groups, the practices evident in all these countries, with both positive and negative
aspects, provide learning points for South Africa. In this section of the paper, these practices of selected countries will be examined and broad lessons later will be drawn upon that could provide guidelines for the effective implementation of employment equity in South Africa. Malaysia The study of affirmative action strategies in Malaysia is perhaps of prime interest to South Africa in that, as noted by Castle (1995), Charlton and van Niekerk, (1994), Emsley (1996) and Thompson (1993), parallels exist between the two countries: affirmative action is designed to benefit the majority of the population and religious differences in Malaysia broadly coincide with the ethnic differences encountered in South Africa. Puthucheary (1993) and Weiner (1993) note that post independence in 1957, citizenship for Chinese and Indians was granted in return for constitutional preferential treatment for the Malays. However, the indigenous Malay community remained economically disadvantaged, threatening unity and national stability. The New Economic Policy (NEP), introduced in 1971 in favour of the indigenous Malays, aimed at reducing and eventually eradicating poverty and restructuring society to eliminate the association of race with economic standing (BMF, 1993; Emsley, 1996). The ultimate objective of this policy was the promotion of national unity and social integration. Largely, through the implementation of quotas at universities, in government and parastatal organisations and in the ownership of enterprises and new businesses, Malays now constitute approximately 67 to 75 per cent of university students (BMF, 1993; Puthucheary, 1993), own 66 per cent of corporate assets (Thompson, 1993) and have moved from agriculture into manufacturing, trade and the civil service (Thompson, 1993). Puthucheary (1993) states that this policy has resulted in the emergence of a Malay middle class and Emsley (1996) and Jain (2000) note that the GDP of Malaysia has grown at a rate of 6 to 7 per cent over the past two decades, with a significant reduction in poverty. Puthucheary (1993) and Emsley (1996) further note that while some resentment did exist among non-Malays with regard to the NEP, the agreement within the governing alliance of the country was that the Chinese could still retain the ability to create wealth while the administration that pursued economic growth policies would be run by the Malays. Puthucheary (1993) attributes much of this success to the flexible approach adopted by the government in implementing these policies. However, affirmative action in Malaysia has not been implemented without attendant problems. Thompson (1993) warns that quotas have resulted in non-Malay students leaving the country to study abroad and the continued ownership of wealth by the Chinese and Indians who operate businesses run by Malay ‘‘front men’’. This has resulted in an elite Malay group benefiting from affirmative action, with less benefit occurring to the poorest sectors of disadvantaged groups, a finding also noted by Castle (1995) and Jain (2000). Jain (2000) further reports that a system of rigid quotas can permanently entrench affirmative action strategies that may eventually serve only the interests of a minority.
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India The Constitution of India, adopted in 1950, specifically provides that positive measures, in the form of reservations or quotas in education and employment in the government and public sector, are adopted to advance members of scheduled castes (the untouchables) and scheduled tribes (those isolated in remote areas). Jain and Ratnam (1994) report that in 1990 the government also introduced additional reservations for ‘‘other backward classes’’ and adopted a quota of 27 per cent for this group, in addition to the 22.5 per cent quota provided for the scheduled castes and scheduled tribes (Ratnam and Chandra, 1996). Jain (2000) notes that the Supreme Court decided that reservations for all three groups should not exceed 50 per cent, and that candidates for appointment should meet eligibility requirements, in order to ensure administrative efficiency. In addition, certain categories of occupation (such as defense personnel, research and medical scientists and university professors) are exempt from the reservation of appointments (Jain, 2000). Here, as in South Africa, the legislation aims to redress historical inequalities and has been coupled to programmes of land reform that address the same objective (Charlton and van Niekerk, 1994). The widespread poverty in India and the numbers of people who can, therefore, benefit from the legislation, according to Thompson (1993), has made it beneficial to be classified as a member of a scheduled caste or tribe, or a member of another backward community. Gains have been evident, over the years, in the most disadvantaged sectors of Indian society, especially in the areas of literacy and elementary and secondary education (Ratnam and Chandra, 1996), proportionate representation in professional and managerial positions (Jain and Ratnam, 1994) and a growing middle class of scheduled castes and scheduled tribes (Jain, 2000). However, the criticisms leveled at the affirmative action policy of India centre around the following issues: not reaching the most deserving individuals in the country (Be´teille, 1993); the government practice of implementing quotas that lead to resentment and the lowering of standards (Be´teille, 1993); political parties using the promise of raising reservation quotas, for example, to embrace various religious groups, for lobbying purposes (Ratnam and Chandra, 1996); and the domination in public departments of people belonging to a particular caste or region (Ratnam and Chandra, 1996). Jain (2000) further notes that progress has also generally been slow on account of the low economic growth rate between 1950 and 1990, with the attendant lack of resources for expansion in education and other social services. Canada Three major categories of responses have been forthcoming in Canada to improve the status of designated groups, defined as women, ethnic minorities, aboriginals and people with disabilities, as noted by Jain (2000). The first category of response was that encapsulated in human rights legislation and the constitution that prohibits all forms of unfair discrimination in all government agencies. The second category of response was the enactment of employment
equity legislation in 1986, amended in October 1995, directed at federal government agencies and employers in the banking, transportation and communications sectors. The third category of response has been the introduction of administrative policy (as opposed to legislation) that requires organisations with 100 or more employees who bid on federal government contracts of $200,000 or more to effect employment equity programmes. Such programmes require the removal of barriers encountered by the four designated groups in the areas of selection, hiring, promotion and training; and the setting of specific goals and timetables for the introduction and progression of people from designated groups within these organisations. These responses do not impose quotas of any kind on employers, and, as noted by Agocs and Burr (1996), have considered factors such as the availability of qualified candidates and other factors governing the establishment of positive measures and targets. Jain (2000) notes that since the enactment of the federal Employment Equity Act in 1986, progress has been slow, with the communications sector being the only one approximating the representation of women within the context of the broader demographic landscape and none of the three sectors evidencing representation of aboriginals or people with disabilities. While the representation of visible minorities has improved, especially within the banking sector, it is still below the external availability in the transportation and communications sectors. Leck and Saunders (1992) further argue that the Canadian policy has increased the hiring of white able-bodied women at the expense of addressing discriminatory practices relating to racial minority women. Agocs and Burr (1996) note that one of the reasons for this slow progress in Canada is that 1986 legislation required only the submission by employers of reports detailing numerical representation, with a lack of attention to the identification and change of discriminatory organisational policies and practices that are embedded in the organisational culture. Lum (1995) and Poole and Rebick (1993) continue this argument by highlighting that the slow progress and the disappointing results thus far are a function of the government not playing an effective monitoring and compliance role. With time, greater progress may be seen with the implementation, in 1995, of the amended Act. This revised federal Act requires that employers demonstrate how they intend to comply with their employment equity plans, gives a compliance and enforcement role to the Canadian Human Rights Commission and binds unions, employees and the management of the company together in ensuring the implementation of an employment equity plan. This broader approach now includes a focus upon barriers to employment equity, organisational culture and systemic discrimination, and organisational policies and practices, in addition to numerical target setting. The USA In the USA, the term ‘‘affirmative action’’, directed at the black minority in the country, first appeared in Title VII of the Civil Rights Act of 1964 (Days, 1993).
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This statute covers both private and public sector employers of 15 or more employees and has been extended to include other minority groups. In 1965 all federal contractors were required to implement affirmative action strategies enforced through federal regulation, as opposed to affirmative action legislation. Federal contractors were required to perform administrative functions relating to the reporting on workforce composition and the setting of goals and timetables for hiring, in order to improve the representation of the workforce (Agcos and Burr, 1996). Such regulation of federal contractors, Jain (1999) notes, covers 75 per cent of the US workforce and has resulted in higher earnings, occupational upgrading and higher representation across occupations for women and minorities over the years in both the public and private sectors. Other regulatory procedures have also influenced employers to adopt strategies of affirmative action to prevent unfair discrimination, most notably civil rights complaints and costly settlements in terms of race and gender discrimination (Acgos and Burr, 1996). Agcos and Burr (1996), Johnson (1997) and Lattimer (1994) note the progress that has been made in the representation of formerly disadvantaged groups in the US workplace. However, affirmative action in the USA has not been without its problems. Roberts (1997) notes that the focus of affirmative action has been on numbers, with no due regard being paid to training and development of selected candidates, leading to little investment in human capital. However, even with this apparent success, almost half the states in the USA are moving to abolish affirmative action due to a view that, after 30 years, this policy has become counter-productive and has outlived its usefulness (Johnson, 1997). Britain In Britain, various legislation and related policies were adopted by the Department of Employment and other public agencies during the 1970s, to ensure employment equity for women, people with disabilities and minority groups (most notably, Indians and West Indians) who were previously discriminated against in the workplace (Naidoo, 1997). With regard to minorities, Naidoo (1997) notes that discrimination in Britain has been associated with racial rather than with foreign origin and that subsequent programmes of employment equity have shifted from focusing on overt discrimination to that of the removal of barriers in education, training and usual occupations for women and minorities. Separate legislation in Britain covers gender, race, disability, and discrimination against persons with criminal convictions. The Department of Employment has set out the following major conditions with regard to employment equity policy: .
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agreed measures with employee representatives to promote employment equity; a duty for management, at all senior levels, to be associated with employment equity policy;
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supervision of the implementation of such policies within companies; and regular feedback to senior management on the efficacy of such policy.
Assistance to companies in the implementation of strategies to achieve employment equity is also afforded by the Department of Education, the Institute of Personnel Management, and the Industrial Society. In 1997 the Employment Opportunities Commission was also set up to investigate issues related to discrimination in the workplace. The commission formulated a code of practice to assist employers in implementing ‘‘best practice’’ as it relates to employment equity, particularly in the areas of regular monitoring of recruitment, promotion, training and development and the diversity spread of employees within occupational categories and departments. The Commission for Racial Equality also introduced a Race Relations Code in 1984 that encourages, but does not require, ethnic monitoring. However, Naidoo (1997) notes that little has changed in Britain, as employers are not required to adhere to the codes of practice and would only be sanctioned if the employer is found to be guilty of discrimination and has made no effort to comply with the code. The lack of enforced compliance, which has shaped labour market policy, is based upon the post-war British ‘‘principle of voluntarism’’ the foundation of which is that collective agreements are more likely to be implemented if they are agreed to by the parties themselves without outside interference. Legislation in Britain can be considered to be fragmentary and confusing. Zimbabwe In Zimbabwe, no explicit legislation regarding employment equity exists. However, the Africanisation of the civil service has been a political imperative since 1980 (BMF, 1993; Strachan; 1993). This imperative requires that black Zimbabweans be appointed, particularly in middle and senior management positions. Strachan (1993) notes that after independence in Zimbabwe, there was a reluctance on the part of the private sector to accept the need to redress the historical discrimination of the past and that it took approximately eight years for the public debate for black advancement to emerge. One of the foremost reasons for this lag was the connotations associated with the word ‘‘Africanisation’’, as white Zimbabweans viewed themselves as being as African as their black fellow citizens. The term ‘‘black advancement’’ was, therefore, substituted for the word ‘‘Africanisation’’. Strachan (1993) notes a fair degree of success in achieving greater representation of black Zimbabweans in the public, parastatal, and even private sectors, the latter being largely due to the securing of government contracts. However, Gatherer and Erickson (1993) highlight the practice of blacks being appointed in companies into personnel and public affairs positions, in order to perform a strategic liaison function between companies and government. In line with this practice, Gatherer and Erickson (1993) note the apparent lack of management commitment to true black advancement.
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They further note that greater strides in black advancement have been made by those companies where there has been a concerted effort and sustained commitment by top managers and boards to developing blacks into a range of managerial positions. While the BMF (1993) cite Zimbabwe as a success story in that the civil service has changed from being all white in 1980 to 95 per cent black in 1993, Castle (1995) argues that the associated costs have been an increase in the number of civil servants and a sharp decline in efficiency. Bennell and Strachan (1992) and Gatherer and Erickson (1993) note the nepotism, tribalism, fraud and corruption that has resulted from this practice. It can also be argued that the Zimbabwean practice has benefited the most advantaged of a disadvantaged majority who are upwardly mobile and highly vocal, with little advantage being afforded to the majority of the population. Castle (1995) notes, too, that the lack of expansion of the Zimbabwean economy has resulted in the unavailability of suitable jobs for school-leavers, with attendant political costs. Lessons from the global classroom A number of lessons from practices in the selected countries discussed, can be drawn upon to address the optimal implementation of employment equity in the South African context. Some of the issues that emerge as lessons for South Africa to draw upon, have already been addressed by the South African Department of Labour and, at an operational level, by some South African companies. However, it is argued, that, particularly at operational levels, certain aspects of implementation warrant ongoing concern. From the countries discussed, the following emerge as major areas that warrant attention: . Unlike in India, the relative success that the implementation of employment equity has enjoyed in Malaysia, argue Charlton and van Niekerk (1994), is due to the relative political stability in the country coupled to which there has been economic growth. The aforementioned problems related to the uncompetitive nature of South Africa, its low growth rate, high level of unemployment and political unrest are all factors that mitigate against the effective implementation of employment equity. Horwitz et al. (1996) report that since 1981 the South African economy has averaged a one per cent real growth in GDP while the population has increased annually by an average of 2.5 per cent. Official figures of unemployment stand at approximately 26 per cent (Horwitz et al., 1996). The lack of job creation has, in many cases, resulted in white males subtly sabotaging progress towards employment equity for designated groups as a response to the protection of promotional opportunities that have thus far favoured a white minority. Regular strike action evident in the country has also contributed to a lack of economic growth and international investment has been hampered by political uncertainty and escalating crime rates. While there are not easy solutions to these broader macro issues, it is argued that the addressing of historical inequalities in the workplace
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would be facilitated if all citizens of the country could envisage an inclusive future in an expanding business domain. A plethora of labour legislation exists in the country that governs unfair discrimination and regulates fair employment practices. The most notable of these Acts are the Labour Relations Act (Republic of South Africa, 1995), the Basic Conditions of Employment Act (Republic of South Africa, 1997) and the Skills Development Act (Republic of South Africa, 1998b). Employers have expressed concern regarding the stringent legislative requirements within which companies are compelled to operate. However, unlike in Britain, a single Act governs practices relating to employment equity. To some degree, South Africa appears to have learned from the British experience that a multiplicity of legislation dealing with employment equity is confusing and unlikely to be adhered to, due to the gaps and loopholes that tend to exist when separate Acts govern different beneficiaries or areas of practice. From the experiences in India, the South African government did apparently appreciate the importance of engaging in an active and consultative process with organised business and labour in order to formulate legislation and policy governing such legislation. Prior to the enactment by Parliament of the Employment Equity Act, extensive consultation was undertaken by government with groups such as the National African Federated Chamber of Commerce, the Black Management Forum, the Congress of South African Trade Unions, the South African Chamber of Business and the tripartite grouping of business, labour and government, the National Economic Development and Labour Council. While consensus has not prevailed on all aspects of the legislation, this consultative process did achieve greater support for the implementation of the legislation than, it is argued, would otherwise have occurred. The debate with such stakeholders culminated in compromise in the area of target setting (as opposed to quotas), time frames for affirmative action strategies, and a definition of the companies and organisations that are required to comply with the provisions of the Act. In this regard, the Malaysian practice was followed by negotiating the implementation of policies and practices governing employment equity and which does provide business with a degree of flexibility within parameters that also encompass measures for government monitoring and control. As is the case in the experiences of Malaysia, India, Canada and Zimbabwe, the South African legislation does allow for the possibility of exploitation by the more advantaged of a disadvantaged group. Like Zimbabwe, a cause for concern has arisen in South Africa where jobs are subtly reserved, in some cases, by black African managers for ‘‘friends in the struggle against apartheid’’ and where business has capitalised upon the recruitment of black Africans who were trained abroad during
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the apartheid era. In addition, it is common practice in South African companies, as in Zimbabwe, to recruit blacks into senior positions in order to secure government or para-statal contracts. A further problem exists in South Africa, in that companies have focused upon recruitment and promotional strategies that are argued by some to favour black Africans at the expense of Coloureds and Indians. These practices are setting up schisms in companies where a view is expressed that under apartheid Coloureds and Indians were not white enough – now they are not black enough. Valentine (1995) notes this phenomenon to constitute ‘‘hierarchies of oppression’’ where different disadvantaged groups vie with each other for resources, as noted in India. Such practices demand that structures are set up to clearly define the beneficiaries of affirmative action and a constant evaluation to ensure that affirmative action does not simply benefit an elite group or result in the practice of tokenism. A more focused approach to ensure that the most deserving individuals benefit, would be a preferable one. From the Canadian and British experiences, it can be seen that the monitoring of progress by a credible authority is important, and that while codes of good practice are important, they are not sufficient to ensure compliance. The monitoring of issues such as policies and practices, systemic discrimination and the creation of organisational cultures that are free of unfair discrimination are essential components to complement target setting. The experience from the USA illustrates that such monitoring should also ensure that strategies to achieve employment equity remain relevant and do not become counterproductive. The South African Department of Labour has conducted studies on best practice upon which a code of best practice has been developed to assist companies in implementing employment equity strategies (Department of Labour, 1998b). Numerical target setting is essential, as shown by the experience in the USA where research, based on almost 69,000 federal contractors from 1974 to 1980 indicates that an affirmative action goal is the single best predictor of the subsequent employment of women and minorities (Jain, 1999). Jain (1999, p. iii) further states that ‘‘. . . set goals were not fulfilled with the rigidity one would expect of quotas. It also highlighted that, while employers promise more than they deliver, the ones that promise (that is, set specific goals) do deliver more than those who do not’’. The South African Department of Labour has legislated that negotiated targets between management and employees are set between one and five years. It is believed that this practice will also, to some degree, ensure that token appointments are not effected purely to achieve set quotas. From experience in the USA, Canada, Britain and Zimbabwe, it can be seen that employment equity must necessarily be embarked upon as an
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holistic process. There must be a focus beyond numbers to issues relating to training and development, mentoring and coaching, competence transfer for those recruited into companies. Simply outlawing discriminatory selection, recruitment and promotion practices is insufficient in the long term if companies, and countries wish to be competitive. From the experience in Zimbabwe, the lesson should be learnt that a pitfall exists when race only (or any other demographic issue) is the only factor taken into account in recruitment and promotions. Strachan (1993) advocates that a new and holistic operational structure must be devised that would take into account transparency of practice, quality of service, accountability to stakeholders, training and merit-based promotions. From the British and Zimbabwean experiences, it is evident that top management commitment to employment equity must be present. This, perhaps, is one of the most difficult practices to address. The British practice of securing agreement between management and employees appears not to have worked optimally. This calls into question the entire philosophy of ‘‘voluntarism’’ and begs the question ‘‘can one rely on the good faith of employers?’’. The British experience seems to illustrate that while legislation can provide a foundation to prevent the occurrence of overt discrimination, the law, by itself, without enforced compliance, is not sufficient to remove discrimination. However, compliance is one thing; actual effective utilisation of those recruited through affirmative action strategies is quite another. Katz (1982) has illustrated the tendency of established groups to prefer the status quo and to experience selective perception, while other research has highlighted the propensity of people to select and include those who evidence attributes similar to themselves, be it in terms of demographics (Michel and Hambrick, 1992; Tsui et al., 1992, Wiersema and Bantel, 1992), age (Stangor et al., 1992), and educational level (Tajfel and Turner, 1986). Ultimately, it may be the breaking of the code of the ‘‘old boy’s network’’ as noted by Clarke (1998) and Coulson-Thomas (1994) that has ensured that the dominant group in the South African case – white males – succeed in business.
Conclusion South African companies are compelled to comply with the provisions of the Employment Equity Act. Perhaps lessons from abroad can assist in the circumvention of pitfalls encountered by other countries, particularly in the areas of sound monitoring of progress towards employment equity, taking proactive measures to ensure that the majority of previously disadvantaged groups benefit from the legislation and the introduction of holistic human resources practices that complement target setting. The macro economic issues are more complex and need to command prime attention of government to ensure, amongst other things, that employment equity and the diversity that it
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creates within companies works towards the competitiveness of the country and that racial and ethnic divisiveness is not created. The challenge also exists on the operational level to identify sound business reasons for the diversity created by strategies to achieve employment equity. This demands creative vision and the will on the part of management to fully tap into the potential of all employees of the workforce. Notes 1. Throughout this paper the term ‘‘black’’ is used in the South African generic sense, i.e. when referring collectively to members of the African, Indian and Coloured (mixed-race) populations. 2. Historically in South Africa, population groups have been broadly categorised as African, Coloured, Asian and White. The Employment Equity Act (Republic of South Africa, 1998a) now requires employment equity plans and targets to be set for the designated group ‘‘black’’ according to the subgroups African, Coloured and Indian. Broadly, the subgroup ‘‘Indian’’ equates with the former category of ‘‘Asian’’. References Adams, C. (1993), Affirmative Action in a Democratic South Africa, Juta and Co., Kenwyn, Cape Town. Agocs, C. and Burr, C. (1996), ‘‘Employment equity, affirmative action and managing diversity: assessing the differences’’, International Journal of Manpower, Vol. 17 No. 4/5, pp. 30-45. Bantel, K.A. and Jackson, S.E. (1989), ‘‘Top management and innovations in management: does the composition of the top team make a difference?’’, Strategic Management Journal, Vol. 10, pp. 107-24. Bennell, P. and Strachan, B. (1992), ‘‘The Zimbabwean experience: black occupational advancement’’ in Hugo, P. (Ed.), Redistribution and Affirmative Action, Southern Books, Halfway House, Johannesburg, pp. 23-41. Be´teille, A. (1993), ‘‘India: equal opportunities for all and special opportunities for some’’, Development and Democracy, The Urban Foundation, Johannesburg, pp. 3-20. BMF (1993), Affirmative Action Blueprint, Black Management Forum, Johannesburg. Breakwater Monitor (1997), University of Cape Town, Graduate School of Business, Cape Town, September. Breakwater Monitor (1998), University of Cape Town, Graduate School of Business, Cape Town, June. Business Times (1997), ‘‘Workers feel left behind by rigid, tight managers’’, 16 February. Castle, J. (1995), ‘‘Affirmative action in three developing countries: lessons from Zimbabwe, Namibia and Malaysia’’, South African Journal of Labour Relations, Vol. 19 No. 1, pp. 6-33. Charlton, G. and van Niekerk, N. (1994), Affirming Action – Beyond 1994, Juta, Cape Town. Christie, P. (1996), Stories from an Afman(ager)!, Knowledge Resources, Randburg. Clarke, T. (1998), ‘‘The contribution of non-executive directors to the effectiveness of corporate governance’’, Career Development International, Vol. 3 No. 3, pp. 118-24. Coulson-Thomas, C. (1994), ‘‘Developing directors: building an effective boardroom’’, Journal of European Industrial Training, Vol. 18 No. 6, pp. 29-52. Cox, T.H. Jr (1993), Cultural Diversity in Organizations: Theory, Research and Practice, Berrett-Koehler, San Francisco, CA.
Cox, T.H. and Blake, S. (1991), ‘‘Managing cultural diversity: implications for organizational competitiveness’’, Academy of Management Executive, Vol. 5 No. 3, pp. 45-56. Cox, T.H., Lobel, S.A. and McLeod, P.L. (1991), ‘‘Effects of ethnic group cultural differences on cooperative and competitive behavior on a group task’’, Academy of Management Journal, Vol. 34, pp. 827-47. Days, D.S. (1993), ‘‘The United States: an historical perspective on affirmative action’’, Development and Democracy, The Urban Foundation, Johannesburg, pp. 58-65. Department of Labour (1998a), National Baseline Survey, Pretoria. Department of Labour (1998b), Practices of Employment Equity in Selected Companies in South Africa: Implications for Best Practice, Pretoria, June. Department of Labour (1999), ‘‘Employment equity’’, available at: www.polity.org.za/govdocs/ commissions/fin8.html Dickman, J. (1998), ‘‘Employment equity bill: SACOB’S viewpoint’’, Accountancy SA, July. Douwes Dekker, L. (1993), ‘‘Resolving structural tension: a basis for codetermination in South Africa’’, in Christie, P., Lessem R. and Mbigi, L. (Eds), African Management: Philosophies, Concepts and Applications, Knowledge Resources, Randburg, pp. 143-82. Emsley, I. (1996), The Malaysian Experience of Affirmative Action: Lessons for South Africa, Juta, Cape Town. Fernandez, R.R. (1997), ‘‘Affirmative action: a pivotal discussion’’, U.S. Society and Values, August, pp. 23-30. Gatherer, J. and Erickson, J. (1993), ‘‘Affirmative action in Zimbabwe: a private sector case study’’ in Innes, D., Kentridge, M. and Perold, H. (Eds), Reversing Discrimination: Affirmative Action in the Workplace, Oxford University Press, Cape Town, pp. 149-68. Gebhart, C. (1994), ‘‘High pay, low output dilemma’’, The Star International Weekly, 4-10 August, p. 14. Glick, W.H., Miller, C.C. and Huber, G.P. (1993), ‘‘The impact of upper echelon diversity on organizational performance’’, in Huber, G.P. and Glick, W.H. (Eds), Organizational Change and Redesign: Ideas and Insights for Improving Performance, Oxford University Press, New York, NY, pp. 176-224. Greenhaus, J.H., Parasuraman, S. and Wormley, W.M. (1990), ‘‘Effects of race on organizational experiences, job performance evaluations, and career outcomes’’, Academy of Management Journal, Vol. 33, pp. 64-86. Horwitz, F.M., Bowmaker-Falconer, A. and Searll, P. (1996), ‘‘Human resource development and managing diversity in South Africa’’, International Journal of Manpower, Vol. 17 No. 4/5, pp. 134-51. (IMD) Institute for Management Development (1999), World Competitiveness, available at: www.imd.ch/wcy/factors/overall.html Jafta, R. (1998), ‘‘The high cost of affirmative action’’, Focus, April. Jain, H.C. (1999): ‘‘Foreword’’, in Thomas, A. and Robertshaw, D. (Eds), Achieving Employment Equity: A Guide to Effective Strategies, Knowledge Resources, Randburg, pp. i-iv. Jain, H.C. (2000), ‘‘Global equity in the twenty-first century in selected countries’’, paper presented at the 12th World Congress of the International Industrial Relations Association, Tokyo, 29 May-2 June. Jain, H.C. and Ratnam, C.S.V. (1994), ‘‘Affirmative action in employment for the scheduled castes and scheduled tribes in India’’, International Journal of Manpower, Vol. 15 No. 7, pp. 6-25. Johnson, R. (1997), ‘‘US race and gender quotas crumble in air of acrimony’’, Financial Mail, 14 November.
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Canada’s employment equity legislation and policy, 1987-2000 The gap between policy and practice Carol Agocs Department of Political Science, The University of Western Ontario, London, Ontario, Canada Keywords Employment law, Organizational behaviour, Discrimination, Employment, Canada Abstract Over the past 16 years, a legislative and policy framework has evolved in Canada to address systemic discrimination in employment in the federal jurisdiction, and in organizations that sell goods or services to the federal government. Data collected pursuant to the Employment Equity Act, as well as published literature and government documents, are reviewed in order to provide a critical analysis of the federal policy framework as set out in 1987 and revised in 1996. This review is the basis for assessing both progress and lack of improvement in the employment status of racial minority, aboriginal, and disabled women and men, as well as white women, within the federal sector. Reasons for limited results are proposed, and issues posed by contemporary labour market trends are identified. It is argued that the results of employment equity policy are disappointing because the policy is not being implemented by employers and effectively enforced so that there are consequences for employers’ failures to comply. In other words, there is a persisting gap between employment equity policy and practice. This gap presents difficulties in evaluating the content of employment equity policy, since it is not possible to evaluate a policy that is not implemented.
International Journal of Manpower, Vol. 23 No. 3, 2002, pp. 256-276. # MCB UP Limited, 0143-7720 DOI 10.1108/01437720210432220
Introduction During the mid-1980s, the concept of systemic discrimination moved to the forefront of debates about the causes and remedies for inequality in employment in Canada. The federal Employment Equity Act (1986) and Federal Contractors Program (1986), as well as important sections of the Canadian Human Rights Act (1978) and the Charter of Rights and Freedoms of the Constitution Act (1982), were Canada’s legislative and policy responses to systemic discrimination in the workplace. In 1987 the province of Quebec passed its own employment equity legislation for its public sector (Gagnon and Letourneau, 1996), and in 1994, Ontario followed with what some would consider the world’s most comprehensive employment equity legislation. Pay equity complements employment equity by addressing wage discrimination that affects workers in female-dominated occupations. In 1988 the province of Ontario enacted pro-active pay equity legislation requiring private and public sector employers to evaluate jobs using criteria of skill, effort, responsibility and working conditions, and to pay people in femaledominated jobs the same as people in equivalent male-dominated jobs. The federal government had already adopted legislation requiring female and male
employees to be paid alike for work of equal value to the employer. However, 1995 saw the beginning of a retreat from Canada’s relatively vigorous policy response to systemic discrimination in the late 1980s. The most visible signal of this retreat was the acrimonious campaign in Ontario in 1995 resulting in the election of Mike Harris’ progressive conservative government, on a platform that exemplified the neo-conservative ideology ascendant in Margaret Thatcher’s Britain. As he had promised, one of Harris’ first acts as Premier was to repeal Ontario’s Employment Equity Act, which had been in effect for only a few months. Subsequent court challenges to Harris’ Job Quotas Repeal Act were mounted by the Alliance for Employment Equity, with the assistance of the women’s movement’s Legal Education and Action Fund and other equality seekers. The Ontario courts’ decisions in this series of charter challenge cases essentially affirmed the prerogative of the government in power to pass legislation, but did not rule on the content of the legislation at issue. Shortly after repealing the Employment Equity Act, the Harris government moved to water down the requirements of the Ontario Pay Equity Act and to significantly reduce the services and resources of the Ontario Human Rights Commission. The Liberal government in Ottawa, meanwhile, was committed to implementing a neo-conservative program of stimulating the growth of the private sector while cutting government employment and services. At the turn of a new century, as Canadian society and labour markets become increasingly diverse on the basis of race, ethnicity and gender, the political will necessary to prevent that diversity from becoming stratified into entrenched patterns of inequality waned. In sum, the promising potential of Canada’s early employment equity policy initiatives has not yet been realized. There continues to be a gap between employment equity policy on the one hand, and action and implementation on the other. This discussion outlines Canadian experience with employment equity policy and its implementation, highlighting its fundamental purpose as a remedy for systemic discrimination in the workplace. I will consider the potential capability of federal employment equity legislation and policy to provide an effective response to systemic discrimination, as well as available evidence regarding the actual results of employment equity as it has been implemented since 1987. Reasons for the limited effectiveness of employment equity in addressing systemic discrimination are then considered. In conclusion, I will identify some of the future challenges posed by the changing nature of work. Systemic discrimination in employment Systemic discrimination may be defined as those patterns of organizational behaviour that are part of the social and administrative structure and culture and decision-making processes of the workplace, and that create or perpetuate relative disadvantage for members of some groups and privilege for members of other groups. In other words, the concept of systemic discrimination
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encompasses the complex and interrelated pattern of policies, institutionalized practices, norms and values that perpetuate exclusionary structures and relationships of power and opportunity within organizations and labour markets. At the level of the workplace, systemic discrimination may be embedded in a broad spectrum of employment-related decisions affecting access to employment, job assignment, terms and conditions of employment, training and development, compensation, promotion, performance appraisal, quality of work life, work-family relationships, and termination. Moreover, informal social relations, networks of communication, and the quality of workplace culture and climate may perpetuate patterns of systemic discrimination. No matter what form it takes, systemic discrimination may exist in the absence of conscious intent to discriminate since it is enacted in decisions and behaviours that create inequality and unfairness for some groups within a workplace. In Canadian society, research evidence, case law, and advocacy have established that four groups have been persistently and significantly disadvantaged in employment with respect to access to regular full time employment opportunities, fair compensation, and representation at upper levels of management, among other indicators. These groups are: (1) women of any race or ethnicity; (2) visible or racial minorities (70 per cent of whom are people who identify themselves as belonging to Black, Asian, or South Asian populations in Canada); (3) aboriginal peoples (who include Indians or members of First Nations, Metis and Inuit); and (4) persons with disabilities (Human Resources Development Canada, June 1999)[1]. These four groups are referred to as ‘‘designated groups’’ under Canadian employment equity legislation and policy[2]. It is of central concern in this enquiry to assess the degree to which Canadian employment equity legislation, as it is designed and implemented, constitutes an effective response to systemic employment discrimination affecting women, racial minorities, aboriginal peoples and persons with disabilities. From the working definition of systemic discrimination proposed above, the following criteria for assessment can be derived: .
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numerical representation throughout the organization that reflects the representation of the designated groups in relevant labour markets; removal of discriminatory barriers in organizational decision-making processes that limit the access, career development, full participation, and accommodation of the uniqueness of each of the four disadvantaged groups;
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creation of a workplace culture in which the four groups experience inclusion and belonging, supportive supervision, the possibility of full participation, and freedom from harassment; and equality of results as measured by indicators such as compensation (salary and benefits) and decision-making power (representation in management) for designated group members equivalent to those enjoyed by majority group members with similar qualifications and/or performance.
It is important to make a clear distinction between employment equity policy and anti-discrimination provisions of federal and provincial human rights codes. Human rights codes provide for individuals who believe they have been victims of discrimination to bring a complaint to the human rights commission in their jurisdiction. Such complaints are usually dealt with by means of mediation and conciliation; only a small percentage of complaints is heard by tribunals. The human rights process requires victims of discrimination or harassment to carry the risk and burden of seeking redress. Both the Canadian Human Rights Act (1978) and the Charter of Rights and Freedoms of the Constitution of Canada (1982) contain sections that permit employers to implement voluntary employment equity programs. However, only a handful of firms did so prior to the introduction of mandatory employment equity by legislation and regulation. Furthermore, although federal and many provincial human rights codes contain provisions that allow human rights commissions to initiate complaints of systemic discrimination, this has rarely been done: resources have generally not been allocated to this purpose. Furthermore, in the 1990s, the work of human rights commissions was undermined by budget cuts which have severely curtailed their services and resulted in backlogs, such that a case may take several years to come to tribunal. In contrast to the human rights complaint procedure, employment equity policy is not driven by individual complaints. Employers are required to undertake actions to proactively identify and remove or replace policies and practices that may have discriminatory impacts, and to improve the representation of under-represented groups in their workplaces. The focus of employment equity is upon organizational changes implemented by employers for the purpose of correcting, minimizing and preventing systemic discrimination. The result of such changes is expected to be an improvement in the numerical representation of members of the four disadvantaged groups, such that over time an organization’s workforce will come to reflect the labour markets from which it recruits, and ultimately, the diversity of Canadian society. Canada’s first Employment Equity Act was passed in 1986 by the Progressive Conservative government of Brian Mulroney, and took effect in 1987. Its rationale and many of its fundamental concepts, including the name ‘‘employment equity’’ and the principle of creating a policy response to the
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problem of systemic discrimination, were drawn from Justice Rosalie Abella’s Report of the Royal Commission on Equality of Employment Opportunity (Abella, 1984). (The Royal Commission had been established by the preceding Liberal government of John Turner.) However, the 1986 Act failed to address significant recommendations of Abella’s Report, including the implementation of an effective monitoring and enforcement capability, sanctions for failure to implement employment equity, and a supportive constellation of programs such as public day care and training. In 1986 the Government of Canada also initiated the Federal Contractors Program, a regulatory program which applies to employers that have 100 or more employees, and who wish to sell goods or services to the federal government valued at $200,000 or more. Such employers are required to implement employment equity as a condition of bidding on contracts with the government. In 1995, under the Liberal government of Jean Chretien, the Act was reviewed, following a process of evaluation and public consultation, and a new Employment Equity Act was passed which took effect 24 October, 1996. The most significant changes in the Act’s requirements were the following: . coverage of employers was expanded to include the federal public service, commissions and agencies, as well as the Royal Canadian Mounted Police, the Canadian Forces, and the Canadian Security Intelligence Service; . beginning in 1997, employers covered by the Act are subject to compliance audits by the Canadian Human Rights Commission, and an employment equity review tribunal was created and given authority to enforce compliance; . the requirements of the Federal Contractors Program were made equivalent to those affecting employers covered by the Act, and . employers now are obliged to ‘‘consult and collaborate with employee representatives’’ (Human Resources Development Canada, 1999, p. 3). Under the 1996 Act, as under the 1987 Act, employers are required to report anually to the Minister (Human Resources Development Canada after 1996) and their individual reports are made public; information from their reports is also included in a summary annual report published by Human Resources Development Canada. However, while federal contractors are subject to compliance reviews by the Department of Human Resources Development, contractors are not required to submit their equity plans and reports to the department, and there is no public reporting on their results. Many of the revisions of the 1987 Act were responses to the findings of the research evaluation and to critiques presented by organizations representing the designated groups, trade unions and other advocates of a more vigorous legislative response to systemic discrimination. Predictably, their views were countered by lobbyists for business and other interest groups advocating a
limited policy response. While it contains more provisions for holding employers accountable than the 1987 Act, the new Act also contains weaknesses reflective of political compromises. Equally important, a major priority of the Liberal government in the 1990s was to reduce spending by means of extensive cuts to federal employment and services, resulting in a downsizing of the federal workforce by 14 per cent (McMullen, 1998, p. 5). It is not surprising, then, that the resources allocated to the implementation and enforcement of the Act were significantly depleted during the 1990s, at the same time that its requirements were somewhat strengthened. Overview of employment equity policy and results: an effective response to systemic discrimination? Given this history, what can be expected? What is the potential of federal employment equity policy to reduce systemic discrimination against the four designated groups? A comparison of policy provisions with the four criteria for assessment mentioned above can provide one set of answers to this question and point to some gaps and limitations in the policy framework. Available information will now be examined regarding results attained under employment equity policy so far, with reference to each of the four criteria. For this purpose we will draw upon published research, the annual reports published under the Employment Equity Act, and the annual report of the Canadian Human Rights Commission. However, because of significant gaps in the information available, the review of results to date must be taken as preliminary and suggestive. In particular, there is virtually no information available that relates to the creation of an inclusive workplace culture. Furthermore, since little information is publicly available concerning results achieved under the Federal Contractors Program, the overview and assessment that follows will focus primarily on the policy provisions and the results attained under the Employment Equity Act, and will have little to say about the FCP. Reviews and evaluations of results under the FCP and the legislated employment equity program are now in progress, as required by the 1996 Act. 1. Numerical representation throughout the organization reflective of representation in relevant labour markets As summarized in Table I, the Act and FCP both contain a number of requirements related to numerical representation, which is the primary measure of the success of employment equity policy. Requirements employers must meet under the law include the implementation of a workforce census based upon voluntary self-reports by employees as to their membership in the designated groups. Employers are required to report on the representation of the designated groups across 14 occupational categories, by salary quartiles within each category, as well as submit counts of designated group representation among employees hired, promoted and terminated. Employers are required to identify areas of under-representation and to set their own goals and timetables for improvement, and to specify the measures they will take to
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Table I. Members of designated groups by sex and industrial sector, 1987, 1996 and 1998; firms reporting under the Employment Equity Act, Canada 44
6.3
5.4
2.1
46.4
53.6
10.3
4.8
5.4
6.5
3
3.5
2.1
1
1.1
1,780 1 4,518 2.6 6,298 3.7 6,993 4.1 17,256 10 24,249 14.1 43,491
955 0.6 2,084 1.2 3,309 1.8 3,998 2.4 12,076 7.1 16,074 9.5 40,504
47,862
8,383 4.8 18,218 10.5 26,601 15.3
1,326 0.8 2,652 1.5 3,978 2.3
449 0.3 1,793 1 2,242 1.3
1998
129,003 128,838 126,271 76.1 74.8 72.5 169,507 174,133
355 0.2 1,552 0.9 1,907 1.1
Banking 1996
117 0 828 0.5 945 0.6
1987
69,592 39.7
105,630
8,051 4.6 4,537 2.6 12,573 7.2
1,725 1 739 0.4 2,465 1.4
113,642
10,204 5.2 7,306 3.8 17,510 9
3,089 1.6 1,619 0.8 4,708 2.4
1,128 0.6 1,080 0.6 2,208 1.1
167,009
4,016 2 1,229 0.6 5,245 2.6
2,529 1.3 332 0.2 2,861 1.4
115,109
4,983 3.4 2,041 1.4 7,024 4.8
1,999 1.4 330 0.2 2,329 1.6
1,428 1 361 0.2 1,789 1.2
119,615
5,962 3.8 2,911 1.9 8,873 5.7
2,382 1.5 485 0.3 2,867 1.8
1,566 1 483 0.3 2,049 1.3
Transportation 1996 1998
1,250 0.6 211 0.1 1,461 0.7
1987
79,261 81,138 34,009 32,108 36,857 42.2 41.7 16.9 21.8 23.6 188,020 194,780 201,110 147,217 156,472 (continued)
108,759
9,461 5 7,091 3.8 16,552 8.8
3,129 1.7 1,651 0.9 4,780 2.5
1,044 0.6 1,009 0.5 2,053 1.1
Communications 1996 1998
550 0.3 525 0.3 1,075 0.6
1987
262
Aboriginal peoples Men % Women % Total % Persons with disabilities Men % Women % Total % Members of visible minorities Men % Women % Total % All employees Men % Women % Total
Canadian workforce 1986 1996
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Other sectors 1996 1998 1987
All sectors 1996 1998
Number of firms reporting: 1987 1996 1998
Aboriginal peoples Men 315 905 928 2,232 3,732 4,071 Banking 23 18 18 % 0.8 1.5 1.5 0.4 0.7 0.7 Communications 90 87 99 Women 66 300 311 1,630 3,222 3,667 Transportation 208 171 167 % 0.2 0.5 0.5 0.3 0.6 0.6 Other 52 54 49 Total 381 1,205 1,239 3,862 6,954 7,738 Total 373 330 333 % 0.9 2 2 0.7 1.2 1.3 Persons with disabilities Men 870 1,470 1,465 6,079 8,378 8,262 % 2.1 2.4 2.4 1 1.5 1.4 Women 105 303 281 3,260 6,802 5,037 % 0.2 0.5 0.5 5.6 1.2 0.9 Total 987 1,773 1,746 9,352 15,180 13,299 % 2.4 2.9 2.3 1.6 2.7 2.3 Members of visible minorities Men 740 3,525 3,504 16,805 24,962 28,053 % 1.8 5.7 5.8 2.9 4.4 4.8 Women 337 1,171 1,306 18,179 27,559 29,741 % 0.8 1.9 2.1 3.1 4.8 5.1 Total 1,078 4,696 4,810 34,970 52,521 57,794 % 2.6 7.6 7.9 6 9.2 9.9 All employees Men 32,177 46,621 45,616 345,320 313,980 326,735 % Women 8,843 14,894 15,198 241,537 255,101 259,464 % 21.6 24.2 25 41.2 44.8 44.3 Total 41,020 61,515 60,814 586,861 569,081 586,199 Notes: Numbers denote employees in all jobs, including full time, part time and temporary; % = per cent of all employees in that sector that year; Sources: Canadian workforce: 1996 Census of Canada, population age 15-64 who worked sometime in 1995 or 1996 (1986-1991 for people with disabilities, as reported in 1991 Health and Activity Limitation Survey); Human Resources Development Canada, Annual Report, Employment Equity 1988, 1997, 1999, and June 1999
1987
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Table I.
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bring about those improvements. The goals are to be set with reference to data on the availability of designated group members in relevant labour markets. Availability data usually consist of census data provided to employers by Human Resources Development Canada. The compliance audit by the Canadian Human Rights Commission reviews the employer’s goals for improving the numerical representation of designated groups. During its first two years of experience under the 1996 act, the commission found that many employers set goals that were lower than availability, with the result that their representation levels did not improve (Canadian Human Rights Commission, 1999). Table I presents data on changes in the representation of the designated groups from 1987 to 1998 in the sectors covered by the Employment Equity Act. In addition to these data, the 1999 Annual Report of the Canadian Human Rights Commission included summaries of results in the federal public service as well as in the federally regulated private sector. Overall, changes in the numerical representation of the designated groups were as follows: . Women’s representation increased from 40.1 percent in 1987 to 44.3 percent in 1998 in the private sector, close to their availability of 46.4 per cent. In the federal public service, women’s representation increased from 42 per cent in 1987 to 51.5 per cent by 1999. However, there was significant variability in women’s representation levels across sectors and occupational groups, and their representation remained low in some sectors and types of jobs. Long-standing patterns of concentration of women in a narrow range of occupational groups continued. . The representation of visible minorities increased in the private sector from 4.9 per cent in 1987 to 9.9 per cent in 1998, compared with an availability rate of 10.3 per cent. Their representation rates also vary considerably across sectors and occupations, and their presence in senior management continues to be low. The representation of visible minorities in the federal public sector was only 5.9 per cent in 1999, and their share of hirings was only 4.4 per cent. A 1997 research study examined possible reasons for the poor representation of visible minorities in the federal public service. The research identified a lack of flexibility in the staffing process, lack of senior managers who are members of visible minorities, and importance of ‘‘old boys’’’ social networks and ties as barriers to equity in hiring and promotion (Samuels, 1996). . The representation of aboriginal people in the private sector in 1998 was only 1.3 per cent, compared to an availability rate of 2.1 per cent. Moreover, the hiring of aboriginal people has declined for four years in a row, and they suffered a disproportionately high share of terminations. In the public sector, aboriginal representation reached 2.9 per cent in 1999; however there was a concentration of this group in the Department
.
.
of Indian and Northern Affairs, and a very low representation in most of the other departments. People with disabilities comprised 2.3 per cent of public sector employees in 1998, and their share of hirings fell for the fifth year in a row. They were significantly under-represented in all sectors even in comparison with a 1991 availability rate of 6.5 per cent. In the public sector, their representation stood at 4.6 per cent in 1998. Overall, the numerical representation of women and visible minorities has increased considerably, while that of aboriginal people increased slightly and persons with disabilities has increased slightly and then decreased under employment equity policy. So far, the new Employment Equity Act has not delivered significant improvements over the 1987 Act.
These general observations regarding changes in representation rates also mask many important facts, such as the distribution of part time and temporary jobs as compared with traditional full time jobs. The summary annual reports of employers’ results under the Act report detailed data only for all jobs combined, not for regular full time, part time, and temporary jobs separately. As discussed in the final section of this paper, women have suffered large negative impacts as a result of the restructuring of the labour market and are over-represented in part time and temporary work in the labour market as a whole, and in the organizations covered by the Act. 2. Removal of discriminatory barriers in decision-making processes Both the Act and the FCP require the employer to review the policies and practices that govern hiring and promotion in order to identify and remove or replace those that create discriminatory barriers that are not necessary to the operation of the business. The 1997 Act also requires that unions be involved in employment equity implementation, and requires employers in ununionized workplaces to consult with employee representatives, including members of the designated groups. All of these requirements appear to contribute to an effective program to reduce discrimination embedded in human resource management policies and practices. A caveat is that seniority is deemed not to be an unacceptable barrier, which is likely to limit the retention of members of under-represented groups during slowdowns in the economy (Singh and Reid, 1998). In the context of its compliance audit process, the Canadian Human Rights Commission considers the employment systems review to be a cornerstone of an employer’s employment equity program, since goal setting and special measures follow from the results of the review. The commission has found in its first two years of experience under the 1995 Act that many employers have failed to undertake employment systems reviews, and for this reason, compliance with the Act is at a low level.
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There is evidence that when employers do make efforts to remove barriers and adopt proactive equity practices, there are positive outcomes for the designated groups. Leck and Saunders (1992) found that firms covered by the 1987 Act that had adopted employment equity programs that were more formalized (i.e. included goals, timetables and plans, an employment equity administrator, and regular audits), more comprehensive, and better supported by management showed the most progress toward hiring a representative proportion of women in management positions. In these firms, the most representative hiring occurred for white non-disabled women, followed by women who were members of visible minorities, aboriginal women, and disabled women. In another analysis, Leck and Saunders (1996) found that the presence of formalized equity programs was related to increases in the representation of visible minorities in both management and non-management jobs. However, Leck and Saunders (1992, p. 209; 1996, p. 315) found that a majority of organizations under the Act did not hire women or visible minorities in proportion to their availability in the labour market. Hence simply being covered by the Act did not mean that a firm would hire representatively. In a study of 17 Ontario universities, 12 of which were participants in the Federal Contractors Program, Stewart and Drakich (1995) found that the four FCP universities with the most vigorous employment equity programs also had the highest level of recruitment of women into entry level faculty positions. The universities showing the largest increases in the representation of women had implemented various equity measures, including affirmative searches and advertising, and peer monitoring of hiring processes at both central and departmental levels. However, simply being a member of the FCP was not associated with institutional gains in the hiring of women (Stewart and Drakich, 1995, p. 444). Clearly what counts is the implementation of actions designed to remove discriminatory barriers and get results, rather than mere participation in the FCP. 3. Creation of a workplace culture that is inclusive and free from harassment Employment equity policy contains no provisions that directly address issues of workplace culture or climate, aside from the requirement to explain the purpose of employment equity to employees. Recent research in Canada and the USA suggests that the persistence of inequality on the basis of gender and race may be strongly linked to patterns of exclusion, marginalization and harassment that are embedded in the informal social relations of an organization. This may be increasingly true as the structure of the labour market and work evolve toward an ‘‘information society’’ in which jobs are defined more flexibly and criteria for hiring and promotion may become more vague, placing greater emphasis on ‘‘fit’’ and ‘‘teamwork’’. At present, about 70 per cent of Canadian employment is concentrated in the service sector, and a growing proportion of jobs involve office work in technical, managerial and professional functions. A recent review of published tribunal and court decisions in racial harassment cases revealed that 47 per cent of complaints
arose in organizations in the public sector, and 76 per cent came from white collar employees – the majority in professional, managerial and technical jobs (Jain et al., 1999). The lack of specific provisions in employment equity policy to address systemic discrimination in the culture of the workplace is a significant weakness, particularly as employment becomes increasingly concentrated in functions involving the communication and management of information. Workplace culture is not systematically monitored as part of the compliance review process, and there is as yet no published research examining this significant issue for employment equity policy. 4. Equality of results Research using wage levels as a dependent variable has made a large and important contribution to our knowledge about the effects of affirmative action and employment equity interventions. We would expect that reductions in the impact of systemic discrimination would result in a decline in the wage disadvantage suffered by women, visible minorities, aboriginal people and persons with disabilities. For example, an analysis of Labor Market Activity Survey data found that designated group members had a salary advantage of 7.2 per cent in companies covered by the 1987 Act and FCP, compared with uncovered companies (Taggar et al., 1997, p. 331). Leck et al. (1995) compared average pay of the designated groups with measures of the types of employment equity activities reported by the firms covered by the 1987 Employment Equity Act between 1989 and 1993 to examine the effects of employment equity on the wage gap. The analysis shows some reduction in the wage gap between white men and each of the designated groups in the lower and middle salary ranges, but an increase in the wage gap at higher salary levels. In firms that had the most formalized employment equity programs, the improvement in average pay of white, visible minority and disabled women, as well as aboriginal men and white men, was greatest. Formalized programs were those characterized by goals, timetables, plans, audits and an employment equity administrator. Employment equity programs, then, were reducing the wage gap between white men and the four designated groups, with white women as the largest beneficiaries. Increases in the representation of the designated groups in senior management can be considered another indicator of progress toward employment equity. Senior managers are defined as ‘‘employees holding the most senior positions in large firms or corporations,’’ and who are responsible for corporate policy, strategic planning and the direction and control of the organization’s functions (Human Resources Development Canada, 1999, p. 62). Table II summarizes data on firms covered by the Act. Census data for 1996 show that of senior managers in the Canadian workforce, 78.8 per cent were men and 21.2 per cent were women; as well, 0.2 per cent were aboriginal and 12.5 per cent were members of visible minorities. Available data on firms under the Act show that since the beginning of mandatory employment equity policy in Canada, there has been no improvement in the representation of aboriginal
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Table II. Members of designated groups who are upper level or senior managers, by sex; firms reporting under the Employment Equity Act, Canada 1987, 1996 and 1998
Upper level managers 1987 1996 Aboriginal peoples Men % Women % Total % Persons with disabilities Men % Women % Total % Members of visible minorities Men % Women % Total % All employees Men % Women % Total % Employees who are not Aboriginal, persons with disabilities, or visible minorities Men % Women % Total %
Senior managers 1998
11 0.2 1 0 12 0.3
15 0.3 2 0 17 0.3
na
67 1.5 3 0.1 70 1.6
110 2.2 15 0.3 125 2.5
na
107 2.4 10 0.2 117 2.6
128 2.6 23 0.5 151 3
na
4,268 95.3 210 4.7 4,478
4,244 85.1 741 14.9 4,985
3,673 84.1 695 15.9 4,368
4,083 91.2 196 4.4 4,279 95.6
3,991 80.1 701 14.1 4,692 94.1
na
na 18 0.4
na 69 1.6
na 129 3
na 4,152 95.1
Notes: Employees in all jobs, including full time, part time and temporary; numbers denote % = per cent of all upper management employees during that year Source: Human Resources Development Canada, Annual Reports, Employment Equity Act, 1988, 1997 and 1999
people in senior management. By 1996 there were only two aboriginal women and 15 men at this rank. There was an increase and then a decrease in the representation of persons with disabilities, mostly men. Visible minorities – again mostly men – gained representation in senior management, but are still present far below their availability.
The representation of white women improved from 4.7 per cent to 14.1 per cent of senior managers, which was considerably below availability. In their study of the wage gap, Leck et al. (1995) found that although white women were increasing their representation in upper level management, their earnings did not keep pace with those of men at that level. The wage gap between minority women and minority men also widened in the higher salary categories. The presence of a formalized employment equity program generally did not result in a narrowing of the wage gap at high salary levels. Why the limited results? Some speculations Two different arguments have been made in an attempt to account for the limited results attained under employment equity policy. Some critics point to limitations of the Act itself, suggesting that the Act is fundamentally flawed with respect to its approach to addressing systemic discrimination; hence it is not surprising that results have been disappointing. Others have argued that the act’s approach to addressing systemic discrimination is essentially sound in theory, but it was weakened by political compromises. A notable weakness of this kind is the absence of significant sanctions for employers who fail to implement the Act’s requirements. As well, there are no sanctions for failure to get results when the employer has an equity plan in place. A related argument is that the compliance review process, even under the 1996 Act, is inadequately resourced and insufficiently stringent. The result is that employers do not give priority to the implementation of employment equity, and tend to do the minimum to comply with the act’s requirements. The discussion that follows will consider two contrasting arguments. The first is that employment equity policy as set out in the Act rests on flawed premises, and as a result, it could not be expected to prevent systemic discrimination from occurring, or lead to equity for the designated groups. The second argument is that employment equity policy as represented in the Act is sound in theory and could be an effective response to systemic discrimination if it were given force through vigorous enforcement and sanctions. However until the Act has been properly implemented, its efficacy in addressing systemic discrimination remains to be demonstrated. Lum (1995) contends that the Act is ineffective as a policy instrument for dealing with systemic discrimination because of inherent flaws, some of which remain even under the new Act. The essential weakness of the Act, in Lum’s view, is its reliance on data collection as its central policy lever. The data-related requirements are particularly undermined by the limitations of the availability data that employers rely upon to set numerical goals, as well as by inaccuracies in employers’ workforce census due to the self-identification requirement. The quality of availability data was much improved following the 1996 Census of Canada, which included more valid indicators of aboriginal and visible minority status. However, resources were not allocated to a 1996 census on disability, with the result that availability data related to disability dates back to 1991 (Human Resources Development Canada, 1999).
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Furthermore, the changed and improved definitions of aboriginal and visible minority status used in the 1996 census make comparisons with earlier years invalid. Lum (1995) also challenges weaknesses inherent in the self-identification process. For example, annual reports on results under the Act published by Human Resources Development Canada acknowledge that in some years, a large portion of the (small) increase in the representation of aboriginal people was attributable to increases in the rate of self-identification, not to employers’ implementation of the act’s requirements. There have also been persistent problems in the definition and self-identification of ‘‘persons with disabilities’’. One implication of these data problems is that the size of the labour market of available members of the designated groups is understated, with the result that employers implementing employment equity requirements are setting goals that are too low. Furthermore, in setting up the current labour market as the standard that firms are to match, the Act reinforces the very patterns of systemic discrimination that compliance with the Act is supposed to correct. A Public Service Commission forecasting model showed that ‘‘if goals are set at availability levels it would take many [federal] departments about 28 years before full representation of some designated groups is reached’’ – assuming that the goals were implemented (Canadian Human Rights Commission, 1999, p. 6). The critique of the limitations inherent in the Employment Equity Act suggests that the Act’s requirements set the bar too low for employers. The conceptual framework that underlies the Act leads to provisions that are insufficiently rigorous to result in acceptable progress toward the reduction of inequality in employment for the four designated groups. An alternative point of view is that the conceptual foundations of the Act and the policy framework that rests on it are essentially sound. The lack of results to date stems from a failure of employers to implement the Act, and of government to enforce it and hold employers accountable for lack of compliance. The issue is that the requirements of the Act – limited as they may be – are not being put into practice. The gap between policy and practice, in turn, may be traced to the lack of political will to provide adequate legislative and administrative provisions for enforcement and compliance. The compliance audit process used by the Canadian Human Rights Commission involves a desk audit and a site visit for verification. A decision that the employer is in compliance with the Act’s requirements means that the designated groups are equitably represented in the workplace, or that the commission is satisfied that the employer’s equity plan will result in ‘‘reasonable progress’’. If the employer is not in compliance, the commission prepares an interim report setting out the requirements to be completed within 12 months, and this is negotiated with the employer. Then the employer files a progress report and receives a follow-up audit. If the employer is still not in compliance the commission issues a direction as to the work required and the time limit. After another follow-up audit, if the employer is still not in compliance, the Commission may ask the Employment Equity Tribunal to
issue an order, which may be registered with a federal court. Audits take nine to eleven months each, on average (Canadian Human Rights Commission, 2000). In view of this lengthy process, with no sanctions for employers who delay, an employer may be able to avoid compliance with the Act for years. Three early studies undertaken soon after federal employment equity policy took effect in 1987 found that employers had made little progress toward implementation (Agocs, 1989; Drakich and Stewart, 1995, p. 444; Jain and Hackett, 1989). In a 1987 survey of 99 federal contractors, Agocs (1989) found that despite the FCP’s requirements, only 17 of the firms claimed to have employment equity programs, and only one had set goals for increasing the representation of women in management. Ten years later, the 1999 annual report of the Canadian Human Rights Commission notes that during the first two years of compliance audits under the 1996 Act, 111 initial audits were completed, and only four employers were found to be in compliance (Canadian Human Rights Commission, 1999). Undertakings requiring follow-up audits were signed with 103 employers, and of these, eight more were found to be in compliance the following year. However two thirds of the follow-up audits found that employers were still not in compliance and most were granted extensions. Four employers had not accomplished enough to warrant an extension, so the Commission issued directions. It is too early to tell what the next steps will be in these cases. In general, the Commission notes that: Experience to date has shown that more than 95 per cent of employers require follow-up audits, most frequently because they are insufficiently aware of the requirements of the Employment Equity Act.
A significant reason for employers’ lack of action to implement employment equity may be the lack of meaningful sanctions for non-compliance in the legislation. The Act specifically forbids the commission to impose a quota on an employer or to order an employer to undertake actions that would cause undue hardship to the employer, or to hire or promote ‘‘unqualified persons’’, or to create new positions. A tribunal can order an employer to cease discrimination and/or to comply with the Act’s requirements, but is not permitted to order an employer to adopt a special program to achieve improved representation. The Act provides for a fine of $10,000 for a single violation or $50,000 for ‘‘repeated or continued violations’’ in the case of failure to file the required reports, or for false reporting. However there is no sanction for failure to improve the representation of the designated groups, provided that the required reports are submitted and that the employer can provide a plausible reason for slow or nonexistent progress. As well, there are no sanctions for failing to remove job barriers identified in the employment systems review, or for hiring members of a designated group into a ‘‘job ghetto’’, or for paying them less than what white male workers with equivalent qualifications are paid. While failure to implement the requirements of the FCP can result in loss of the opportunity to bid on future federal contracts, this sanction has been rarely
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applied. Most Canadian universities are federal contractors: university equity officers and others who are most familiar with the employment equity compliance-related activities in universities are sometimes surprised when their organizations are found to be in compliance with the FCP requirements (Chilly Collective, 1995). Stewart and Drakich (1995, p. 444) found that universities with representations of women on faculty that were below the provincial average had been found in compliance. If indeed the FCP compliance review process is unduly lenient, it is not clear whether this is a result of inadequate resources devoted to enforcement, or of low performance expectations of employers, or both. The enforcement of the Act is hampered by resource limitations. The 1999 Annual Report of the Canadian Human Rights Commission notes that the nation-wide compliance audit program required under the Act depends on ten auditors, each of whom can realistically be expected to do ten audits each year. The Auditor General’s report noted that the CHRC had a budget of $800,000 for conducting employment equity audits in 1998-1999, and that the Commission has experienced a high level of turnover, with the result that many staff are inexperienced (Auditor General, 1998). Moreover, as noted above, employers are rarely in compliance on the first or even the second audit, leading to a cumulative workload that appears to quickly exceed the resources of the Commission. Its plan to audit every employer covered by the Act during the first five years may not be realistic. In part to address this problem and maximize the impact of the audit program, the Commission plans to concentrate on larger employers. As for the Federal Contractors Program, in 1999, only 5.5 full time positions were dedicated to HRDC’s compliance review program, to track 860 contractor firms across the nation. In addition, HRDC has responsibility for providing availability data, information about the Act’s requirements, and consultation to employers covered by the Employment Equity Act – services which have not met the need, judging from the Canadian Human Rights Commission’s experience with compliance audits. A suggestion regarding the possible extent of employers’ non-compliance and manipulation of legislated requirements can be found in a small study of private sector firms’ implementation of pay equity in Ontario during the years when pay equity had the support of the government in power. McDonald and Thornton (1998, p. 194) found that ten of the 27 Toronto firms in their 1994 study had engaged in manipulation of requirements or non-compliance in order to minimize their pay-outs, and one firm had no intention of complying at all. Moreover, the pay adjustments made under the Pay Equity Act were very modest: . . . on average fewer than 15 per cent of female workers in reporting firms received adjustments. [The] average pay adjustment was about 5 per cent of [a] female employee’s base salary. [The] average adjustment as [a] per cent of payroll was less than 1.5 per cent (McDonald and Thornton, 1998, p. 93).
Of the 27 firms five had given no pay adjustments to women, and eight firms gave adjustments to 10 per cent or fewer (McDonald and Thornton, 1998, pp. 192, 203). In 1995, when the Pay Equity Commission monitored 500 employers of over 100 employees, it was found that nearly 40 per cent had not posted all of their pay equity plans as required by the Act (Pay Equity Commission, 1996, p. 11). Smaller employers were found to be even less likely to comply (McDonald and Thornton, 1998, p. 200). These findings regarding the implementation of pay equity raise questions and concerns about employers’ implementation of employment equity, and point to the need for research to ascertain the extent of and reasons for non-compliance with employment equity requirements. The importance of enforcement of requirements, of compliance reviews, and of requiring employers to set goals for the representation of the designated groups has been documented in research on the implementation of affirmative action in the USA under the federal contractors program. Between 1974 and 1980, when affirmative action was vigorously enforced, employment of Black men and women increased significantly faster in contractor than in noncontractor firms, when establishment size, region, industry and occupational structure were taken into account. However this progress was arrested after 1980 when enforcement budgets and staff were severely reduced (Leonard, 1990). Moreover, Leonard found that compliance reviews had a significant positive effect on the employment of black women and men, in addition to the effect of coverage by the federal contractors program. The goals set by employers proved to be the best predictor of improved representation of Blacks and women after a year had passed, even though employers tended to set low goals, and most did not actually attain their goals (Leonard, 1990, pp. 55-6). In summary, our analysis suggests little convincing evidence that employment equity policy itself is fundamentally flawed. Results under employment equity have been disappointing primarily because of political compromises that have weakened the compliance-related provisions of the Act. In addition, it is likely that the weakness of monitoring and enforcement mechanisms, as well as the lack of sanctions for failure to make progress toward equity in the workplace, have indicated to employers that they need not take employment equity policy seriously. It can be argued that since employment equity policy is not being implemented, it is not possible to assess the strengths and weaknesses of the policy itself, and the theory upon which it rests. Further research is needed to examine the results attained when the Act’s requirements are implemented to a high standard, as compared with results when employers do as little as possible, and results for comparable organizations that are not covered by the act. A research evaluation is about to begin pursuant to the requirement that the Act be reviewed after five years. This study may shed additional light on the factors which contribute to the effectiveness and ineffectiveness of employment equity policy.
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The future of employment equity: challenges of the changing nature of work The past decade has seen significant changes in the structure of the labour market and the nature of work. As noted earlier, the public sector has experienced several years of downsizing, with especially large impacts on clerical occupations. Banks and other private sector employers in service industries have pursued a strategy of cost-cutting through restructuring and substituting technology services for services delivered by employees. These changes have brought negative impacts for women, including women who are members of visible minorities and aboriginal peoples: in 1996, over 50 per cent of employed women were in clerical and sales occupations (Human Resources Development Canada, 1999, p. 12). In the banks, women’s share of hirings fell from 76 per cent in 1987 to 59 per cent in 1998, largely because of a decline in the number of clerical jobs in banking (Canadian Human Rights Commission, 1999). On the other hand, the strategy of downsizing middle management in the public and private sectors has resulted in job loss for large numbers of men over the age of 50. This in turn has tended to bring about some narrowing of the wage gap between men and women, and some increases in the proportion of supervisory and middle management positions held by women and younger racial minority men. However these ostensible improvements do not result from employment equity efforts, but from the early ‘‘retirement’’ of older white male workers as a corporate cost-cutting strategy. The 1990s also witnessed a trend away from the creation and maintenance of traditional long-term full time jobs with benefits, toward contingent work. An increasing proportion of the jobs in the Canadian labour market are part time, temporary or contract positions, with limited or no benefits. Self-employment and very small businesses are also forming a growing portion of the Canadian economy. In 1998, part time jobs were held by approximately 22 per cent of all women, 27 per cent of Aboriginal women, and over 20 per cent of women with disabilities who were employed in the private sector, compared with 8 per cent of men . In the federal public service, only 11 per cent of all women hired in 1999 were given permanent positions, as compared with 22 per cent of men (Canadian Human Rights Commission, 1999). Chicha (1999) has noted that current trends such as these are resulting in the deterioration of women’s position in the labour market. She argues, further, that employment equity policy as it is currently framed is not likely to be effective in addressing some of these emerging realities. Employment equity policy assumes long-term jobs with somewhat specialized job descriptions, not the ‘‘flexible’’ and contingent jobs favored by many employers today, or the very small businesses or self-employment arrangements that are becoming common, particularly among women. The corporate restructuring and ‘‘flexible’’ strategies pursued by many firms today are likely to threaten benefits that are possible under employment equity policy, with negative impacts for women in particular. Indeed employment
equity policy and its enforcement needs to become stronger and more vigorous just to protect women’s position in the labour market from further deterioration. Conclusion The overview sketched above suggests that the promise of employment equity as a policy that can be effective in reducing the impacts of systemic discrimination in employment has not been realized to date. Weaknesses in implementation and enforcement need to be addressed. In addition, new approaches need to be developed in parallel with changes in the nature of work if employment equity is to realize its purpose. It will require political will to work toward a society in which systemic discrimination in employment is a part of the past rather than the future. Notes 1. In the Employment Equity Act (1995), ‘‘members of visible minorities’’ means ‘‘persons, other than Aboriginal peoples, who are non-Caucasian in race or non-white in colour’’. The term ‘‘persons with disabilities’’ is defined in the Act as ‘‘persons who have a long-term or recurring physical, mental, sensory, psychiatric or learning impairment and who (a) consider themselves to be disadvantaged in employment by reason of that impairment, or (b) believe that an employer or potential employer is likely to consider them to be disadvantaged in employment by reason of that impairment.’’ The definition ‘‘includes persons whose functional limitations owing to their impairment have been accommodated in their current job or workplace’’ (Human Resources Development Canada, 1999, pp. 26, 28). 2. For differences between the Canadian employment equity policy framework and affirmatve action in the USA, see Agocs and Burr (1996). References Abella, Judge R.S. (1984), Equality in Employment: A Royal Commission Report, Supply and Services Canada, Ottawa. Agocs, C. (1989), ‘‘Employment equity activity among federal contractors in Ontario’’, paper presented at the 1989 Conference of the Canadian Industrial Relations Association, Laval University, Quebec, June. Agocs, C. and Burr, C. (1996), ‘‘Employment equity, affirmative action and managing diversity: assessing the differences’’, International Journal of Manpower, Vol. 17 No. 4/5, pp. 30-45. Auditor General of Canada (1998), Report on the Canadian Human Rights Commission, Ottawa, Ch. 10. Canadian Human Rights Commission (1999), Annual Report, Halifax. Chicha, M.-T. (1999), ‘‘The impact of labour market transformations on the effectiveness of laws promoting workplace gender equality,’’ in Chaykowski, R. and Powell, L. (Eds), Women and Work, McGill-Queen’s University Press, Kingston, pp. 283-304. (The) Chilly Collective (Eds) (1995), Breaking Anonymity: The Chilly Climate for Women Faculty, Wilfrid Laurier University Press, Waterloo. Gagnon, Y.C. and Letourneau, F. (1996), ‘‘L’efficacite des programmes d’acces a l’egalite pour les femmes’’, Canadian Public Administration, Vol. 39 No. 2, pp. 136-56. Human Resources Development Canada (1999), ‘‘Labour standards and employment equity, 1996’’, Employment Equity Data Report, release No. 2, June.
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Human Resources Development Canada (1986), Federal Contractors Program – Information for Suppliers and Organizations, Quebec. Human Resources Development Canada (1998), Annual Report: Employment Equity Act, 1998, Minister of Public Works and Government Services Canada, Ottawa. Jain, H. and Hackett, R. (1989), ‘‘Measuring effectiveness of employment equity programs in Canada: public policy and a survey’’, Canadian Public Policy, Vol. 25 No. 2, pp. 180-204. Jain, H., Al-Waqfi, M. and Agocs, C. (1999), Racial Discrimination in Employment in Canada: An Analysis of Human Rights Cases, Canadian Race Relations Foundation, Toronto, December. Leck, J. and Saunders, D. (1992), ‘‘Hiring women: the effects of Canada’s Employment Equity Act’’, Canadian Public Policy, Vol. 18 No. 2, pp. 203-20. Leck, J. and Saunders, D. (1996), ‘‘Achieving diversity in the workplace: Canada’s Employment Equity Act and members of visible minorities’’, International Journal of Public Administration, Vol. 19 No. 3, pp. 299-321. Leck, J., St Onge, S. and Lalancette, I. (1995), ‘‘Wage gap changes among organizations subject to the Employment Equity Act’’, Canadian Public Policy, Vol. 21 No. 4, pp. 387-400. Leonard, J. (1990), ‘‘The impact of affirmative action regulation and equal employment law on black employment’’, Journal of Economic Perspectives, Vol. 4 No. 4, pp. 47-63. Lum, J.M. (1995), ‘‘The federal Employment Equity Act; goals vs implementation’’, Canadian Public Administration, Vol. 38 No. 1, pp. 45-76. McDonald, J. and Thornton, R. (1998), ‘‘Private-sector experience with pay equity in Ontario’’, Canadian Public Policy, Vol. 24 No. 2, pp. 185-208. McMullen, K. (1998), Restructuring Government: Human Resource Issues at the Workplace Level, Canadian Policy Research Networks, Ottowa, June. Pay Equity Commission (1996), Ontario, Annual Report 1995-1996, Pay Equity Commission, Toronto. Samuels, J. (1996), Visible Minorities and the Public Service of Canada, Canadian Human Rights Commission, Ottawa. Singh, G. and Reid, F. (1998), ‘‘Are seniority-based layoffs discriminatory? The adverse impact of layoffs on designated groups’’, Relations Industrielles, Vol. 53 No. 4, pp. 730-49. Stewart, P. and Drakich, J. (1995), ‘‘Factors related to organizational change and equity for women faculty in Ontario universities’’, Canadian Public Policy, Vol. 21 No. 4, pp. 429-48. Taggar, S., Jain, H. and Gunderson, M. (1997), ‘‘The status of employment equity in Canada; an assessment’’, Proceedings of the 49th Annual Meeting, Industrial Relations Research Association, New Orleans, LA, 4-6 January.
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Women in trade unions in India
Women in trade unions in India
C.S. Venkata Ratnam International Management Institute, New Delhi, India, and
Harish C. Jain McMaster University, MGD School of Business, Hamilton, Ontario, Canada
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Keywords India, Trade unions, Labour market, Women, Employee rights Abstract This paper on women in labour unions in India highlights the occupational segregation suffered by women in union structures. The authors explore and document the extent of female participation in trade unions in India. They suggest that less than 8 per cent of the 380 million workforce in India are unionized and women account for a very small fraction of trade union membership. They provide a number of reasons for the low female membership and participation in unions. In the occupations where women are organized, the incidence of union leadership among women varies considerably. On the positive side, the authors note that India has been a pioneer in organizing women in the informal sector such as workers’ cooperatives, self help groups such as Working Women’s Forum and Self Employed Women’s Association etc. In fact, they find that these unions are creating social unionism, thereby rewriting the meaning of trade unionism. The focus is on broad objectives of empowerment, development and fighting for their rights rather than the business unionism in North America (that is, focus on the bread and butter issues alone). The initiatives dictated by the Indian Constitution such as reservations or quotas for scheduled castes and scheduled tribes may have to be applied to labour unions and the private sector employers in the case of women in India. Policy makers and managers can learn a great deal from the theories discussed above.
Introduction Trade unionism in India has a history of about 100 years. At the time of independence in 1947, the national trade union centre in India had split into two. By mid 1970s, India has come to have five national centres – named below – each with a membership of over 500,000 spread over at least four states and four industries. The present study on the role of women in trade unions is based on literature survey and information gathered from the following major national trade union centers in India: . All India Trade Union Congress (AITUC); . Bharatiya Mazdoor Sangh (BMS); . Centre of Indian Trade Unions (CITU); . Hind Mazdoor Sabha (HMS); and . Indian National Trade Union Congress (INTUC). Three of them are affiliated to political parties. All unions have established a women’s wing, which deals with gender issues. Until the beginning of 2001 only twice and in only one national centre – Hind Mazdoor Sabha (HMS), which is not affiliated to any political party – the union
International Journal of Manpower, Vol. 23 No. 3, 2002, pp. 277-292. # MCB UP Limited, 0143-7720 DOI 10.1108/01437720210432239
International Journal of Manpower 23,3 278
was led by women: Maniben Kara and Kamala Sinha. The latter became the first and the only woman to have become Minister for External Affairs in the Union (national) cabinet in the late 1990s. Less than 8 per cent of the 380 million workforce in India is unionized. Women account for a miniscule fraction of trade union membership. There are sectoral variations in the pattern of women’s membership in trade unions. Over all, membership may be between 5 to 20 per cent. Women’s participation in labour force Women’s participation rate in employment at 22 per cent is very low. But it is not so in unorganised sector occupations (majority of the workers in the unorganised sector are women) where work is arduous, working conditions dirty, drudgerous and dangerous, wages low, occupational safety and health abysmally poor and social security virtually absent. Traditional sexual division of labor is pervasive. Research in India on the gendered division of labour and the relationship between production and reproduction has demonstrated the asymmetrical structural relationship between male and female workers. As Fernandes (1998) observes, while gender inequalities are linked to hegemonic cultural norms, they are also structurallybased identities that both shape and are produced by socio-economic processes Banerjee, 1991; Sangari, 1993). Table I shows data on women employed in the organized sector by major industry groups. Labor force participation is low among those who drop out of the workforce after secondary school and before graduation. It is relatively higher among the less educated and among graduates. Overall, women’s access to education and employment (as indicated by labor market participation rates) continues to be low. (The data shown in the table are based on the 1991 census. The 2001 census commenced in February and its preliminary results will be released in August-September 2001.) Major industry Agriculture Mining Manufacturing Electricity, gas, water Construction Trade, hotels Transport, storage and comm. Financing, insurance Community social and personal services Total
Total in ’000s
Women in ’000s
Percentage of total employment in the industry
1433.2 1118.7 6262.2 975.8 1217 470.5 3164.1 1576
490.3 80.6 731.5 36.8 64.8 39.3 160 204.5
34.2 7.2 11.3 3.7 5.3 8.3 5 12.9
11107.4 2420.1 21.7 Table I. 27524.7 4227.9 15.36 Women’s employment in the organized sector Source: Quarterly Employment Review, January-March 1995, Director General of by major industry, 1995 Employment and Training (DGE&T), Ministry of Labour (Ministry of Labour), New Delhi
Table II shows information on industries that employ more females than males. Women in trade Most of the industries where females outnumber males are in relatively low- unions in India paying sectors/occupations with very limited opportunities for career advancement. Mukhopadhyay (IAMR, 2000, pp. 559-61) observes that: Despite putting in long hours of labour as revealed by time-use studies, large chunks of work performed by women are not adequately captured by official data-gathering systems, leading to very low recorded work participation by women.
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Banning women from working on night shifts and in underground mines has further reduced the scope of employment for women. Trade unions are generally opposed to lifting the ban on working of women on night shifts, even though there is a great potential for employment in information technologyrelated areas involving tele-work in call centres, medical transcription, etc., where round-the-clock work is the norm. For a vast majority, even now women’s jobs and career are largely a function of male preferences and family circumstances. Three-fourths of the migrant women have migrated on account of marriage, which often means giving up either studies or employment if they had been pursuing either or both. Less than 3 per cent of females migrate for reasons of education or employment, while the corresponding percentage for males is nearly 32 per cent (Table III). The data are revealing in that the representation of women in formal/ organized sector occupations is quite low. Women are predominantly engaged Description 1. Processing, canning and preserving of fish, crustacean and similar foods 2. Processing of edible nuts 3. Manufacture of bidi 4. Cotton spinning other than in mills (charkha) 5. Preparatory operations (including carding and combing) on coir fibres 6. Spinning, weaving and finishing of coir textiles 7. Manufacturing of matches 8. Welfare services rendered by organisations operating on a no profit basis for the promotion of welfare of the community such as relief societies, creches, homes for the aged and physically handicapped, etc. 9. Domestic services
Number of workers Male Per cent female
NIC group
Female
203 215 226
14,215 61,761 1,454,224
13,938 31,092 648,316
51 67 69
231
150,159
109,718
58
252
17,975
9,471
65
255 307
53,936 91,638
30,974 40,816
64 69
941 960
170,177 562,396
99,921 410,527
63 58
Source: Registrar General of India, 1991 Census
Table II. Industries which employ more females than males, 1991
International Journal of Manpower 23,3 280 Table III. Percentage distribution of migrants by reasons
1981 Reasons Employment Education Family moved Marriage Othersa Total Total (million)
1991
Female
Male
Female
Male
1.9 1.0 14.3 73.4 9.4 100.0 145.2
31.8 5.1 30.3 3.3 29.5 100.0 62.5
1.8 0.8 11.0 76.1 10.3 100.0 167.8
27.0 4.8 26.6 4.0 37.6 100.0 64.3
Note: a Includes business, natural calamities like drought, floods, etc. Source: Registrar General of India
in informal/unorganized sector activities where wages and working conditions are inferior, largely unsecured and mostly devoid of social security benefits. Women outnumber men in the primary (agriculture) sector, both in relative and absolute terms. And, in the unorganized sector, even men are usually not unionized, yet. A substantial proportion of women in Indian industry were employed in the initial phases of industrialization, in jute mills in the east, particularly Calcutta (about 20 per cent) and textile mills (about 25 per cent) of the west, particularly Mumbai and Ahmedabad. Women were active in trade union struggles in jute and cotton textiles. A notable figure was Anusuyaben in Ahmedabad. As with men in trade unions in those years, she also came from an elite section of the society. During the artisan/craft guild stage, women were not allowed to be members even though they assisted their husbands/fathers and brothers in the workshops at home. In the factories, however, women were allowed to become members of the union from the beginning. The 1926 Trade Unions Act allows women to become members of trade unions. In the early days of industrialization and urbanization in India, men had one foot in the village and another in the city. They could retain their roots and go back to the village during harvest season, which usually remained for a long time as an alternative source of livelihood. In the case of women, migration to cities was near total alienation with the village, forced by marriage, desertion, widowhood or acute poverty. Once in the city, for work in the industry, she had to depend on a man either as wife or deemed wife, for protection in return for which she had to usually partake a part or all of her earnings besides carrying unpaid domestic work almost single handedly for the entire family. Relative to the middle class, working class women in India traditionally displayed more courage in demanding and exercising freedom and liberty, even though they did not have property rights. Middle class women have, for long, accepted subjugation, practice of sati (though banned in 1829, was prevalent in some parts of the country till late twentieth century) and denial of remarriage.
Legislation for women workers Women in trade India has a progressive Constitution, which believes in the ideals of justice, unions in India liberty and equality. The Constitution also guarantees the seven freedoms and endorses the key aspects enshrined in the Universal Declaration on Human Rights. India has enacted legislation on pay equity between men and women engaged in similar work in same organization (see Appendix for select 281 international labour standards concerning women and corresponding legal provisions in India). It is, thus, not the same as the ILO Convention on Equal Remuneration for Work of Equal Value. However, the legislation allows certain women’s organizations and non-governmental organizations to file petitions on behalf of affected women, even though their members are not directly affected by pay inequity. The Supreme Court has, while considering a case on sexual harassment, recognized the absence of provisions either in law or in company policies to deal with this growing social menace. Therefore, while delivering the judgment (in the case of Visakha and others), the court laid down the policy and procedure to deal with sexual harassment. The judgment also mandated all large employers to set up a committee, with a woman as chairperson and a women’s representative from a women’s organization or any other social welfare or non-governmental organizations to be a member of the committee. The logic was that a woman chairperson would be more sensitive to women’s needs and an outside women’s representative can play a significant role in encouraging reluctant conformers to fall in line, as well in dealing with cases involving senior managers at and above board levels. Thus the court has filled the vacuum created by inaction by the legislature, bureaucracy and corporate management. This judgment has since become the norm for all employers in civil service and public and private sectors. The Industrial Employment (Standing Orders) Act, 1946 has since been amended to make sexual harassment a misconduct. Above all, India has had a tradition of public interest litigation since the early 1980s, whereby an ordinary citizen or citizen’s group of any denomination can pursue the case of any woman who becomes a victim of lack of fairness and equity at workplace, without fear of reprisal and retaliation, even in the highest court of the land, free of court fee, etc. Courts have also pitched and stood by women exposed to inequity, in a context where government, employers and unions largely remained either indifferent and unconcerned, or reluctant and ineffective in addressing the issues of gender equality. For instance, in the state-owned and state managed domestic and international airlines, Indian Airlines and Air India respectively, there was a time when women were recruited as air hostess if they were pretty and remain unmarried. They were asked to retire at around 32 years age. Women fought legal battles and won the right to remain on job after marriage and beyond 32 years age if they so wished. When the managements insisted that they should not get pregnant and bear children, the courts again intervened and said that it was unconstitutional. The persistent air line managements then brought new regulations, at two different times, that sought to ground women if they became obese or if their pay exceeded that of co-pilot.
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On these occasions too, the courts asked the managements to behave. Since then managements got sobered and ceased to be obstructionists. Yet, not every company management learns from the experience of other managers. The Indian Railways, a departmental undertaking of the Government of India, insisted that if a parent is working and living in the accommodation owned and leased by the Railways, upon the retirement of the employee, the male child could be allotted the accommodation if he happens to work for the Railways. Such privilege is denied to women employees who happen to be descendants of Railway employees, even in cases where male and female children of the same retired employee happen to be employed in the railways and the parent argued that his son virtually disowned them and that he (the retiring employee) had more trust in his daughter; therefore she should be allotted. The employee had to move the court to make the railways relent and stop gender discrimination. Sometimes legislation meant to protect women workers has proved counterproductive to the interests of women workers. For instance, Factories legislation in India prohibited employment of women in night shifts and in underground mining work. It also provided for amenities like breast-feeding breaks and creches when the number of women working in a factory exceeds a critical mass. Maternity leave is made mandatory by a separate law. Yet, these very measures are perceived by most employers to be liabilities and dissuaded them from employing women altogether where shift work and mine work is involved. Quite a few employers in the private sector consider even maternity leave to be an avoidable liability, even as a few progressive employers have considered it appropriate to introduce paternity leave. Unionization among women workers Majority of women employees in India are in engaged in informal sectors jobs where there is no clear employer-employee relationship. In the export processing zones (EPZs) they live in distant, dispersed areas and work for long hours. Thus they have less time, energy and opportunity, particularly because they need to go home after work and tend to domestic chores, usually without support from the male members of the family. They are represented mostly in separate women’s wings. It is only in recent years that some of the national trade union centres in India have announced that if their affiliates send nominations for representation at various decision-making levels in the union hierarchy without a women’s member in the panel, they will not consider the entire panel suggested them. Even here, they are talking about at least token representation. At this rate, it will be a long time before they get equal representation at decision-making levels at any level, and more so if it is at the highest level. The incidence of union membership and union leadership among women is higher in certain occupations than in others. In garments, the proportion of women to total members could be up to 70 per cent. In plantations, hospitals, hotels, telecommunications and public service, women occupy positions as joint secretary/secretary. In teaching and nursing they hold even higher positions.
At the sectoral level, another exception was the textile industry in Women in trade Ahmedabad. Ahmedabad Textile Labour Association was founded by unions in India Mahatma Gandhi, the Father of the Nation who secured independence for the country through the non-violent movement. In the 1960s, Anusuya Ben was leading the union in Calico Mills when the second experiment in the world using socio-technical systems approach by A.K. Rice in Tavistock Institute in 283 London was conducted. Incidentally, Anasuya Ben was related to the family which owned the mill. Subsequently, the women, leader who won international fame for organising the unorganized sector women, initially in and around Ahmedabad, is Ela Ben. She started this activity while being part of the Ahmedabad Textile industry and in view of the difficulties she had to face within the traditional union movement to espouse the cause of self employed women, she founded an organisation called Self Employed Womens’ Association (SEWA). Today, SEWA is reckoned as one of the outstanding examples – not only in the developing countries but through out the world – in organising self-employed women. Ela Bhat’s contribution to the labour movement was recognised by the government. She was made the chairperson of the National Commission on Women and more recently (October 1999) she was appointed as a member of the 2nd National Commission on Labour. On similar lines as SEWA, Jaya Arunachalam has organized self-employed and unorganised sector women in four southern states, under the banner, Working Womens’ Forum (WWF). In the plantation industry in north Bengal, Sarkar and Bhaumik (1998) studied 157 women workers to ascertain the involvement of women workers in trade unions. They observed that though women form half the workforce in the plantations, they have remained marginalised in the trade unions of plantation workers. Of the 157 women workers studied, three did not join any union and 74 (47 per cent) changed unions at the behest of their fathers/husbands. Only 17 women (11 per cent of the sample) regularly attended union meetings and participated in the meetings. About 65 per cent were occasional participants and the rest did not participate at all. Only five of the 17 women hardly ever took part in negotiations with employers or conciliation before government machinery. Even those five indicated that they merely observed the proceedings and had never given their opinions! Yet, interestingly, Sarkar and Bhaumik (1998) observe that while this might be interpreted as a passive and submissive attitude on the part of women workers in plantation, in reality, when pushed to the wall or provoked through abuses or unfair actions by managers, it was the women in these plantations who first took the initiative to organise spontaneous protests and the men joined in later on. Thus, women have potential, which is not harnessed usually except in times of dire crisis. Organizing women workers in the unorganized sector Martens (ILO, 1994) observes that India has long taken the lead in organizing women in informal sector. Datt (1997) and Radhakrishna and Sharma (1998) note a varied pattern of organisation such as trade unions, workers’
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co-operatives and self-help groups on specific issues. Women and others in precarious employment are increasingly organised through empowerment groups. Kannan (1999) says, they are rewriting the meaning of trade unionism by creating social unionism that stresses struggle as much as development and is not narrowly based on the pecuniary logic alone but primarily on an associational logic. In mid-1990s, several organisations organising and mobilising men and women workers in casual, construction and contract jobs have established National Centre for Labour (NCL), as a conscious effort to overcome organisational segmentation by uniting workers regardless of their work and gender status and sector and region background. It also tried to avoid politicised polarisation by not having the NCL affiliated to any political party. Bhat (1997) reports on the organisation she founded and nurtured, i.e. Self Employed Women’s’ Association. Kannan and Sreekumar (1998) reflect on fishworkers in South India. Ramaswamy (1997) examines the issue from a gender perspective. Selliah (1989) and Bangasser (1994) document the role of Working Women Forum and Self-Employed Women’s Association in organising women workers in the informal sector. Bangasser (1994) showers lavish praise on the role of WWF in fostering and nurturing a culture of leadership through: . leadership from below (Chambers, 1986), participative and nonhierarchical, where members know that, their wisdom being recognised, they have direct access to decision making; . a path to leadership open to all by leadership training tailored to the milieu in which it is offered, with a system whereby leaders are automatically elected or appointed for every ten members they can gather; and . a newly born ‘‘networking in sisterhood’’, whereby the forum is now sharing its experiencing and successes with kindred organisations all around the world. Selliah (1989) notes women workers’ concerns thus: The efforts to organise rural women disturbed the traditional relationship between men and women. The men in villages, who, in fact, resisted the organisation of women, did not easily accept that women should learn new roles as organisers, trainers and group leaders. In the poorest families, any extra income was welcome to the males and to that extent they supported the union’s activities. But at the community level, the men found it very difficult to accept equal status for women. When women persisted, the men might even become unbalanced and assault them. Over the years, the situation has improved considerably and a better understanding has been established.
Though Kannan asserts that tribal women in plantations in north-east have less to fear from their husbands, it is so because the women there have accepted to be subordinated by men! Gopal’s (1999) study on women workers in beedi (that is, Indian indigeneous cigarette) industry also points out how the social perceptions of women’s work and their prevailing low status in the community is built into the production
process. She argues that by employing a system of production using Women in trade contractors and home-based workers, the beedi industry is able to gain unions in India tremendous profit with little inputs in infrastructure and comprehensive benefits to labour. The concept of home workers as housewives and homework as a practice: . . . allows a woman to care for children and perform her household tasks while earning much needed income completely distracts from the fact that, not only do women put in long hours to fulfil production targets set by employers but have no idea as to how they arrive at the wage levels they set.
Even at the sectoral level, except in nursing and teaching where women are represented in large numbers, it is unusual to find a women either as president or general secretary. Even the Nurses Association was led for many years by a male person. Even when some women were given office bearer positions in the railway workers’ union, the union is still called ‘‘Railwaymens union’’. Why women do not join unions Fewer women join trade unions and even the few who join do not participate actively in trade union matters in India. In several programmes organized by the ILO and international trade union organizations (like ICFTU, WFTU, ITSs), usually the sponsors ask for gender balance in the nominations. Still, very rarely, if ever, Indian trade unions are known to send women members/ leaders for participation in national events. The one exception relates to the programmes organized by Public Services International (PSI) where women’s representation is insisted and obtained in almost equal measure. Thus, trade unions have generally become a men’s affair in India. Participation of women in trade unions is very low for a number of reasons such as the following: (1) Family responsibilities such as child care, and all household duties are left mainly to women. This means that a woman who is active in her trade union usually has triple burden of family responsibilities, her work, and trade union activities. (2) Traditional roles and stereotypes: religion, taboos and cultural inhibitions make it difficult for women to break into male environments. This is because women are often socialized to play subordinate roles to men. This can result in a lack of confidence when it comes to assuming public and leadership roles. (3) Job segregation in workplaces when women are often employed in subordinate position under the supervision of men in more powerful positions. Union structures, which reflect occupational segregation, can create barriers for women’s advancement. The fact that the large numbers of women are found in only a handful of occupational groups leads to only a few women being represented on committees and bargaining teams. It is also difficult for a woman in a low status job to represent workers in higher grades.
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(4) Trade union environments are often male dominated because of the following: .
the notion that working in the union is a 24-hour-a-day-job;
.
tendency to have meetings at night;
.
union jargon and sexist language;
.
informal male structure (the ‘‘old-boys’’ network);
.
little encouragement for women;
.
less interest in women’s issues;
.
less access to education and training for women in many places; and
.
lack of physical infrastructure to take care of basic needs like childcare and toilet facilities and safe, convenient and affordable transportation facilities at union offices.
Women’s representation and gender issues in collective bargaining A survey of over 200 collective agreements signed by nearly 1,800 trade union leaders revealed that less than five out of 1,800 were women trade union leaders who formally participated in collective bargaining and signatories to collective agreements (Venkata Ratnam, 2001a). Another survey of social dialogue in public service in India (Venkata Ratnam, 2001b) revealed that even though the Government of India has instituted Joint Consultation Machinery (JCM) on the lines of Whitley Councils in the UK, since its inception in late 1960s to date, not even once has a woman been ever given representation from the staff (employees) side, even though the government has often reminded the trade union representatives in public service about it on several occasions. It is only in the banking industry that in 1987 in the computerization agreement a special clause was introduced for the time permitting pregnant women to refuse work before computer terminals. This was apparently due to perceived health hazard to the women concerned and the baby in the womb. Though 14 years have lapsed since then and many industries have come to use computers more extensively, in no other industry – including electronics and software and medical diagnostics, to name a few – has a similar clause been incorporated! In some modern and new economy enterprises (information technology, entertainment, communication, etc.), family friendly human resource policies are being introduced. These include paternity leave, extended career breaks, flexi hours of work, part-time work during child rearing stage, and incentives to employees who let their elder, dependent parents live with them. Some of these measures, like the last mentioned one, are not completely altruistic in nature. The following four points comprise an illustrative list of gender issues that can be taken up in collective bargaining:
(1) Equal pay for equal work. India has ratified ILO Convention NO.100 and Women in trade enacted Equal Remuneration Act. Though the scope of Indian legislation unions in India is limited and does not fully incorporate the spirit and substance of the ILO Convention concerning equal remuneration for men and women workers for work of equal value, it provides for womens’ organizations and non-governmental organizations to take up cases of violation of the 287 principle of equal pay for equal work. Still, neither unions nor women’s organizations have seriously taken up the cases. Trade unions can look for the following indicators for identifying potential bias and discrimination in pay: . gender-neutral job evaluation schemes to ensure that there is no gender-based segregation in the classification and evaluation of job titles, job grades, skill levels, qualifications, etc.; . comparison of women’s earnings with that of males in similar jobs/ grades, with separate arrangements, if any, based on gender, for part-time/temporary jobs, allowances, overtime, bonuses, and other benefits/entitlements; . hours of work and working conditions; . flexible hours; . transportation and escort facilities for night work; . working women’s hostels; . health, safety and physical working environment; and . measures to prevent sexual harassment. (2) Special provisions for workers’ with family responsibilities: . flexible working time; . job sharing; . night work; . reasonable accommodation for expectant and nursing mothers; . maternity/paternity leave; . welfare facilities and services including creche, kindergarten, etc.; . career breaks; . counseling; and . education and training. (3) Health and physical working environment: . exposure to chemicals and other hazardous substances at working place; . carrying of heavy weights; . management and disposal of hazardous wastes;
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use of protective equipment, etc.; ventilation, light, temperature, noise, vibrations, working positions, etc.; and . impact of new technologies such as visual display units, etc. (4) Other, emerging concerns: . HIV and aids information; . reproductive health; . job security; and . representation in workplace committees, etc. . .
Gender equality in trade unions – contribution of international trade union movement The International Confederation of Free Trade Unions (ICFTU) adopted at Amsterdam Congress in 1965 and revised in 1975 and 1985 the ICFTU Charter of Rights of Working Women as following: . equal rights and opportunities at work; . maternity protection for all working women; . sharing of work in the family; . a place for women in grass roots and at the top of the union; and . action in wider world to respond to women’s needs. The Asian Pacific Regional Organization of ICFTU (ICFTU-APRO, 2000) adopted a Social Charter for Democratic Development at its 64th Executive Board Meeting held in Seoul, Korea. It called upon the unions to work for ensuring: . positive action of empowerment of women; . gender perspective in all union work; and . equality in law and practice. The Beijing Platform for Action (1995) identified 12 common areas of concern for particular attention: poverty, education and training, health, violence against women, armed conflict, economy, power and decision-making, institutional mechanisms for gender equality, human rights, media, environment, and the girl child. It invited trade unions as one of the key social partners in achieving gender equality. Monitoring gender equality in trade unions Unionization density and representation at the highest decision-making roles is low among women, not only in India but also in most other parts of the world. Table IV provides interesting insights from a study by International Confederation of Free Trade Unions of 55 national trade union centres and 160 trade unions at industry/enterprise level. In three out of four national centres
Per cent of women Less than 30 30-39 40-49 50-59 60-69 70-79 80-89 90 and above Do not know No answer
No. of unions with per cent women in total membership NC TU 13 11 12 7 6 1 – – – 7
48 13 17 25 6 13 11 8 3 16
No. of unions with per cent women in highest decision-making body NC TU 38 7 4 3 1 – – – – 4
88 18 13 8 9 8 5 5 – 6
Notes: NC: National trade union centres; TU: Trade unions at industrial enterprise level Source: ILO (1998)
and in about one out of every two trade unions covered, women’s membership is less than 50 per cent of the total members. In 49 out of 55 national unions and three out of four trade unions, the proportion of women in highest decisionmaking positions was less than 50 per cent. What is even more disconcerting is the rather lackadaisical attitude of even non-governmental organizations and women’s fora, which have been vested with the right to pursue cases of continued discrimination in pay and remuneration and in fighting sexual harassment. In the recent debates on lifting the ban on night work for women, many trade unions and several women’s organizations have even preferred the status quo ante. All things considered, trade unions should identify and discuss the following in their union meetings at local, regional/sectoral, national and international level: (1) Identifying and breaking sexual division of labour. (2) Women as percentage of total workforce. (3) Women as percentage of total members. (4) Percentage of leadership positions held by women in the union at the: . International Trade Union Fora (including ITSs); . principal office bearer positions and membership in National Working Committee, General Council and Executive Board; . principal office bearer positions at general council and executive board at sectoral/local unions; . membership in tripartite and bipartite fora at national, regional/ sectoral and enterprise/local level; . training programmes conducted at international, national, regional/ sectoral and local level; and
Women in trade unions in India
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Table IV. Percentage of women in unions in Asia-Pacific
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.
paid positions beyond secretarial jobs in trade union secretariats at international, national, regional/sectoral and local level.
March 8 has been commemorated every year as the International Women’s Day by all trade unions in the world, since on this day in the beginning of the last century, hundreds of women garment and textile workers went on strike in New York city protesting against low wages, long working hours and inhumane working conditions. The ICFTU-APRO considers ‘‘full participation by women is a certified check for broad-based and far-reaching democracy equality.’’ On the Women’s Day in 2000, it resolved to focus intense attention on the following: . democratic and rightful participation in all trade union work; . organizing for equality; . equal wages for work of equal value; . education and training for women; . an end to sexual harassment; . maternity protection; . fair representation and positive actions; and . sharing of family responsibilities. References and further reading Bhat, E. (1997), ‘‘SEWA as a movement’’ in Datt, R. (Ed.), Organising the Unorganised Workers, Vikas, New Delhi. Banerjee, N. (Ed.) (1991), Indian Women in a Changing Industrial Scenario, Sage Publications, New Delhi. Bangasser, C.L. (1994), ‘‘The working women’s forum: a case study of leadership development in India’’, in Martens, M.H. and Mitter, S. (Eds), Women in Trade Unions: Organising the Unorganised, ILO, Geneva. Chambers, R. (1986), The Working Women’s Forum: A Counter-Culture by Poor Women, Institute of Development Studies, University of Sussex, Brighton. Datt, R. (1997), Organising the Unorganised Workers, Vikas, New Delhi. Fernandes, L. (1998), ‘‘Class, structure and working class politics’’, Economic and Political Weekly, 26 December, pp. L53-60. Gopal, M. (1999), ‘‘Disempowered despite wage work’’, Economic and Political Weekly, 17-14 April, pp. WS12-20. Government of India (1974), Annual Report on the Working of Equal Remuneration Act 1976 for the year ending 1992, Office of the Chief Labour Commissioner, Ministry of Labour, Government of India, New Delhi. Government of India (1975), Towards Equality: Report of the Committee on the Status of Women India, 1974-75, New Delhi. Government of India (1988), Shramshakti: Report of the National Commission on Self-Employed Women and Women in the Informal Sector, New Delhi. Government of India (1992), Report of the National Commission on Rural Labour, New Delhi.
Government of India (1995), Standard Note on Women Labour, Women’s Cell, Ministry of Labour, Government of India, New Delhi. Government of India (2000), Ministry of Labour – Annual Report, 1999-2000, New Delhi. IAMR (2000), Manpower Statistics, 2000, Institute for Applied Manpower Research, New Delhi. ICFTU-APRO (2000), Women and Trade Unions in the New Millennium, International Confederation of Free Trade Unions – Asian Pacific Regional Organization, Singapore. ILO (1986), ‘‘Equal remuneration: general survey by the committee of experts on the application of conventions and recommendations’’, report presented at the 72nd Session of the International Labour Conference, ILO, Geneva. ILO (1994), Report of the Committee of Experts, ILO, Geneva, pp. 306-7. ILO (1994), Women in Trade Unions: Organizing the Unorganised, ILO, Geneva. ILO (1998), Executive Summary: The Role of Trade Unions in Promoting Gender Equality and Protecting Vulnerable Women Workers – First Report of the ILO-ICFTU Survey, Gender Promotion Programme Employment Sector, ILO, Geneva. ILO-ACTRAV Advanced Regional Trade Union Training Programme (2000), ‘‘Workers education assistance in management training for trade unionists in select Asian countries’’, RAS/96/MO9/DAN, Trade Union Organization and Leadership Development Programme: Vol. 3, Module 12: Gender Equality in Trade Unions, ILO, New Delhi. Kannan, K.P. (1999), ‘‘Changing economic structure and labour institutions in India: some reflections on emerging perspectives on organising the unorganised’’, Indian Journal of Labour Economics,Vol. 42 No. 4, pp. 753-68. Kannan, K.P. and Sreekumar, T.T. (1998), ‘‘Rural labour movements and organisations in India: a case study of fishworkers’ struggle in Kerala’’, Labour and Development, Vol. 3 Nos 1/2. Kapur, A. (1999), Women Workers’ Rights in India: Issues and Strategies: A Reference Guide, Training and Information Dissemination on Women Workers’ Rights – India Project, ILO, New Delhi. Martens, M.H. and Mitter, S. (Eds) (1994), Women in Trade Unions: Organizing the Unorganized, ILO, Geneva. Mazumdar, V. (1998), ‘‘Women from equality to empowerment’’, in Karlekar, H. (Ed.), Independent India, The First Fifty Years, Oxford University Press, New Delhi. Mukhopadhyay, S. (1997), ‘‘Locating women within informal sector hierarchies’’, The Indian Journal of Labour Economics, Vol.40 No. 3, pp. 383-492. Pandey, P.N. (1989), Implementation of Equal Remuneration Act, 1976 in the State of Uttar Pradesh, Giri Institute of Development Studies, Lucknow. Thorat, M. (1994), ‘‘Labour administration enforcement and gender’’, in Joseph, C. and Prasad, K.V.E. (Eds), Women, Work and Equality, National Labour Institute, Noida. Pandey, P.N. (1989), Implementation of Equal Remuneration Act, 1976 in the State of Uttar Pradesh, Giri Institute of Development Studies, Lucknow. Radhakrishna, R. and Sharma, A.N. (1998), Empowering Rural Labour in India: Market, State and Mobilisation, Institute for Human Development, New Delhi. Ramaswamy, U. (1997), ‘‘Organising with a gender perspective’’, in Datt, R. (Ed.), Organising the Unorganised Labour, Vikas, New Delhi. Sarkar, K. and Bhaumik, S.K. (1998), ‘Trade unions and women workers in tea plantations’’, Economic and Political Weekly, 26 December. Sangari, K. (1993), ‘‘Consent, agency and the rhetoric’s of incitement’’, Economic and Political Weekly, 1 May. Selliah, S. (1989), The Self-Employed Women’s Association, SEWA, Ahmedabad.
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Venkata Ratnam, C.S. (2000), Social Dialogue in Public Service in India, a study sponsored by the Social Dialogue Sector in ILO, International Management Institute, New Delhi. Venkata Ratnam, C.S. (2001a), Collective Bargaining: A Response to Liberalization and Restructuring at Enterprise Level, a study sponsored by Planning Commission, Government of India, International Management Institute, New Delhi. Venkata Ratnam, C.S. (2001b), Collective Bargining: A Response to Liberalization, International Management Institute, New Delhi. Appendix International labour standard
Indian constitution/laws
Discrimination (Employment and Occupation) Convention (No. 111), 1958
Constitution of India, 1950 stresses the principle of equality and makes gender-based discrimination unconstitutional Guidelines laid down by the Supreme Court in the case of Visakha vs State of Rajasthan, 1997 Some state governments provide for 30 per cent reservation for women in educational institutions Affirmative action for recruitment, training and promotion of women. Several government departments and public sector organizations now prepare and monitor gender ratios in these matters Factories Act, 1948 and Mines Act, 1952 provide that women may not be engaged in night work in factories and mines There are also legislative provisions prescribing maximum weight loads assignable to woman and young workers Childcare facilities: creche if more than 30 women workers are employed in the workplace under the Factories Act. Creche facility if more than 50 workers are working under the Plantation Labor Act, 1951 and Building and other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996 Higher income tax rebate/exemption level for women employees
Human Resource Development Convention (No. 142), 1975 Employment Promotion and Protection (Unemployment Convention, No. 168), 1988
Employment Policy Recommendation (No. 169), 1084 Equal Remuneration Convention (No. 100), 1951 Maternity Protection Convention (Revised (No. 103), 1952
Workers’ with Family Responsibilities Convention (No. 156), 1981 Table AI. International labour standards and Indian legal framework
Equal Remuneration Act, 1976 Maternity Benefits Act, 1961 providing 12 weeks’ paid leave. Two nursing breaks until the child are 15 months old A worker on maternity leave cannot be dismissed from service during her absence Dual career planning and common postings/transfers in government Paternity leave in government and in some companies through collective agreement or otherwise Some companies provide for career breaks, part-time/home work and flexible hours for workers’ with family responsibilities
Book reviews Work Transformation Ken Robertson HNB Publishing New York, NY 1999 286 pp. ISBN 0-9664286-0-9
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This book looks at ways of ‘‘work transformation’’. It deals with planning and implementing the new workplace. To cope with an economy that is rapidly changing, organizations need to revisit the way of doing work. Organizations need to redefine work methods, more specifically how and where employees work. The initial chapters introduce the concepts and these have been explained in details in subsequent chapters. The author has given examples of organizations that have implemented some of these concepts. He has suggested ways of implementing work transformation. Considerable focus has been given to the practical aspects of implementation. Work transformation has to be done in the context of external changes. Indeed, various aspects of working life have been changed recently. There is an increase in the percentage of professional/knowledge workers, there has been a flattening of organization structures, and technology has been replacing portions of work being done by people. Significant changes have taken place in demographics and lifestyle choices. The trend shows an increasing number of women in the workforce. There is also a growing number of men who are single parents or who are taking a much more active role in parenting. These developments have led the employees to look for more flexible options that will help them balance work and family life. Advances in technology have also changed the way work is being done. In this context, the author has developed several ideas to transform the way work is being done. He has raised questions such as: .
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Is it necessary for all employees to work at a central location? Alternatively, would it be better for some employees to work closer to their customers? Why should managers get large offices with closed doors? Can there be alternative ways of dealing with those meetings that require privacy from time to time? Do employees have to work specific hours of the day and specific days of the week? The old concept of work does not hold in a global economy where customers are located in different time zones.
International Journal of Manpower, Vol. 23 No. 3, 2002, pp. 293-304. # MCB UP Limited, 0143-7720
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The various options suggested in the book revolve around alternative work arrangements (AWAs), alternative space arrangements (ASAs), and ways of tapping the benefits of technology. Some of the alternative work arrangements are: . variable work hours or flexitime; . regular part-time; . modified work week where people reschedule their work so that they work longer hours per day, but fewer days over a pre-defined work cycle; . phased retirement helping individuals to retire gradually by reducing their full-time employment commitment over time; . job sharing where two employees with similar skills and experience share the job; . telecommuting; . work at home; and . mobile work for employees who work from multiple work locations. There is a brief explanation of each of these methods. The author has articulated that alternative work arrangements are voluntary. He has given examples to show how most organizations can benefit by applying AWAs. Sales persons could use the benefits offered by mobile work, while employees who work on the manufacturing floor may take advantage of modified work weeks. The alternative space arrangements have been categorized as on-premises options and off-premises options. The suggested on-premises options are: . teaming space which is a space shared by the entire team; . shared office where two or more employees share a single assigned space; and . nonterritorial space which is based on the concept that no one is permanently attached to any single workplace. Employees select the workplace that meets their specific requirements at any given point of time. The off-premises options are mobile offices, telework centers, guest space, and home office. Work transformation is enabled by various technologies, including the Internet, e-mail, voice mail, networking, and other tools that facilitate workgroup computing, conferencing, etc. Workgroup computing enables people to work together more effectively as it facilitates information sharing and interaction with each other. Conferencing solutions help to reduce geographical constraints; technology facilitates audio and video conferencing. The book discusses potential business and employee benefits. Enhanced job performance, more effective communications, enhanced focus on results,
reduced office space costs, improved job satisfaction, ability to attract/utilize people with disabilities and improved customer service are some of the potential business benefits. Among the potential employee benefits are reduced stress, opportunity to balance work and family, reduced conflicts between work and personal schedules, cost savings, ability to work during personal peak performance times, and improved morale. Gaining management support is an important aspect in the process of work transformation and this has been articulated in detail. The author has covered these in the form of strategy, assessment of the appropriateness, and building a business case. Before making a presentation to the entire organization, it is important to do the necessary research, find an executive champion and develop a shared vision of the concepts. The assessment process will help the organization determine the appropriateness of the concepts. The business case presents the strategy, the details from the assessment process and the cost-benefit angle. From time to time, it is important to review the program and fine-tune it to ensure that the momentum is sustained. All through the book, the importance of human resources, facilities management and information technology is highlighted. The structure and flow of the book suits the needs of different readers. Those who have a fair depth of knowledge in any of the three areas covered in the book can skip the chapters which describe the concepts in detail. They can focus on the chapters that deal with management support and the implementation. The Web-site bibliography, at the end of the book, gives ample scope to those who want to browse for more details. The diagrams in the book help to explain some of the concepts related to alternative space arrangements and to the technological solutions. What I like about this book is that it does not read like a recipe for success. It gives ample scope and ideas that enable the readers to tailor the design and implementation of work transformation to suit their requirement. It has been organized around the key themes of human resources, facilities management and information technology and I felt that their inter-dependencies have been articulated clearly. The questions in the initial chapters are thought provoking and they deal with challenging issues. The language used is simple and all jargons are explained. The detailed elaboration of the concepts may be a double-edged sword. It can be tedious for those who know these concepts. I felt that some of the diagrams tend to distract the attention and they could have been placed in an Appendix at the end of the book. The author could have made it a more enriching experience for the reader by elaborating the experiences of organizations that have implemented these concepts. Overall, the book does cover important points in the area of work transformation. It covers the cycle from concepts to implementation and it offers the reader sufficient information to embark on the journey. Mohan Bangaruswamy Wipro Infotech Software & Services, Bangalore, India
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Diary of a Change Agent Tony Page Gower Press Aldershot 1998 288 pp. ISBN 0 566 07779 5 (hardback) ISBN 0 566 08093 1 (paperback) The book is a diary of a consultant over a period of three years. Unlike many diaries, it is not merely a continuous account of events and encounters telling a rather continuous story. Instead, each episode or event is followed by a titled paragraph which highlights the value that the episode had created. The main reason for writing the diary, in the author’s own words, was: I wanted to understand why clients engage me, what the longer terms of our work together really were and how best to create value with, and for, the client (p. 8).
Value is conceived as a wide array of gains, achievements, and contributions including time, money, appreciation, a better job, better relationships and so forth. And since all of us, consultants included, operate in social contexts most of our life, all partners to social encounters strive for value for themselves but at the same time have to take into consideration their role-partners’ value strivings as well. In a word, this may be seen as the art of interpersonal relationships in general and the consultant-client relationships, the focal interest of the diary. Creating value for all parties connected with an organizations is, thus, a complex issue since the different parties have different perspectives of what is ‘‘value’’ for them; customers, employers, shareholders, and employees, each has its own preferred states. Therefore, adding value to one client, say management, does not necessarily go together with needs of employees or customers. Creation of value is also a key theme in the work of many other professionals such as nurses, physicians, accountants, CEOs, or social workers. Viewed in this way, the diary may be of interest not only to individuals involved in organizational consultation in the strict sense, but also to audiences such as those just mentioned and probably many others. Creation of value, in the author’s opinion, is essentially a question of relationships with the client. He believes that the tough part of consulting is not the task-oriented activities but the creation and maintenance of relationships with the client. The author presents five phases of personal transformation that the author underwent throughout the three years period covered by the diary. Transformation, according to the author, is a ‘‘paradigm change’’, or a three stage route of thesis, antithesis, and synthesis or the harmonization of conflicting ideas into a synthesis. The ability to create synthesis from conflicting cognitions is particularly important in the current global world where perceptions, concepts, beliefs and realities are constantly being
challenged by the turbulent changes in most aspect of life, including the realities of organizational life and those of each individual as a working person and career person. Even those persons who are unaware of the need to detach oneself and reflect upon the meaning of events they underwent are, in fact, enforced by the changing realities to do so. For organizations and their consultants, as well as for many professionals, the need for constant inwardlooking is a question of professional life and death. Learning is, therefore, another key concept in the book; consultants have to learn, adapt, and become aware of the meaning of inner and environmental events and changes, and have to be aware, and alert their clients to what they have to learning from changes. There are varied ways to achieve transformation – through meditation therapy, coaching and so forth. The way preferred by the author is through conversation – a dialogue between two persons or a small group conversation. To achieve transformation through conversation requires, first, an awareness of its importance and secondly, creating a appropriate setting and time for such conversations. The author offers several methods and exercises to achieve this. The main ingredients are: . setting time aside; . listening; . accepting; . building on ideas; and . connecting. Those elements create result in ‘‘flow states’’ which are the essence of transformation conversations. The turbulent world in which all of us live requires both personal and corporate transformation to survive and to thrive. The author rightfully notes that this need had never been so important and urgent as it is in current times. He sees the conversation as an efficient tool to achieve transformation of the consultant, the consultee, and the organization as a whole. Despite some risks, constant transformation is a necessary condition to achieve personal satisfaction and high quality performance. The author had chosen the diary technique as a method for his personal continuous learning, and suggests this method to others as well. He recommends it as a way of understanding and reflecting one’s own feelings. At the same time, this is also a necessary step to understanding others. The diary method is based on asking yourself several questions and through answering them, the individual gains the insight that is needed for stating and achieving value for oneself and for one’s clients and customers. The book itself is an example on how to use the diary method. The author views it as an example of a ‘‘learning diary’’. Based on its format, one may call it a ‘‘didactic diary’’. It is simultaneously the author’s own diary over a three years period, and teaching tool for readers who may be interested in starting their own diary. Many of the descriptive episodes are followed by distinct
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sections which spell out the lessons that the author wants his reader to learn. It is quite interesting but indeed, somewhat too didactic in my view. In many of the episodes described in the book, the ‘‘moral’’ (the created value), is quite obvious to the skilled reader and therefore, the interruption of the flow of the diary by indicatory paragraphs is an unnecessary interference which diminishes the interest created by the sheer description of events and encounters with clients. I consent, though, that those clarifying paragraphs may carry much more value and significance for students or consultants in the early stages of their career or for other professionals with less background in psychology or related social sciences. For the latter, description alone may not suffice. The diary method is without doubt a very interesting and useful way for people to achieve their personal flow state and eventually a personal transformation. It is not always the most appealing format for the reader, or rather, there are probably large individual differences in regard to that appeal. For me, the flow of reading and enjoyment was somewhat interrupted by ‘‘flashes of the blindingly obvious’’, ‘‘value statements’’, or ‘‘exercises’’ which follow many of the descriptive sections. Moshe Krausz Department of Psychology, Bar-Ilan University, Israel
Sociology and the Future of Work: Contemporary Discourses and Debates P. Ransome Ashgate Aldershot 1999 x + 297 pp. ISBN 0 7546 1159 0 (hardback) Paul Ransome’s book is a contribution to debates in the sociology of work. Its focus is on those theoretical approaches which seem to offer useful perspectives, rather than on the presentation of empirical work. As such it offers a good deal of food for thought, but it is not clear who the book is aimed at. From the rather chatty introduction (‘‘Imagine, for example, that we are standing in the High Street asking different kinds of people what they think the future of work will be’’ (p. 1)) this would appear to be students, but the value of the work as a learning aid is surely compromised by its lack of an index. This might well exasperate those who want to take it as an intervention in current debates, too. Ransome’s position here is one of emphasising the importance of taking material factors (changes in technology and economics) seriously and examining the interplay between these and issues such as identity construction. Here I find myself in considerable sympathy with the main thesis, but a little exasperated from my own positioning within the field of management studies. I would be the first to accept that this field often is badly in need of a better acquaintance with debates in sociology, and treatments like
Ransome’s are helpful. However, I feel that he misrepresents or ignores debates happening in this field. After what I have described as a rather chatty introduction, the book shifts register and reads more like an intervention in current debates. As such, Ransome is anxious to stress the continuing relevance of the ‘‘unfashionable’’ figures of Marx, Weber and Durkheim. A helpful discussion of their ideas is used to frame a critique of notions of post-industrialism and post-Fordism. Ransome is rightly critical of some of the wilder claims made here, not only empirically but also theoretically. His main call is for a need to recognise those features which remain consistent, in particular capitalism, whilst giving due weight to the changes introduced by, for example, micro-electronics. He emphasises the flexibility of work forms which the latter allows and emphasises that the forms of implementation depend heavily on managerial choice. However, the section on managerial responses is limited to a discussion of human resource management strategies. Important as these are, I think that there is more to be said about managers, a point to which I’ll return later. Ransome is more concerned with countering other debates in the area of sociology – indeed, in defending the importance of work as an area of concern. To further this endeavour he looks at three theoretical responses, which have important things to say about the future of work. In turn these are feminism, cultural studies and globalisation. Ransome argues that feminist theories are a particularly useful resource in challenging the division between work and non-work. Here he presents a considerable amount of data about the nature of work and gender, but disappointingly does not explore other forms of work practice which tend to challenge this divide. Much is made, for example in ‘‘futurist’’ accounts of teleworking. Many of the claims are no doubt over-blown, but the rise of mobile working seems to be more significant. The blurring of boundaries that this entails does seem to be an example of the type of material changes that Ransome is concerned to hold in focus. Ransome’s argument (drawing upon the work of people such as Pollert) is that patriarchy as a concept has little explanatory (as opposed to descriptive) power. However, he finds it a more valuable response than those supplied by cultural studies. These approaches, he argues, are in danger of losing sight of work altogether in their concern with identity and consumption. This point seems to me to be well made, although I think that his treatment of Bourdieu is unhelpful. My feeling is that his work is always connected to issues of changes in the division of labour, even if the connections are a little abstract at times. Finally, Ransome presents a good deal of material to contest the strong form of globalisation. Here his main target is Castells, who he criticises for an exaggeration of the convergence of a number of trends. Whilst Ransome is appropriately critical of much in these approaches, he is also concerned to derive useful insights from them. The emphasis which some place on problematising the definitions employed is seen by Ransome as a positive point. Work is much more than that which occurs in full time, fixed
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locations in the context of permanent careers. The way in which these aspects of work is changing challenges perceptions of what ‘‘work’’ is and how identities are formed by it. Ransome is keen to hold on to the notion that work is important in shaping identities, but from these debates, he takes a key point as the emerging flexibility of work, both at a material and an ideational level. By this, he means that perceptions of roles at work and the location and nature of work itself are challenged by the flexibility which new technologies bring. Ultimately, he argues, the important consequence of this could be a renewal of debates about what work is for. He concludes: If as Marx suggested, humankind only sets itself new tasks when the means of achieving them are available, then perhaps the time has now come for us to discuss again what those tasks should be (p. 248).
Attention to these issues would seem to be important in considerations of the sociology of work and Ransome gives a good introduction to the key dimensions of the debates. However, I would want to probe a little further his understanding of the nature of management. Just what Ransome means by the literature in this area is unclear. A couple of quotes might illustrate this: Although managers always have been concerned about the subjectivities of their employees and more recently have entered the fringes of debates about the ‘‘culture of the enterprise’’, their concerns about the future of work are prioritised in terms of keeping up with technological change and of developing ‘‘best practice’’ in their organizations (p. 238). Of all the accounts we have looked at managerialist accounts sometimes seem to be entirely reactive rather than forward looking (p. 239).
One issue is of a confusion between ‘‘managers’’ and ‘‘managerialists’’. The first are almost bound to be reactive, given that they are often the first to be exposed to new possibilities. They are often guided in their responses by the ‘‘managerialists’’, who I take to be the popular writers on management who supply the vast range of works on sale in the airport lounges. However, there’s more to management studies than this. There are those writers who, whilst accepting the current arrangement of matters, are often very critical of the quick fix solutions of managers and managerialists alike. Then there’s a smaller group of ‘‘critical management’’ scholars who, often with reference to debates in the same areas that Ransome discusses, are concerned with a critical assessment of areas like culture and identity formation. Although often prey to the same sort of problems that Ransome describes with cultural studies, they have carried out work which probes in detail the way in which, for example, managers attempt to shape the cultures of their organisations. A reading of Casey’s Work Self and Society, for example, would indicate that ‘‘culture’’; is far from a fringe concern in many organisations. It would also reinforce Ransome’s contention that work remains a central site for identity construction. Other work in this tradition is concerning the fragile positioning of many managers as both managers and employees. I think there’s a good deal going on both within management and management studies that could inform debates such as those that Ransome is concerned with.
This is an interesting and stimulating read, which could have benefited from better proof reading and is crying out for an index. I have my doubts about just who it is aimed at, but those of us outside sociology could benefit a good deal from consulting it. Dr Alistair Mutch Department of Finance and Business Information Systems, The Nottingham Trent University, Nottingham
Organizational Achievement and Failure in Information Technology Management Mehdi Krosrowpour Idea Group Publishing Hershey, PA Mehdi Khosrowpour is certainly active in the information technology field. Editor of Information Management, a newsletter of the Information Resources Management Association, plus author of books on managing information technology (IT) resources in ‘‘the next millennium’’ and ‘‘the 21st century’’ (to partially quote these titles), as well as a book on Web-enabled technology, Khosrowpour offers several resources to the information technology discipline in the year 2000. Also published in this year is the title being reviewed. At the outset, please understand a reviewer bias for learning through positive examples, rather than descriptions of failure. However, since the book title includes ‘‘failure in information technology management,’’ it is appropriate to include them. Of the cases presented, six stand out as being complex, detailed, and sufficiently involving to use as discussion bases in upper level university courses. The remainder could serve as object lessons for failed applications with a common list of problems: .
personnel turnover;
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lack of money;
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shortage of experienced IT staff;
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software modules mismatched with business processes; and
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either poor implementation management or lack of support from upper level management.
Some of these failure cases offer few ‘‘lifelines’’ to learners in establishing a priority for problem solving. For example, it is hard to know where to start when the IT manager is new and inexperienced, and the people who knew anything about technology in the organization just left! On the other hand, certain cases are quite well done – rich detail (and discussion starting points), well written narratives with believable characters, interesting sites and situations, and international perspectives. A quick look at some of the more interesting cases follows:
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The National Ignition Facility case recounts planning for the world’s largest laser using 192 laser subsystems focusing on a single point to simulate conditions at the sun’s center. Researchers will be able to measure properties of nuclear reactions, while complying with the Nuclear Test Ban Treaty. The IT interest here is the integration of data repositories and systems using commercial software from an Internet software vendor. Web technology gives a unified interface to procurement officers, in-house engineers, and external partners. It provides access to process-oriented procurement applications and project-oriented engineering tools and knowledge management. The US automotive network exchange case focuses on increasing connectivity between carmakers, dealers, and suppliers using a community of interest network (COIN). Component suppliers and manufacturers select a service provider, and an industry interest group administers the system. This industry has changed over time due to globalization, increased competition, and over-capacity. Manufacturers are outsourcing parts supplies and using electronic data interchange (EDI) to communicate. Suppliers are now engineering and manufacturing sub-assemblies, delivering them just in time, sequenced for assembly. They compete in price and quality, supplying several manufacturers on a global basis. The IT interest here is electronic data interchange. This case features plenty of data and concepts for discussion. The Jeans Wear executive information system case describes the strategic advantage of establishing a data warehouse to enhance apparel replenishment activities. Adjusting inventory and styles to respond to consumer tastes encourages individual sales, rather than a mass response to marketing – a pull strategy. EDI at the point of sale reduces restocking times as well. A data warehouse provides the data foundation from which retailers can make effective, timely decisions. It is also enterprise wide, crossing department and business units. Focal points in this case are the knowledge and experience in business processes on the part of managers, who led the project when it called for their particular expertise, and the interaction between end users and the IT staff. It also brings out the workload involved in maintaining the database. The Celerity Enterprises case details information planning in a volatile manufacturing industry and the need to align information strategy with overall business strategy. Celerity is a semiconductor manufacturer with headquarters in the USA and assembly sites worldwide. Manufacturing/ assembly positions comprise 80 per cent of the workforce. The case concerns updating a technologically old factory to produce programmable nonvolatile memory for consumer products in telecommunications, automotive, and railway equipment. The
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organizational culture change required to transform innovation orientation to that of low-cost production adds an interesting twist to this case. By sticking to proven technologies and learning from existing productivity improvement measures in other locations, the management team hopes ‘‘to demonstrate how information can replace constrained, consumable resources’’ (p. 198). A knowledge management slogan if there ever was one! The big-bang enterprise resource planning (ERP) case addresses a Y2K problem in a potash extraction plant on the Dead Sea. As a result of increasing size, global expansion, and cultural concerns, Dead Sea Works decided to buy rather than make an ERP system, also choosing to outsource implementation rather than using internal resources. This case speaks to the consideration of software to integrate production, inventory, procurement, accounting, sales, marketing, and personnel functions in a database management system via state-of-the-art clientserver architecture. Positive results were attributed to the possible alignment of Dead Sea Works’ needs and the support provided by the IT system implemented. Detail in the case is full and rich. The municipal social services agency case concerns adapting general purpose accounting software to the information-processing needs of a foster care program. A short, straightforward case, it shows a simplified approach to improving data access and transaction processing using offthe-shelf software. The vendor modified the software and provided implementation. Everyone is pleased with productivity increases and solid customer service provision to this important societal concern.
The remaining cases largely fall in two categories: (1) technology issues are present but no information planning has been done; and (2) business plans and information plans are mismatched. As can be expected, the human responses to organizational problems vary, with the common theme being missing leadership – attributable to lack of interest or knowledge concerning the issues. The format for the cases is standardized, in that readers can expect these features: . executive summary; . background; . setting the stage; . case description; . current challenges/problems facing the organization; . the decision/conclusion;
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further reading; and references.
This makes reading easier, especially in the longer cases, since the thought thread continues throughout each case. Readers don’t get lost in the details. Questions for discussion would make a nice addition, as well as content indicators for each case, perhaps gathered into a chart so that readers could quickly go to cases that addressed problems of particular interest to them. The charts and graphs are difficult to read due to the size of the inserts and the print fonts. An annoying aspect was the overuse of acronyms. Commonly known ones, such as HR for human resource, are understandable, but in a developing area of knowledge with several disciplines contributing information, clear terminology is more useful, especially to novice readers. A nice feature is the inclusion of Web addresses for some companies and subjects. The Y2K issue comes up in several cases, which leaves a flat feeling in the reader, since the issue no longer concerns the public. Some of the cases seem dated, since they were written in 1998. Many technological advances have been made since that time. However, a discussion leader could conceivably add updated information. For example, the National Ignition Facility is currently in the news as a result of a General Accounting Office report citing a doubled cost projection over the original estimates of five years ago. As a final comment in this review, the strength of this book is the case development, which answers an important pedagogical need for examples to use in instruction. Especially in disciplines that make advances almost on a daily basis, educators in all settings need an essence or a core from which to develop instruction. Case studies add to this core by providing business-based decision-making quandaries that arouse learners’ interests and engage their problem-solving capabilities. The international settings in this book become added value for learners. Taggart Smith School of Technology, Purdue University, West Lafayette, IN, USA
About the authors Carol Agocs Carol Agocs is Professor in the Department of Political Science at the University of Western Ontario, London, Ontario, Canada. She is Editor of Workplace Equality: International Perspectives on Legislation, Policy and Practice (Dordrecht: Kluwer Academic Publishers, in press). E-mail:
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About the authors
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H. Battu H. Battu is a lecturer in the Department of Economics, University of Aberdeen. His main research interests are in labour and regional economics. E-mail:
[email protected] Gerard Griffin Gerard Griffin is director of the National Key Centre in Industrial Relations at Monash University. Gerry’s major areas of research are industrial relations at the workplace level, enterprise bargaining, pay classifications and the structure and membership of trade unions. He is the author of three books and more than 40 refereed journal articles and chapters in books of readings. Gerry has worked in both the public and private sectors. He has held visiting appointments at universities in Britain, Ireland, New Zealand and the USA. E-mail:
[email protected] Harish C. Jain Harish C. Jain is a Professor of Human Resources and Labour Relations in the Michael G. DeGroote School of Business at McMaster University in Canada. He has published extensively in the areas of employment equity in Canada and several other countries; multinationals and human resource management; police and racial minorities; and industrial relations. He has been a Consultant to the national government in South Africa, to the Organization for Economic Cooperation and Development (OECD) in France, federal and provincial government agencies and human rights Commissions across Canada. E-mail:
[email protected] C.S. Venkata Ratnam C.S. Venkata Ratnam is a Professor at the International Management Institute in New Delhi, India. He was the former Dean of the School. Professor Ratnam has published in the area of industrial relations in India and is a Consultant to the International Labour Organization in Geneva, Switzerland. He has published numerous scholarly articles in Indian and international journals on industrial relations, and affirmative action/employment equity areas. E-mail:
[email protected]
International Journal of Manpower, Vol. 23 No. 3, 2002, pp. 305-306. # MCB UP Limited, 0143-7720
International Journal of Manpower 23,3
Chandra Shah Chandra Shah is Senior Research Fellow in the Monash University Centre for the Economics of Education and Training. His interests include forecasting, labour market research and completion rates in vocational and higher education.
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– ACER research student E-mail:
306 P.J. Sloane P.J. Sloane is Jaffrey Professor of Political Economy, University of Aberdeen, Dean of the Faculty of Social Sciences and Law and Vice Principal. He is a research fellow of the Institute of Labour Studies (IZA) Bonn and a fellow of the Royal Society of Edinburgh. His research interests cover various aspects of labour economics and the economies of sport. E-mail:
[email protected] Julian Teicher Julian Teicher is Head of the Department of Management at Monash University. As well as holding a variety of university positions, Julian has worked as an industrial relations practitioner and consultant gaining experience in the health, maritime, and power industries. His research and publications have spanned topics including employee participation, enterprise bargaining, industrial relations legislation, occupational health and safety, equal opportunity and diversity management, skill formation, privatisation, outsourcing and public sector management. E-mail:
[email protected] Ade`le Thomas Ade`le Thomas is an Associate Professor and Area Head in the Human Resources department at the Graduate School of Business Administration, University of the Witwatersrand, Johannesburg, South Africa. She holds BA (Social Work) cum laude, MA cum laude, MBA and D. Litt et Phil degrees. She has been involved in researching practices of affirmative action and managing diversity among top companies in South Africa. She is currently researching major challenges to business in South Africa and strategies that should be considered in order to become internationally competitive, including corporate governance, leadership and business ethics. E-mail:
[email protected]
International Journal of Manpower, Vol. 23 No. 3, 2002, p. 305. # MCB UP Limited, 0143-7720
