From:  http://lawofwork.ca   Tuesday, August 20, 2013

    By   Dr. David Doorey

My colleague here at the School of HRM at York, Tony Fang, found a while back that the union wage premium in Canada is about 7.7% (see page 13), meaning that unionized workers earn that much more on average than nonunion workers. Unionized workers also receive significantly better benefits and pension plans.  Since polls suggest people are very concerned about growing income inequality, it might seem logical that they would also support policies and practices that put more money into the hands of working folks.

Thus, if you are a nonunion worker earning less than what a unionized worker earns, a rational response would be to say, “Why am I doing the same work for less pay, less job security, and fewer benefits?  I should join a union too.”  Some people do think that way.  But many people do not, and respond to the better paid unionized workers with hostility. They say, “those damned greedy unionized workers, we should get rid of unions, and strip those workers of their better pay and benefits“.

It’s perfectly understandable why employers and conservative politicians and think tanks argue against collective bargaining and better wages and benefits enjoyed by unionized workers.  Their interest is in maximizing corporate profits, executive compensation, and shareholder dividends by giving less of the pie to workers, and in the case of the Conservative Party, in weakening an effective political foe in the labour movement.

Much more interesting is why the average worker would side with an argument for lowering wages and benefits.

I was thinking about this after I was interviewed on a radio station recently, and the host said that “people” are angry at the wages of union workers, and she asked me what I had to say to those people.  I said that maybe they should join a union.  The host gagged.  Apparently that wasn’t the answer she was looking for.  What do you think was the “correct” answer to that question?

Why Do Working People Support Policies Designed to Lower the Pay, Benefits of Working People?

This piece in the New Yorker describes  how nonunionized workers in the US experience ‘resentment’ over better wages and benefits enjoyed by unionized workers. In past times, workers responded by seeking out good unionized jobs themselves. However, in more recent times,  America workers are responding to this resentment  by supporting initiatives designed to strip labour rights.

Robert Frank

I read an interesting book by Robert Frank, called Falling Behind: How Rising Inequality Harms the Middle Class. He provides an interesting insight into this question by using a model that is something like this.  He imagines two worlds that are identical (ie.  prices of goods are the same in both worlds), except for one thing:

World A: You earn $100,000, but everyone else earns $120,000.

World B:  You earn $80,000, but everyone else earns $60,000.

In World A, you can buy a bigger house and nicer stuff than in World B, but everyone else can buy even nicer stuff and more stuff than you.  In World B, you can afford less of everything, but that would still be more than everyone else could buy.  In other words, you are relatively better off in World B compared to everyone else, but you are absolutely better off in World A.

Which world would you prefer to live in?

Frank says that most people select World B.  They are concerned more about how they fare relative to others than the absolute level of their income.  That might help explain why many nonunion workers get angry when they learn that unionized workers earn more than them, and why their first response might not be  to try and bring their wage levels up to the unionized rate by joining a union themselves.

They want other people’s wages to come down more than they want their wages to go up.  They are more concerned with doing relatively better off than the next guy than they are in raising their own absolute income level.   Frank’s insights might also help explain why the vast majority of unionized workers are happy with being in the union:  Lipset and Meltz found that 90.5% of American and 85.8% of Canadian union members would vote to remain in the union if asked.  Theses statistics refute claims by antiunion folks like Tim Hudak and Conservative politicians, who like to argue that there are large numbers of trapped union members who just can’t escape from their union oppressors.

Professor Harry Arthurs, Canada’s eminent labour law scholar, has offered this insightful explanation for the apparent paradox of low wage workers supporting politicians who want to gut labour and employment laws and undermine collective bargaining:

Harry Arthurs

the rise of non-standard employment has not only cost millions of workers their rights, benefits, and sense of ‘identity and self-worth’. By widening the gulf and shifting the numerical balance between workers still protected by labour law and those who are not, it may also have contributed to a new political dynamic in which have-not workers acquiesce in or support efforts to strip the haves of their advantages. (Labour Law After Labour)

Harry’s making the same basic point as Frank.  Employer preferences for fewer standard, full-time workers and government policies designed to weaken employment laws and access to collective bargaining are growing Canada’s income inequality and creating huge pools of marginalized workers (as explained by Professor Michael Lynk in this paper).  Yet many of these workers are responding by supporting policies they think will bring the relatively better off workers down to their level, rather than policies that would attempt to bring them up to improved levels.

Issue for Discussion

Do you think Frank’s story about people being driven mostly by a desire to do relatively better than others explains why low wage workers would support policies designed to strip other workers of benefits?

What do you think of Professor Arthurs’ claim that the growth in precarious work has caused precarious workers to support policies that strip more privileged workers of their rights and benefits?

Dr. David Doorey is an Associate Professor of Labour and Employment law at York University’s School of Human Resource Management, where he teaches courses in labour and employment law and industrial relations to undergraduate business and HRM students, and graduate students in law and HRM.  For the 2012-13 academic year, Professor Doorey is Visiting Scholar at the University of Toronto, Faculty of Law and the Centre for Industrial Relations and Human Resources.

Professor Doorey is Academic Director of Osgoode Hall Law School’s executive LLM Program in Labour and Employment Law, and sits on the Advisory Board of the new Osgoode Certificate program in Labour Law.