Wednesday, December 15, 2010

Policy: Look Out Below

The government announced the results of a workplace safety inspection blitz in the commercial construction industry conducted this fall. Not unexpectedly, the results indicated widespread non-compliance with the OHS Code.

Of the 298 inspections (encompassing 146 companies and 73 work sites), inspectors found 214 violations. Thirty-nine stop work orders (27% of worksites) were issued for particularly dangerous situations. There were also 12 stop-use orders issued related to non-compliant scaffolding.

The inspections found major problems with fall protection. Among the violations noted were failure to provide protective gear, failure to provide a fall protection plan, lack of proper safeguards and scaffolding violations. All of these are employer responsibilities.

Minister Thomas Lukaszuk noted: “If there is no response, if we don’t see improvement on the work sites, then we will be implementing new and more creative and more aggressive measures by which we will curtail those numbers.”

This inspection blitz raises several interesting questions. First, why is this the first-ever safety inspection blitz in Alberta's history? Workers are killed or injured in droves each year. The only difference this year is that the government took political heat about it in the press. Should we conclude that worker injury and death only matter to the government when there is bad press?

Second, why would the minister wait to take more aggressive inspection and enforcement action? The academic literature is pretty clear: absent surveillance and enforcement, safety rules are routinely ignored. This inspection blitz provides more evidence that education and voluntary compliance are ineffective at protecting workers.

Third, why is the government threatening to ticket workers (as well as employers) for safety violations? The evidence here is that it is employers who can't seem to organize work in a safe manner.

Workers didn't fail to provide fall protection equipment or fall protection plans. Workers didn't fail to provide safe guards or provide scaffolding that was unsafe. In fact, workers would probably prefer to have safe worksites.

These are employer responsibiilities--ones that employers routinely evade because safety precautions slow down work and increase costs. It is cheaper to not provide these protections and hope no one gets hurt--because there are basically no consequences for the employer if they do.

-- Bob Barnetson

Monday, December 13, 2010

Research: Mesothelioma Reporting Rates

Three new studies raise some interesting questions about statistics regarding asbestos-related disease rates and compensation. The article “Surveillance of mesothelioma and workers’ compensation in British Columbia, Canada” broadly mirrors the results of studies in Alberta and Ontario.

The study examined reporting and compensation of mesothelioma in BC. Mesothelioma is an almost always fatal cancer that is clearly linked to asbestos exposure.

The study found that, between 1970 and 2005, 33% of BC cases of mesothelioma were compensated by the workers’ compensation board. Annually, the rate of compensation increased over time and was as high as 49% in 1999 and 2004. These rates of compensation are approximately half the rates in France (62%) and Australia (64%) notably lower than rates in Ontario (43%) and Alberta (42%). Gender, age, site of cancer and location of residence all were important variables in acceptance rates.

Under-compensation is important because accepted compensation claims are used to “count” workplace injuries and illnesses. Unaccepted cases of occupationally-related mesothelioma (normally caused by non-reporting) results in an under-estimation of exposure rates and of the hazardous nature of asbestos. This, in turn, results in greater externalizing of production costs onto workers, their families and the general medical system in the form of mesothelioma and other asbestos-related diseases.

Monday, December 6, 2010

Asbestos: Occupational or Environmental Hazard?

This weekend the newspaper featured an interesting story about asbestos. Following an apartment fire, residents have been evacuated while the damage is being fixed. This includes remediation of asbestos (which is common in older buildings)--a mineral fiber likely used to insulate or possible strengthen the structure of the building (hard to know at this point).

The story focuses on the plight of tenants who must find alternate accommodation for four months and how the insurance company covering the fire will not cover these costs. There is also some minor discussion of how various regulatory schemes seem to interact around the asbestos removal.

Asbestos and its dangers are the subject of many books, the most recent being Defending the indefensible by Jock McCulloch and Geoffrey Tweedale. The key health effects of asbestos exposure include asbestosis, lung cancer and mesothelioma (cancer of the chest and stomach wall lining). There may also be other asbestos-related illnesses (I recall reading something about colorectal cancer and asbestos but cannot find the source offhand).

There is no safe level of exposure to asbestos, despite governments enacting (ever lowering) occupational exposure limits for it. An interesting question this story raises is whether there is any real difference between an occupational hazard and an environmental hazard. The answer, according to McCulloch and Tweedale, is not really.

While occupational exposures to hazards such as asbestos tend to be in higher concentrations (thus the resulting diseases manifest themselves more frequently and more quickly), the mineral poses risks to everyone, particularly given its prevalence in the environment. This relationship is not confined to asbestos but seems to be broadly applicable across hazards.

The China Price details how coal mining and power generation in China, for example, entails both occupational and environmental effects as air and water are polluted. And, of course, the introduction of lead to gasoline first manifested itself as a hazard among workers and is now recognized as a source of lead contamination in the air, water and soil which is particularly dangerous to children.

Returning to asbestos, there is widespread disease in South Africa and Australia among miner’s families exposed to asbestos in the community. Workers have been treated as largely disposable by asbestos mining corporations who knew as early as 1918 about the risks but hide them for another 50-odd years and continue to evade compensating workers for their losses.

Canada is not immune to asbestos, with fibres brought home in workers’ clothes causing asbestos-related diseases among their families. But have a look around your own home if it pre-dates the 1970s—you’ll likely find asbestos in floor tiles as well as insulating pipes and ducts (this will look like fabric adhered to ductwork). Asbestos has also made its way (over time) into the food chain, paints, dishtowels, bank notes, tampons, insulation, piano felts, and cigarette filters (ironically asbestos and cigarette smoke interaction to increase the risk of lung cancer by 90 times over smoking alone).

The potential death toll from asbestos-related diseases is massive: 10,000 deaths per year in the US alone (as many as 100,000 annual across the globe). This takes no account of the declining quality of life of those afflicted with asbestos. And interesting local angle is this audio clip of a daughter discussing her father’s death by asbestosis in Alberta.

-- Bob Barnetson

Friday, December 3, 2010

Policy: Farm Safety Gridlock

This morning, two farm workers were electrocuted, apparently because a grain auger they were moving struck an overhead power line. Occupational health and safety won’t be investigating because farm workers are excluded from the ambit of the Occupational Health and Safety Act.

And the Workers’ Compensation Act.

And much of the Employment Standards Code.

And the Labour Relations Code.

After years of lobbying and judicial commentary that such exclusions are unconstitutional and/or without any good reason, the Alberta government has announced changes. Well, sort of.

In lieu of setting safety standards and enforcing them, industry and government reps will get together to figure out how to enhance farm safety training and education.

This all sounds nice. But it ignores that unsafe work is one manifestation of the broader conflicting interests of workers and employers. Unsafe work is usually faster and cheaper for employers than safe work—because unsafe work externalizes some costs of production onto employees in the form of workplace injuries.

This is, indeed, the reason why we have occupational health and safety laws in the first place. Education alone simply does not work because it (rather unrealistically) expects employers to act contrary to their own economic interests.

That employers have little appetite for regulation comes through quite clearly in the comments in the government’s recent consultation (mostly with employers).

“(Employers) warned the government to be careful not to create bigger problems in attempt to enhance health and safety.”

“Many (employers) commented that education is a better way to reduce farm accidents rather than regulations. A couple thought that voluntary education would be met with much less resistance and more acceptance.”

Such comments are hardly surprising and neither is the government’s focus on education rather than regulation. Education is relatively cheap. Education has limited impact upon farmers--who have traditionally supported the conservative government and who have, in turn, been rewarded through the gerrymandering of electoral boundaries and exclusion from the regulatory regime. And education sets up a “blame the worker” situation when “educated workers” get injured (conveniently ignoring it is the employer who determines what will be done, when, where and how).

What this suggests is that short of a court challenge about the exclusion of agricultural workers from virtually all of the basic workplace rights that every other worker has or a change in government, there is no prospect for meaningfully improving farm worker safety in Alberta.

-- Bob Barnetson

Thursday, December 2, 2010

Research: Protracted WCB claims

Injured workers who have unusually protracted compensation claims are the subject of curiosity—in part because such claims can entail significant costs to the compensation system which are ultimately passed onto employers. Such inquiries are often couched in terms of “what is wrong with these workers?” The Journal of Occupational Rehabilitation has published an article examining this issue from a different perspective.

The ‘‘toxic dose’’ of system problems: Why some injured workers don’t return to work as expected” considers the effect of seeming innocuous bureaucratic problems on workers and a potential explanation. The authors posit workers’ experience of these systemic dysfunctions damages them in difficult to see ways which impede recovery and return to work. The study focuses on Ontario but has broad application as most workers’ compensation systems provide employers with incentives to provide modified work to injured workers in order to reduce time away from work.

The study found that return to work (RTW) systems and policies are premised upon inaccurate assumptions about how RTW actually operate. For example, the parties may not be communicating well and there may be conflicting motives among stakeholders for participation in RTW. These issues manifest themselves in seemingly mundane ways: “inappropriate modified work, injuries that are not reported, co-worker hostility, untimely and inappropriate referrals for retraining, physicians who are too busy for paperwork, workers’ compensation decision-makers who communicate inadequately with workers by mail and telephone” (p. 360). The seeming insignificance of these difficulties makes it difficult to “see” them as issues that can compromise the effectiveness of RTW programs.

Yet these systemic defects have important mental and physical consequences for injured workers. For example, “inadequately informed benefit entitlement decisions can result in denial of income and other support benefits to workers, who, can then, suffer financial and mental strain and deteriorating health conditions” (p. 360). This dynamic effectively overwhelms workers who already face injury-related difficulties. Herein lies the “toxic dose” administered by the system to injured workers and perhaps an important piece of explaining why some compensation claims generate seemingly unwarranted costs and delays.

Monday, November 22, 2010

Research: Crisis of Capitalism

David Harvey has provided an interesting explanation of the nature of the current economic crisis. While perhaps not directly related to labour and employment in Alberta, this explanation of the crisis examines some of the structural causes of the pressure that now directly affects employment and does so in a very engaging manner.

Research: Motivating Employees

Employee motivation is often an area of interest for HR and LR practitioners. While an interesting debate can be had about the political economy of employee motivation, most practitioners are more interested in practical advice.

Most HR texts do a poor job of handling motivation. One of our learning designers passed this video of Dan Pink discussing employee motivation. It summarizes the literature of motivation set out in his book Drive. It is also exceptionally entertaining to watch.

Another good book on motivation is Driven (by Paul Lawrence and Nitin Nohria) examines motivation from the perspective of evolutionary psychology.

-- Bob Barnetson

Monday, November 15, 2010

Research: Effective corporate self-regulation

An upcoming article in Administrative Science Quarterly sheds new light on organizational self-regulation—a strategy often advocated as a replacement for direct government regulation of the workplace.

Making self-regulation more than merely symbolic: The critical role of the legal environment” concludes that organizations were more likely to effectively self-regulate when their industry was subject to heavy regulatory surveillance and when self-regulation was voluntarily adopted. By contrast, poor performers were much less likely to effectively self-regulate, suggesting that self-regulation may not be an appropriate strategy to improve compliance among such companies.

This paper provides further empirical support for the long-standing criticism of self-regulation: internal regulatory structures tend to be improperly influenced by managerial priorities within the organization. Crassly, when the inmates are in charge of the asylum, rehabilitation tends to give way to baser impulses. Where this article provides new insight is into specific circumstances when self-regulation works better and poorer.

The specific results were really quite interesting. Organizations disclosing violations that were not facing regulatory threats and which committed to self-regulation exhibited improved outcomes in the future. By contrast, facilities disclosing violations while facing regulatory threats did not improve their outcomes. This supports the notion that heavy-handed government intervention can undermine organization’s motivation to effectively self-regulate. At the same time, high levels of state surveillance appear to make an important contribution to promote the effective self-regulation, even when not accompanied by punishment.

The researchers also found that organizations with poor histories of compliance tended not to show the same improvements as companies with better compliance histories when asked to self-regulate. In this, we may be seeing organizations using self-regulation as a smoke screen to hide from enforcement behaviour.

This research has direct application to Alberta. Here, the government runs a Partners in Injury Reduction program wherein employers are encouraged to self-regulate and receive various workers’ compensation premium rebates based on obtaining a Certification of Recognition (COR) and their injury claims records.

The April 2010 Auditor General’s report called into the question this program as some employers with CORs “do not comply with OHS orders and their workers are much more likely to get injured on the job, yet these employers continue to receive Partners in Injury Reduction financial rebates and use their COR to bid on contracts with major companies in such industries as construction, and oil and gas” (p.42).

It will be interesting to see how the government grapples with the complexities of self-regulation as it continues to cope with the public attention to Alberta's workplace injury problem.

-- Bob Barnetson

Monday, November 8, 2010

The political economy of health and safety

Late last week, the government provided some additional information about its renewed emphasis on workplace health and safety. In an interview, Minister Thomas Lukaszuk noted that the government is pursuing companies which have outstanding OHS fines--fines levied for injuring or killing workers.

Lukaszuk is spinning these efforts as a good news story. Yet some questions are in order. The most obvious is why are these fines--which total at least $1.7 million--unpaid in the first place? If you get a $100 traffic ticket, the province will pursue you to the ends of the earth and eventually revoke your right to drive by not renewing your license.

Yet millions owed by companies whose workers were maimed or killed continue to operate with impunity. It is only because of a confluence of events--a bad auditor general report and a Calgary Herald investigation of workplace fatalities--that the government is seeking payment.

This says some important things about the political economy of employment that are often obscured by the day-to-day hustle and bustle. On the one hand, governments must facilitate the capital accumulation process. That is to say, they must act in ways that allow employers to produce goods and services in a profitable manner and thereby encourage private investment. Failing to do so may result in an economic downturn, for which the government may well be held responsible. This may have significant social consequences for society and electoral consequences for the government.

On the other hand, governments must maintain their own legitimacy with the electorate as well as the legitimacy of the capitalist social formation. The operation of capitalist systems often negatively affects workers, who comprise the majority of the electorate. We see this in the form of low pay, poor working conditions, and the specter of workplace injury and death. These effects can cause a loss of confidence in a particular government or in the capitalist social formation.

So long as concerns about workplace injury can be contained--by ignoring them or explaining injuries away (e.g., as the fault of careless workers)--the state can safely ignore occupational health and safety. It is only when there is a legitimation crisis--when the state's credibility is imperiled by its lack of action for the public good--does the government bother to enforce its own laws.

It will be interesting to see whether the government's renewed interest in workplace health and safety continues once the furor of this summer dies down. It will also be interesting to see if the government truly has the stomach to meaningfully address the issue of occupational disease--an issue that quickly bumps up against environmental disease and whose remedy may impose significant costs upon employers.

-- Bob Barnetson

Thursday, October 28, 2010

Research: Corporate social responsibility

The journal Academy of Management Perspectives published an interesting article in 2009 entitled "Is the socially responsible corporation a myth? The good, the bad and the ugly of corporate social responsibility." In it, the author examines whether the conflicted nature of corporations perhaps makes spurious the notion that corporations be an instrument of public policy.

Corporate Social Responsibility (CSR) is a bit of an ill-defined concept. A workable definition might well be something like a management strategy whereby organizations take responsibility for their impact on society and the environment. From a labour perspective, this might include focusing on eliminating health risks from production to workers and from products to customers.

The real question is whether CSR is more than just window dressing. In a fairly even-handed manner, the article's author concludes there is little empirical evidence or logical reason that corporate behaviour will be socially enhancing. Further, he notes that social responsibility is a contested concept (one open for colonization by corporations) and that corporations must make difficult trade offs when they act in socially responsible ways.

These limitations reflect the corporations exist to optimize for themselves, rather than for the general public. An interesting line of analysis is corporations use of CSR as a competitive weapon to monopolize a sector. In short, agreeing to CSR environmental or employment standards of practice may make entry to new firms (or the existence of smaller firms) financially untenable.

Two books provide some useful insight into this issue. Harry Glasbeek's 2002 book Wealth by stealth provides an analysis of the corporate form and its implications for society. Glasbeek takes particular pains to outline the anti-social and criminal behaviour endemic in the corporate form.

David Michael's 2008 Doubt is their product is a damning account of how corporations have hidden the health effects of products and production from consumers and workers. It does a particularly good job of examining the decades-long manipulation of occupational health research in order to delay and derail regulation of hazard substances. I like to think of myself a suitable jaded, but Michael's book was, frankly, shocking to read.

While I don't want to be reflexively dismissive of CSR, the evidence that corporations act in socially irresponsible ways in order to achieve their goals is difficult to dismiss. And it sheds light on contemporary topics such as the recent dust-up between Bee-Clean Cleaners and their largely immigrant workers.

-- Bob Barnetson

Monday, October 18, 2010

Are safety records accurate?

The government of Alberta recently launched a new database of employer injury records. Minister Thomas Lukaszuk noted:

“Albertans have the right to know the injury record of who they are working for. We hope that making this information public will encourage employers to commit to even better health and safety performance.”

So does this database allow workers to see the injury records of their employers? My colleague, Jason Foster, does not think so:

"As one example, I requested all employer reports in Residential Construction, one of the more dangerous industries. 503 employers came up. We know that four fatalities and 325 injury claims were reported from this industry in 2009. However, not a single employer in the report was recorded as having a fatality or even an injury. Where are the deadly phantom employers? Why do their records not show up?"

The Alberta Federation of Labour has done a similar analysis:

" We found:

- Clayton Construction Limited is facing seven charges, laid September 2, 2010, for an alleged offence involving a fatality on September 2, 2008. A search on the new site came up with "no results found."

-Canadian Natural Resources faces two charges from the same fatal event. The same company has also been charged in relation to three other fatalities and three injuries - or six of the 31 active charges (20 per cent) listed by Employment and Immigration. A search of the new site brings up three records for the company, two of which have references to Lost Time Claims (LTCs) in 2008, and LTC rates marginally above the rates for the industry, but no reference is made to the fatality or charges.

-Central Alberta Well Services Corp. faces five charges for an alleged offence on August 26, 2008. A search on the new website results in a dizzying array of eight records for the company, under varying Industry Name segments, each giving different Lost Time Claim statistics."

These analyses raise very difficult questions about the quality of the data the government is using. They also raise serious questions about whether the database fulfills its official purpose: allowing workers to determine their employer's injury record. It will be interesting to see if the three workers killed in as many days this weekend, show up in the statistics for next year.

-- Bob Barnetson

Tuesday, October 12, 2010

Safety records and ticketing

It has been an interesting summer for occupational health and safety in Alberta. A Calgary Herald series highlighted ineffective workplace fatality prosecutions. And the provincial auditor general also issued a critical report. This was followed by turnover among senior OHS bureaucrats.

One of the government's responses was to resurrect the publication of employer injury records. Despite criticisms that the information released was misleading and incomplete, the government went ahead and put this information online.

In the wake of this, some old adversaries have popped up to spar. Former Minister of Employment and Immigration Clint Dunford praised the release of lost-time claim data on most Alberta employers. And former director of policy for the Alberta Federation of Labour Jason Foster (who is now my colleague) responded, with a fairly damning list of deficiencies in the new system.

Unable to get ahead of the safety debate, the government is now hauling out a second idea from 10 years ago: ticketing of OHS violations. This is a very interesting debate because of how ticketing can shape the perception of who is responsible for workplace safety.

A recent study in the British Journal of Criminology entitled "The Regulation of Corporate Violations: Punishment, Compliance, and the Blurring of Responsibility" examines ticketing in Ontario. Its conclusion is that:

"This regulatory shift has resulted in a diffusion of responsibility for safety risks as workers have increasingly become individually responsible for enforcing regulation as well as a target of regulation. In essence, workers are being transformed from a victim to a health and safety offender."

In effect, ticketing can serve to blame the victim. On the other hand, if employers are the focus of ticketing, then ticketing stands a good chance of altering their behaviour. This is particularly true of small employers for whom a fine would be a significant penalty. It also creates a penalty for violations that do not result in injuries. Presently, injury-violations are the only ones that trigger any penalty, and even these do so infrequently.

-- Bob Barnetson

Friday, October 1, 2010

Janitors fight back at U of A

An interesting story is developing out of the University of Alberta. A group of janitors employed by Bee Clean Building Maintenance (which is under contract with the university) has taken a number of steps to protest what it believes is unfair treatment:

1. The employees, with the assistance of the Service Employees International Union, has filed civil suit against Bee Clean for over $42,000 in unpaid wages.

2. The SEIU has filed an unfair labour practices complaint with the Alberta Labour Relations Board alleging Bee Clean has violated the provisions of the Labour Relations Code precluding employer interference with the formation and administration of a trade union.

Some of these workers are temporary foreign workers. They allege that the employer has threatened to send them home if they persist in forming a union. They also assert a worker was terminated for supporting coworkers who are temporary foreign workers. Bee Clean has not yet responded publicly.

The janitors are backed by a fairly saavy campaign more typical of the Justice of Janitors campaign in the US. The Los Angeles Justice of Janitors campaign was the basis of the 2000 film Bread and Roses.

Temporary foreign workers (TFWs) routinely face violations of basic employment right. In 2009, 74% of employers employing TFWs inspected by the province were found to be in violation of the Employment Standards Code. Half of these violations were for not paying workers properly. In a bizarre bit of spin, Employment and immigration Minister called these stats good news:

"They know what their rights are, they know what their privileges are as Alberta employees and they're making complaints that are valid."

So why then have the janitors chosen civil action over seeking payment for unpaid wages through the Employment Standards Code process? A part of the issue may be the limited reach of employment standards. Section 90 only allows employment standards complaints to go back six months from the date the order for back pay was issued on.

Practically what the means is that an employee files a complaint. It takes awhile for the complaint to be investigated and an order issued. A cagey employer will correct the illegal behavior when the complaint is filed and then stall the investigation. This stalls the issuance of an order (which crystallizes the six-month retrospective period) and thereby reduces the owed backpay by dragging out the proceedings.

The 2005 review of the Employment Standards Code identified this as an issue to be fixed by crystallizing the six-month period on the date of complaint. Despite spending hundreds of thousands of dollars in staff time and on consultants (including yours truly) the government shelved the recommendations from the review and this issue never got addressed.

-- Bob Barnetson

Monday, September 27, 2010

Research: The reflexive worker?

An interesting article appeared in Work, Employment and Society today. "The myth of the reflexive worker: class and work histories in neo-liberal times" examines the life-stories of 55 workers in Britain to assess the degree to which class continues to affect life choices. The idea that class remains an important determinant in life patterns runs contrary to the notion that "reflexive workers" navigate the increased insecurity that characterizes labour markets.

The article demonstrates the "work trajectories, despite changes that have taken place, are still driven along class tracks by class motors." Those workers with access to capital appear better able to explore new directions and cope with employment setbacks. Those without such access find themselves much less able to cope and thus make choices of necessity. Herein we see class remains an important driver of behaviour.

Class, of course, can have an international dimension as the growing use of temporary foreign workers (TFWs) in Alberta demonstrates. Traditionally limited to domestic workers, the use of TFWs has rapidly expanded. On October 19, the Work and Learning Network in partnership with the Prairie Metropolis Centre will be hosting a Temporary Foreign Workers (TFW) symposium in Edmonton addressing TFWs in nursing.

-- Bob Barnetson

Thursday, September 23, 2010

Research: Safety Inspections and Injury Reduction

A new study in the Journal of Safety Research examines the impact of workplace inspections on injury rates. Confirming earlier research, this study finds that inspections that result in penalties affect injury rates, both those related to the inspections and those not related.

"What kind of injuries for OSHA inspections prevent?" estimates of the impact of Occupational Safety and Health Administration (OSHA) penalty inspections in Pennsylvannia manufacturing firms with 20 to 250 employees between 1998 and 2005 on injury rates. More simply, if the government penalizes a firm for a safety violation, how does it affect the firm's subsequent injury rate?

The results indicate that inspections with penalties result in significant reductions in injury rates. The study found 4.1% annual reduction in the pooled injury rate of those injury causes that are more closely related to OSHA standards. Interestingly, there also appears to be a spill over effect with a 7.2% annual reduction in the pooled injury rate of those injury causes that are less closely related to OSHA standards. This suggests that firms respond to penalties by pulling up their safety socks in many areas as well as addressing the specific deficiencies noted by the inspection.

The conclusion that inspections with penalties make workplace safer is consistent with the broader literature. For example, Tompa et al.'s 2007 meta analysis examined how experience rating, inspections and inspections with penalties affect injury rates. Their conclusion are compelling:

"There was moderate evidence that the degree of experience rating reduces injuries, limited to mixed evidence that inspections offer general and specific deterrence and that citations and penalties aid general deterrence, and strong evidence that actual citations and penalties reduce injuries."

This raises the question of why Alberta continues to focus so much effort on experience rating and incentive schemes and relatively little effort penalizing safety violators? While rewarding employers that report few injuries and not penalizing employers with injuries and fatalities is likely politically popular with employers, its seems an unlikely way to protect workers--which is the point of occupational health and safety systems.

-- Bob Barnetson

Thursday, September 16, 2010

Minimum Wage to Rise

After the government suspended a scheduled increase in the minimum wage and requested the Standing Committee on the Economy to hold hearings this summer, the committee has recommended raising the minimum wage by 25 cents an hour and enshrining some form of indexing in legislation.

While this outcome is good for minimum wage earners, it is a bit hard to fathom what the point of this all was. Minister Lukaszuk's rationale that the scheduled raise imperiled jobs was never credible and clearly the Standing Committee on the Economy decided not to sign on to it.

I wonder if the submissions to the committee tell us something important about how public policy in Alberta is made. Seventy-five percent of the 220 submissions received by the committee were from members of the Canadian Restaurant and Foodservices Association. The CRFA has previously complained about increases in the minimum wage. Its own website documents a concerted campaign to freeze and, in some cases, reduce the minimum wage.

A quick look around shows that, when the planned 2010 increase was frozen, the CRFA wrote: "CRFA thanks those members who wrote to Premier Stelmach and the Employment and Immigration Minister over the past year in support of our minimum wage position."

It also noted: "In a follow-up meeting, CRFA thanked Employment and Immigration Minister Thomas Lukaszuk for these actions and reiterated the need for minimum wage stability, adequate notice of increases, and the introduction of training wage and gratuity differentials." Perhaps that meeting is the one pictured here?

When the review was announced, the CFRA then encouraged members to sign this form letter. The CRFA's own submission can be found here.

The point of this is that it looks like a special interest group's lobbying influenced the Minister's decision to suspend the planned minimum wage increase and review the government's three-year old policy--decisions that withheld a needed wage increase for the most vulnerable of Alberta's workers. It is not often that one gets a glimpse of how public policy is made in Alberta.

The question this ought to raise for all workers is whether a similar approach to government by, say, a poverty action group seeking an immediate increase in the minimum wage would have triggered such dramatic action by the Minister and the government? If the government wouldn't have taken similar action on behalf of a non-business group, that likely tells us something important and disturbing about the biases of Minister Lukaszuk and the conservative government around the regulation of employment.

-- Bob Barnetson

Friday, September 3, 2010

An insider's view of OHS policy making

My colleague Jason Foster has just had an article published examining social dialogue as a way of setting employment regulations. "Talking ourselves to death? The prospects for social dialogue in North America--Lessons from Alberta" uses two case studies to examine the efficacy of this approach.

Foster considers the complex decisions that unions face about whether to participate in these forms of consultation. Of particular interest are his conclusions about the opportunity costs that comes with engagement as well as the largely defensive nature of the "gains" labour can make in such a process.

The cases also provide an insider's perspective on occupational health and safety policy making in Alberta. This is particularly relevant given the scrutiny the government has faced this summer over its poor record on prosecuting workplace fatalities. The most recent development here is the government's decision (eight years after it first promised to) to release data about employer safety records.

The injury data to be released, however, provides only a partial and, frankly, misleading view of workplace safety. It is unclear yet whether the government will respond to calls to release employer inspection data. Today the Minister suggested the laying of charges for a 2008 death was a sign the province will be "lowering the hammer" on unsafe employers.

While prosecutions after a worker has been killed on the job may sate our desire for justice, the real goal is prevent injuries. Alberta does a poor job of that. In 2009, there were 149,000-odd reported workplace injuries where workers at a minimum had to seek medical treatment for an injury they got a work. Given the degree of under-reporting or workplace injuries, the real number of injuries is likely close to double that.

The crux of the issue is whether the government will pony up the money to fund an effective inspection system. Right now the government spends about $2 million a year on OHS--the rest of the $23 million or so comes from the WCB. There is also the question of whether the government is prepared to accept the political backlash they will get from employers if there are more inspection.

Yet is there really any other alternative but more inspections if fewer injuries are to occur? If inspections are randomly distributed (and they likely are not), the present system sees each workplace inspected about once every 25 years--yes, Alberta has a once-a-generation inspection cycle. Despite all of the other levers the government has pulled (financial incentives, gory posters, pretty awards, stirring speeches), there are still 149,000 injuries annually. Clearly something significant needs to change in the government's approach.

-- Bob Barnetson

Tuesday, August 31, 2010

OHS in downsizing, outsourcing and homework

Precarious employment—work characterized by poor wages, few benefits, difficulty accessing statutory protections and entitlements, and job insecurity—is an important theme in the study of labour and employment.

The risk of workplace injury is of particular concern for precarious workers. Two recent review article provide an overview of the health and safety effects of organizational choices such as downsizing, outsourcing and home work.

In “Under pressure, out of control, or home alone? Reviewing research and policy debates on the occupational health and safety effects of outsourcing and home-based work”, Australian researchers Michael Quinlan and Philip Bohle examined 25 studies to determine the effects of subcontracting and home-based work to determine whether such arrangements exposed workers to greater risk of injury, illness or assault.

Ninety-two percent of the studies found poorer OHS outcomes with the remainder finding mixed effects. The mix of research methods and indicators of OHS in the 25 studies reviewed make these finding persuasive. The authors suggest that economic pressures on workers (encouraging greater work intensity and compromised standards), disorganization (i.e., a lack of systematic training and supervision) and regulatory failure (i.e., difficulty in ensuring statutory minimums are met) all contribute to these outcomes.

A second study by the same authors (“Overstretched and unreciprocated commitment: Reviewing research on the occupational health and safety effects of downsizing and job insecurity”) considers the OHS effects of restructuring and downsizing. The resulting use of temporary workers and rising job insecurity exhibits dimensions of precariousness. Of the 86 studies identified, 85% found poorer OHS outcomes, 8% found mixed effects, 5.8% finding no effect and 1.2% finding a positive effect. The authors again use notions of economic pressures, disorganization and regulatory failure to explain these poorer outcomes.

Overall, these studies add substantial weight to the notion that precarious work can increase the risks faced by workers. They also provide a useful theoretical framework within which to study individual workplaces.

-- Bob Barnetson

Friday, August 20, 2010

Injury risk for immigrants and women

There have been few Canadian studies of the relationship between injury rates and immigration status. A 2009 study, for example, reports immigrant men in their first five years in Canada had a lower rate of activity-limiting injuries but were more likely to require medical attention for them (versus Canadian-born male workers).

A new study published in the American journal of industrial medicine examined the risk of experiencing a compensated injury in Montreal, with specific attention to demographic descriptors such as gender, ethnicity, linguistic group and immigration status.

"Are immigrants, ethnic and linguistic minorities over-represented in jobs with a high level of compensated risk? Results from a Montréal, Canada study using census and workers' compensation data" found immigrants as well as ethnic and linguistic minorities tend to work in more dangerous occupations, although this relationship appears stronger for women.

The propensity of immigrants as well as ethnic and linguistic minorities to under-report injuries (as well as the spectre of under-compensation) make it difficult to determine whether this translates into a greater risk of injury. Yet the study does point out a potential source of social inequity in occupational health and safety via the distribution of risky work along demographic lines. More plainly, higher rates of injury among minority groups may be caused by occupational segregation rather than a characteristic or behaviour prevalent within such a group.

Tuesday, August 17, 2010

Workplace fatalities in Alberta

Following a recent Calgary Herald series that addressed how the provincial government handles workplace fatalities, the Alberta Federation of Labour has conducted some additional research into Alberta prosecution rates.

The crux of the AFL's complaints are that (1) it takes a long time (often 4 years) to get a conviction, (2) convictions are sought and achieved in a small minority of cases, and (3) fines are low and sometimes not collected. Overall, delay and low fines create little incentive for employers to change their occupational health and safety practices.

There is some literature to support this assertion. A 2007 study (E. Tompa, S. Trevithick and C. McLeod, “Systematic Review of the Prevention Incentives of Insurance and Regulatory Mechanisms for Occupational Health and Safety,” Scandinavian Journal of Work, Environment and Health 33(2) (2007): 85-95) found limited evidence that health and safety inspections resulted in fewer or less severe injuries. There was also only mixed evidence that the prospect of being penalized for health and safety violations lead to fewer or less severe injuries.

The researchers suggest several possible explanations, including the penalties may not be significant enough to motivate compliance. It may also be that organizations do not always act rationally. Tompa et al. did find strong evidence that actually being penalized led to a reduction in injuries. This suggests that enforcement of regulations can positively affect workplace safety. All of this and more is available in my new book, The political economy of workplace injury in Canada which you can download for free as an open-source e-book.

-- Bob Barnetson

Thursday, August 12, 2010

Precarious work and injury compensation

A recent study in the American journal of industrial medicine examined whether particular groups of labor force participants were more or less likely to receive compensation following an absence from work of one week or longer due to a work-related injury or illness.

The study "Differences in access to wage replacement benefits for absences due to work-related injury or illness in Canada" concludes that women, younger workers, recent immigrants, part-time employees, employees with shorter job tenures, those from small workplaces, and those who were not members of a union or collective bargaining agreements were all less likely to receive any form of income replacement during their work absence. While the authors do not explicitly tie the results to the concept of precarious work, these groups workers and/or job characteristics are frequently associated with precarious employment.

The study also highlight the importance of legislated employment rights to specific subgroups of workers. Recent immigrants, younger workers, or workers with short job tenure were unlikely to receive any employer-benefits during absences caused by workplace injuries other than workers' compensation. Overall, approximately 50% of the study's subjects receive no
workers’ compensation income and just over 20% received no compensation whatsoever during their absence.

Tuesday, August 10, 2010

Gender discrimination and precarious employment

A recent article in Relations Industrielles/Industrial Relations by Marisa Young sheds some new light on gender and precarious employment.

“Gender differences in precarious work settings” uses US data to examine two competing theories about why women are over-represented in precarious work settings: human capital theory (i.e., women make different choices than men about skills development) and gender stratification (i.e., women are discriminated against).

The study confirms what most practitioners would expect. Women typically have less work experience than men and women typically spend more time on family commitments than men. Women are also typically earn less than men and are more likely to work part-time. The value of the study is that it analyzes the contributions of work experience and family commitments to the incidence of lower pay and part-time employment.

The gist of Young’s conclusions are these:

1. Controlling for education and experience, men receive higher wages and are less likely to work part-time than women.
2. Controlling for time spent on family commitments, women appear more penalized ( in the form of lower pay and part-time employment) than men for undertaking these tasks.
3. While human capital investments do decrease the likelihood of precarious employment, they do so less effectively for women than for men, in part because of underlying gender discrimination in the workplace.

In short, these findings suggest that employer discrimination makes an independent contribution greater job precariousness for women than men. This finding makes it more difficult to dismiss gender differences in the likelihood precarious employment as a function of women’s choices and forces us to consider discrimination as a source of difference.

Thursday, August 5, 2010

Farm Workers to Remain Excluded

While government consultations are still continuing, the Calgary Herald is reporting that farm workers will continue to be excluded from Alberta's occupational health and safety and workers' compensation laws. This seems like an odd choice, given the Minister of Employment's announcement last week that he will be improving Alberta's OHS system in the wake of the Auditor General's report from April.

“Let this serve as official notice for any Alberta company that doesn’t want to play by the rules,” said Minister Lukaszuk. “Today is a new day for Occupational Health and Safety in Alberta.” Unless, it seems, you are n employer in an occupation that falls outside the rules due to statutory exclusions.

Alberta farm workers remain one of Canada's least protected employee groups. Farm and ranch employees are not subject to minimum wage, hour of work, overtime, vacation pay, general holiday pay, rest periods and child labour provisions of the Employment Standards Code. Farm and ranch workers are also excluded from labour legislation that regulates unionization and collective bargaining, thereby effectively precluding these activities by workers.

Farm and ranch workers are exempted from health and safety legislation by regulation. By contrast, Ontario brought farm workers under the ambit of its OHS legislation in 2006. And workers’ compensation coverage is not mandatory for farm workers, although employers can purchase optional coverage . Workers whose employers do not voluntarily purchase workers’ compensation insurance are left to pursue recourse for injuries through the courts or private insurance schemes, routes employees have traditionally had difficulty accessing.

An important question is why exclude a vulnerable group from basic employment rights broadly available throughout Canada? This article suggests that doing so runs contrary to the interests of the state, agricultural corporations and farmers. And that the gerrymandering of Alberta's electoral boundaries to ensure rural voters are over-represented creates a political imperative for the government to maintain the exclusion, particularly in light of the political threat posed by the Wild Rose Alliance.

Unfortunately for agricultural workers, this means they have effectively no statutory protection on the job.

-- Bob Barnetson

Thursday, June 24, 2010

Privacy and Safety in the Workplace

Two interesting newspaper articles have appeared this week.

The first is a privacy commissioner ruling regarding an email sent following an employee resignation. According to the article, " two managers sent out a memo that a "difficult" staffer quit to take a new job and that her new boss would need some luck to deal with her."

The commissioner ruled that this was a release of the employee's personal information without her consent. This ruling draws attention to how privacy laws are (or ought to!) alter human resource practices in the private sector.

The second is an in-depth investigation of how Alberta treats workplace deaths. In short, prosecution is rare, even for repeat offenders. There are a couple of interesting facts:

1. Alberta spends nearly five-times more money on insurance rebates to Alberta companies with government-endorsed safety certificates ($70 million in 2009) than it spends inspecting job sites and enforcing occupational safety laws ($15 million in 2009-10). These rebates are available to companies with worker fatalities--even those with multiple deaths.

2. Of those workers killed on the job since 2003, three-quarters occurred on worksites where inspectors identified safety violations. Only one-third of these cases were prosecuted to a verdict.

3. Several former OHS investigators express frustration with the lack of support for prosecutions.

Employment Minister Thomas Lukaszuk comments are important:

“If there are ideas and there are mechanisms that will make our workplace safer, I’m open to looking at it."

This is a common answer from Lukaszuk on OHS issues. While it seems reasonable enough at first glance, it places the responsibility for ensuring the laws are enforced on the shoulders of worker advocates (who must then often face opposition on committees from employer representatives).

Further, it glosses over the fact that the government modified the legislation eight years ago to allow on-the-spot fines and naming Alberta’s worst safety performers. The lack of action on implementing these provision is not about not having ideas or being restricted by the legislation. It reflects a lack of political will on the part of at least four successive Ministers to lower the boom on unsafe employers. The cost of this inaction is borne by workers and their families in the form of injuries and death.

-- Bob Barnetson

PS: Things will be quiet here the next month as I take a vacation.

Tuesday, June 15, 2010

Living Wage in Alberta

An interesting article kicked up on the Edmonton Journal website today. In short, it reports StatCan data suggesting 224,000 Albertans (13.7% of the workforce) earn less than $12 a hour--the amount needed to get over the low-income cutoff for StatCan (sometimes called the poverty line, a characterization StatCan does not agree with). Over 112,000 Albertans earn less than $10 an hour.

This information comes courtesy of Public Interest Alberta, a not-for-profit group that provides advice and commentary on issues of public interest. A region breakdown of the data is available.

There is an interesting gendered aspect to this data: "The statistics reveal that 58% of people earning less than $10/ hour are women over 20 years of age (17% are older than 45) and women make up 62% of low-income earners."

This data is released as the province's Standing Committee on the Economy is holding hearings on the future of the minimum wage. PIA has made a presentation to the Committee. Of particular interest is slide 5 which shows the real-dollar value of the minimum wage over time.

My own submission to the Committee is available here.

-- Bob Barnetson

Monday, June 7, 2010

Quebec Farm Workers can Unionize

Agricultural workers are frequently exempted from statutory employment rights in Canada. In recent years, this has been changing. For example, Ontario has been compelled to provide farm workers with the ability to unionized and collectively bargain , although this is presently under appeal to the Supreme Court and Manitoba has included agricultural workers in its employment standards legislation.

Last week, the Quebec Labour Relations Board ruled that Labour Code provisions of the that effectively preclude seasonal farm workers from gaining collective bargaining rights breaches the freedom of association guaranteed in s.2(d) of the Canadian Charter of Rights and Freedoms.

The provision required a minimum of three workers be "continuously" employed at a farm if collective bargaining rights are sought, works against seasonal migrant workers (mainly from Latin America). As a result, the LRB certified a bargaining unit of six Mexican migrant workers at a vegetable farm near Mirabel.

Here in Alberta, farm workers are excluded from minimum wage, hour of work, overtime, vacation pay, general holiday pay, rest periods and child labour provisions of the Employment Standards Code. The Labour Relations Code precludes farm workers from organizing and the Occupational Health and Safety Act does not apply. Finally, employers are not required to have workers’ compensation coverage for farm workers. No other province is a thorough as Alberta in excluding agricultural workers from basic statutory employment rights.

An interesting question is why does Alberta treat farm workers this way? While too long to summarize in a blog post, this article suggests how the interests of farmers, the state and capital intertwine to maintain this arrangement. It is unclear how long Alberta will be able to resist the current wave of constitutional arguments against these exclusions.

-- Bob Barnetson

Monday, May 31, 2010

Firefighter WCB Coverage Expanded

Most workers who are injured on the job are eligible for workers’ compensation coverage if their injury is deemed to have arisen out of and occurred in the course of employment. The compensability of occupational diseases (e.g., cancer) is often more difficult to determine than that of acute injuries (e.g., a severed limb) because of the long latency period and murky causality associated with most diseases.

Alberta has identified a schedule of diseases that are deemed automatically compensable if a worker has had significant occupational exposure (Schedule B of the Workers’ Compensation Regulation). Occupational cancer is of specific concern to workers, with the Auditor General noting that the Alberta Cancer Board believes that as many as 760 of the 5,700 new cancer cases identified each year (13.3%) were work-related. Yet, in 2008, only 31 new cancer-related claims were recorded by the WCB.

To its credit, Alberta has specified a list of cancers among firefighters that are deemed automatically compensable. And, on May 14, Alberta announced it would increase the types of firefighter cancers deemed automatically compensable from 8 to 10. This is clearly a good news story for firefighters with cancer, but the announcement can stand some unpacking.

Minister of Employment and Immigration Thomas Lukaszuk noted “If (firefighters) have the science to show me that other cancers also fall into the category where the rate of incidence is identifiably higher than others, I'm always willing to look at them. But the science has to be there."

This statement sounds quite reasonable: prove the occupational link and we’ll deem it covered. But consider what this means practically: the government intends to delay acknowledging further forms of cancer are presumed work-related until so many firefighters have died from a form of cancer that the causation is irrefutable. Until then, firefighters with cancer must go through the difficult and stressful process of determining compensability.

The Minister’s statement also ignores that proving causation is very difficult. There are more than 70,000 chemical substances in use in North America. Another 800 substances are introduced each year. There is no toxicity data available for 80% of these substances and the data for many of them is highly questionable. Further, demonstrating (or even recognizing) causation is very difficult due to the long latency period and murky causality of many diseases and the (understandable) focus of doctors on treatment, rather than sussing out occupational contributions.

The Minister’s statement further ignores the state’s role in causing occupational diseases. There is no legal obligation on manufacturers or employers to determine the hazardous properties of products before introducing them into the workplace. Consequently, workers are often the first humans to experience prolonged and significant exposure to these substances. This is a policy choice by government that prioritizes the right of manufacturers to create and employers to use substances over the right of workers to know about their hazardous effects.

Finally, while firefighters with some forms of cancer have gained an even greater degree of automatic compensation, there has been little effort focused on addressing other groups who routinely find themselves exposed to hazardous chemicals in the workplace, such as cleaners and healthcare workers. Perhaps the clarity of the firefighter data or the nobility of firefighting accounts for their preferential treatment. But it should not be lost on us that the majority of firefighters are white men and the majority of cleaners and healthcare workers are women and, often, minorities.

-- Bob Barnetson

Tuesday, May 25, 2010

Minimum Wage Review

Alberta's Standing Committee on the Economy is requesting submissions regarding Alberta's minimum wage policy. This follows Alberta's decision not to increase the minimum wage by 12 cents an hour this spring. Here is my submission:

Naresh Bhardwaj, MLA
Chair, Standing Committee on the Economy
801 Legislature Annex, 9718 107th Street
Edmonton, AB T5K1E4

Dear Chairman Bhardwaj:

Thank you for the opportunity to comment upon Alberta’s minimum wage policy.

Why have a minimum wage?
Minimum wage laws stipulate the least compensation society deems to be acceptable for employment. These laws have been developed because employers seek to minimize wages as one way to maximize profitability. Workers must engage in employment in order to afford the necessities of life. This need for income gives employers a powerful lever (sometimes called the “whip of hunger”) that employers use to strike a wage-rate bargain that is maximally advantageous for the employer.

Practically, this plays out as follows. When there are more workers than jobs (the usual case) employers pit workers (who must have a job) against one another to drive down wages. For example, an employer may offer one worker $5.00 an hour. If that worker accepts (because she needs to feed her children), the employer is then able to say to another worker: “Jane will work for $5. If you want the job instead, you need to work for $4.50.”

The historical result of this dynamic has been exploitative wages (often most disadvantaging women, minorities and young persons), grinding poverty and social instability. A legislated minimum wage helps protect the most vulnerable workers from this scenario by setting a wage floor below which no employer may go.

Alberta’s minimum wage
Alberta’s minimum wage is $8.80 an hour. Assuming a 40-hour workweek for 50 weeks per year, Alberta’s minimum wage means an annual gross income of approximately $18,000 (when you factor in vacation pay). Alberta does not have a clear statement about the purpose of its minimum wage policy or the criteria upon which the minimum wage is set. But let’s assume that underlying purpose of stipulating a minimum wage is to ensure workers can earn enough money to get by with from month to month.

A minimum-wage worker has about $1500 per month (before taxes) with which to purchase shelter, food, clothing and other necessities. So let’s work out a basic budget:

• The average monthly rent for a two-bedroom apartment in Edmonton in 2009 was $1059, so let’s assume a single person, sharing an apartment, has a rent of $525 and ignore the possible cost of utilities.
• A worker needs some way to get around so let’s assume a bus pass, which costs about $75 a month.
• Add on a very minimal $200 for food (based on Alberta Agriculture and Rural Development estimates) and sparse $150 for clothing, toiletries and other essentials.
• Source deductions (tax, CCP, EI) will run about $150 a month.

This leaves about $400 a month for all other expenses, including medical and dental care, emergencies, better food, a cup of coffee once in awhile and entertainment. If the worker has dependents, additional groceries and childcare costs alone will easily eliminate this $400.

Who earns the minimum wage in Alberta?
Approximately 1.4% of the workforce (~20,000 Albertans) earns the minimum wage. Data is not available on the number of workers who earn just over the minimum wage. It is often thought that minimum wage earners are primarily teenagers earning pocket money and thus not responsible for many of the costs set out above. This is untrue.

The majority of minimum wage earners are women (~70%), over the age of 24 (~61%) and have permanent jobs (~80%). This suggests that minimum wage earners are mostly working adult women attempting to earn a living. About half of minimum wage workers have high school or less and thus comprise a very vulnerable sector of the labour market with relatively few options in the workforce.

Adjustment of minimum wage
If the minimum wage is meant to ensure workers can earn enough money to get by with from month to month, then it makes sense to periodically adjust the minimum wage to account for changing prices. Some governments make periodic adjustments at the discretion of the Legislature or cabinet. Alberta previously used this system.

Discretionary systems have some drawbacks. Increasing the minimum wage causes political backlash, thus governments tend to do so only infrequently. This means the minimum wage does not keep pace with cost of living increases for these vulnerable workers. These multi-year delays also means increases (when they do happen) tend to be large, causing significant backlash from employers.

In 2007, Alberta linked annual changes to the minimum wage to changes in average weekly earnings. This allows for small, regular changes indexed to average wages. But then, in March or 2010, Alberta pre-empted the scheduled increase in the minimum wage. Minister Lukaszuk indicated that “This decision reflects what government feels will both protect jobs during these uncertain economic times and support the economy.” The proposition that a 12-cent-an-hour increase (approximately $240 per year per worker) would have derailed the economic recovery is not credible, but it does raise the issue of the relationship between minimum wages and employment levels.

Are minimum wages and employment linked?
There are mixed opinions among academics about whether increases in the minimum wage will have any negative effect on employment levels. While I am not a labour economist, my reading of the research shows it to indicate “sometimes yes, sometimes no”. It is unclear what explains the unevenness of the effect.

While the technicalities of this research are interesting, looking for a definitive answer often distract from the fact that a minimum wage is not primarily an economic policy. Rather, it is primarily a social policy because the purposes are (1) to ensure workers earn wages they can survive on and (2) prevent workers’ exploitation. For this reason, we should not use economic criteria (e.g., impact on employment levels, impact on employers) as the main basis upon which to evaluate the minimum wage. Rather, we should ask ourselves if the minimum wage allows workers to survive.

That said, economic considerations can (and likely will) play a part in decisions to increase the minimum wage. But they need to be seen in context and realistically. The Minister’s intimation that a 12-cent-an-hour increase might jeopardize the economic recovery is simply not credible. While a $240 a year increase in wage costs will have some impact on the profitability of businesses, it seems doubtful that many employers will be significantly impacted. Indeed, some employers will be positively impacted because their workers will now be able to spend an additional $240 per year.

More importantly, a $240 annual increase means the working poor—mostly women—will be better able to feed, clothe and house themselves and their families. This is, of course, the ultimate goal of minimum wage laws. In the unlikely event that some employers are forced to close their doors, we need to ask is this a bad outcome? That is to say, is it the government’s job to prop up businesses that are so economically marginal that a $240 a year increase in wages will cause them to fold? And should that support come in the form of denying the working poor a 12-cent-an-hour increase? Clearly the answer to both questions is no.

The Committee is requesting advice on the minimum wage policy. To be brief, I think the government had the basic elements correct before the Minister intervened:

1. There was a minimum wage.
2. There was a mechanism for periodic adjustment.
3. The periodic adjustment was related (if indirectly) to changes in costs faced by low-income workers.

I think you might profitably explore other indicators to index the periodic change to, such as the consumer price index. Yet using the annual change in average weekly earnings has the appeal of parity: it is what changes in MLA compensation are based on.

Thank you for the opportunity to provide input into your committee’s deliberations.


Bob Barnetson

Tuesday, May 18, 2010

Temporary Foreign Workers

The Calgary Herald is reporting that 18 bus drivers brought from England a year and a half ago as temporary foreign workers (TFWs) will be forced to return as their work permits expire. These drivers are among the tens of thousands of TFWs—some 57,843 on December 1, 2008—hired during the recent economic boom.

Alberta is not alone in using migrant workers. There were 252,196 TFWs in Canada in 2008—20 times the per-capita rate in the United States. Ontario, for example, has relied on migrant agricultural workers for decades.

While TFW are often thought to meet a need for skilled workers. But approximately half of Alberta’s TFWs work in unskilled jobs. While the economic downturn has resulted in many skilled TFWs returning to their home country, those in low-skill job have remained. In effect, the government’s TFW program is creating a permanent class of migrant workers who do the worst jobs.

A recent development is the interesting suggestion that employers continue to seek TFWs in field where there are not worker shortages. This may reflect employer’s desire for a more easily manipulated workforce.

TFW are easily manipulated because they are particularly vulnerable workers. Their work permits are employer and job specific. That is to say, they have virtually no realistic options for employment if they are treated poorly and want to quit. And complaining to the government carries with it a very real risk of termination. While this sort of retribution is illegal, it is an endemic feature of Canada’s workplaces. The temptation for many employers to break the law is great.

This became evident almost immediately upon expansion of the TFW program, with more than 800 complaints received by Alberta between 2006 and 2008. These complaints centred on unfair wage deductions, fees charged by recruitment agencies and accommodation problems. These issues are typical ways that the powerful exploit the less powerful in the workplace.

In late 2007, Alberta dedicated eight employment standards inspectors to investigate TFW complaints and carry out inspections. Whether eight inspectors enforcing only provincial laws are having a meaningful impact on the situation is highly contestable. Educational campaigns aimed at workers were also carried out—although targeting the victims rather than the perpetrators seems misplaced.

A typical example of the problems that emerge can be seen at an Okotok’s A&W. TFWs there have filed numerous complaints about their treatment. One employee, seeking her employer’s help in converting her temporary visa to a permanent one, alleges she was told could have the requisite supervisor’s position, but only if she returned the associated raise to the employer under the table.

When she refused, she was terminated because “downsizing was necessary”--even though the A&W continued to advertise for workers. The worker also alleged the employer charged 130% more for accommodation than allowed. When the employee complained to Alberta’s temporary foreign workers office, it referred her to other government agencies. If the foreign worker does not follow up on the referrals, the complaint is forwarded to employment standards.

Things seem to be worsening for TFW with the economic downturn. In 2009, 74% of TFW employers inspected by the province violated employment standards. In 2008, only 56% of employers were found non-compliant. Half of the violations were for failing to pay workers properly for overtime, vacations and statutory holidays.

Bizarrely, Minister of Employment and Immigration Thomas Lukaszuk called this a "really good news story". His rationale was that a high percentage of valid complaints indicated worker education efforts were successful. This seems to ignore that a high percentage of employer’s violating the floor of rights—the minimally acceptable treatment in our society—suggests that these vulnerable workers are being exploited.

-- Bob Barnetson

Friday, May 14, 2010

Minimum Wage in Alberta

In March, Alberta announced it would freeze an expected 12-cent-per-hour increase in its (present) $8.80 per hour minimum wage. “This decision reflects what government feels will both protect jobs during these uncertain economic times and support the economy,” said Thomas Lukaszuk, Minister of Employment and Immigration.

In effect, the government asserted that increasing minimum wage costs by 1.4% for the 1.5% of the workforce earning the minimum wage would somehow result in job losses or impede the economic recovery.

There is quite a lot of debate regarding the impact of increasing the minimum wage on job number. On the one hand, the Fraser Institute argues the case is clear: increasing the minimum wage reduces employment. Of course, increasing the minimum wage also reduces the profitability of businesses (slightly), which runs contrary to the interests of the Fraser Institute’s funders.

On the other hand, the Canadian Centre for Policy Alternatives argues there is little evidence of rising minimum wages having any impact on employment numbers. Further, neither the Organization for Economic Co-operation and Development nor the International Labour Organization believe that increasing the minimum wage is a significant cause of job loss.

This technical discussion is interesting but it distracts us from the real policy issue: the purpose of the minimum wage (and, more broadly, the floor of rights) is to ensure workers are not employed at an unacceptable wage.

This suggests Lukaszuk needs to ask himself if subsidizing marginal businesses -- businesses that would presumably go under if wages went up some $240 per year -- on the backs of the lowest-wage earners is consistent with the public policy objective of a minimum wage.

It seems to me that holding the minimum wage steady simply ensures the 1.5 per cent of Albertans who earn the minimum wage will be less able to afford the necessities of life. These minimum wage earners -- the working poor -- are mostly women and have little education. Working full time, they can expect to earn a before-tax annual income of $17,600 for full-time work -- $3,500 less than the 2006 low-income cut-off (i. e., the poverty line) of $21,202.

-- Bob Barnetson

Monday, May 10, 2010

Health Effects of Shift Work

Approximately one-quarter of Canadian workers are shift workers. Excluding occupations requiring 24-hour staffing (e.g., emergency services), shift work is a way for employers to maximize the use of machinery and other physical capital.

The Institute for Work and Health recently released a summary of its symposium on the health effects of shift work. A high-level briefing is available here. Among the more alarming impacts of shift work on workers are:

1. Shift work appears to elevate the risk of breast cancer and possibly colorectal cancer. There are some studies suggesting that shift work may also elevate the risk of preterm delivery, gastrointestinal disorders and mental health problems.

2. The level of workplace injury is higher among shift workers than among those who work regular shifts. This is particularly the case for shift workers working at night. Among the issues contributing to this is that government regulation (e.g., inspections) of workplaces tends to occur during week days.

It appears possible to mitigate these effects through scheduling changes that constrain shift-work during non-regular hours.

This discussion suggests that the organization of work is not solely a technical undertaking focused on optimizing production schedules. Rather the organization of work can have a significant effect on the health and safety of workers.

-- Bob Barnetson

Friday, May 7, 2010

Injury statistics in Alberta

There has been a flurry of media coverage about workplace injury in Alberta following an April 2010 report by Alberta's auditor general. This report found serious weaknesses in Alberta's occupational health and safety (OHS) system.

The main weaknesses included the absence of a clear system by which to escalate enforcement activity when persuasion is ineffective and the existence of a group of persistent violators (who had higher injury rates), including some who continue to hold Certificates of Recognition for their injury prevention work!

While these issues are important, the report ignores the broader issue of whether overall enforcement activity is adequate to protect workers (the ultimate purpose of the OHS Act and Code). The Alberta Federation of Labour quickly released a report that highlights some of the failings of the OHS system.

Both the AFL and government reports use workers' compensation board (WCB) statistics as a measure of injury. For example, in 2007 the WCB reported it accepted about 175,297 new accepted injury claims and 154 fatalities. These numbers do not address injuries not report, claims not accepted and injuries in workplaces not covered by workers' compensation.

The real number of injuries in 2007 was more like 321,378. If these injuries were distributed evenly throughout the workforce, that would be about 1 in 5 workers. These numbers largely exclude most instances of occupational disease. If included, these would further drive up the number.

This high number of injuries suggests that (1) many workplaces are dangerous and (2) OHS enforcement is not effective. Ineffective enforcement is easily explain: there are simply not enough resources and no political will to enforce the law. Consider these statistics:

Inspectors: In 2008, Alberta had 84 health and safety inspectors, 144,000 employers and 2,013,300 employees. This means there was 1 inspector for every 1714 employers (many of whom have more than one worksite) and every 23,968 workers. These ratios explain why it takes the government an average of 18 days to respond to a report about an unsafe worksite. Even when unsafe conditions are found, it takes an average of 86 days to remedy them.

Inspections: The Auditor General’s report suggests there were 9600 site visits in 2008, although many of these inspections were repeat visits to the same employer. It may be more accurate to look at 2004 data on the number of worksites inspected (5237). If we (charitably) assume each of Alberta’s 140,000+ employers had only one worksite, it would take more than 26 years for every worksite to receive a single visit. In 2007/08, inspectors issued 3392 orders, approximately one per 100 workplace injuries.

Prosecutions: In 2008, Alberta reported 22 successful prosecutions under the Occupational Health and Safety Code for violations going as far back as 2004. During this time, Alberta recorded approximately 700 occupational fatalities. The largest fine was $419,250 for a 2004 violation. That sounds impressive. When compared to the company’s annual revenues of $47 million in 2007, such fine is akin a person with an annual income of $50,000 getting a $440 ticket—about same fine you’d get for doing 80kmh in a construction zone. Prosecution numbers actually dropped in 2009, with only 9 prosecutions and the highest fine being $300,000.

The upshot is that (1) Alberta employers are unlikely to be inspected even if there is an injury, (2) they face little chance of prosecution even if they kill or maim a worker, and (3) prosecution results in a relative small fine. Given this, it is hardly surprising that injury numbers are high.

The Minister of Employment and Immigration Thomas Lukaszuk recently patted his department on the back, noting a decline in injury numbers in 2009. “We’ve made good progress reducing workplace injuries but we can still do better.” Setting aside that this reduction likely has more to do with declining employment in dangerous occupations as a result of the recession than anything his department has done, Alberta certainly can do better. A place to start would be with OHS funding.

In 2008/09, Alberta spent about $23.3 million on OHS, of which $21.7 million came from the WCB (i.e., surplus employer premiums). That is to say, the government contributed about $1.6 million to OHS work. What this suggests is that ineffective OHS enforcement is a direct result of the government choosing to restrict funding. In this way, Alberta's injury rate is a political choice about funding levels and how much intervention in the workplace is acceptable rather than being the product of chance or carelessness.

-- Bob Barnetson