“Labor Reform”:  Proposals to Maximize Workplace Bullying

This is a excerpt of an article by James Petras

Many management consultants, government officials and financial journalists are proposing, what they dub, “labor reforms” and “labor market flexibility” as the solution for double-digit unemployment, economic stagnation and the decline of manufacturing investments in the United States and Europe. “Labor reform”, however, is just a euphemism for the reversal of laws and practices that workers and employees secured through decades of struggle against employers. The idea that “labor reforms,” like mass firings, tiered salary and retirement schemes, forced retirement and work pace speed-ups, would create jobs for the unemployed has been tried and disproven over the past decades. One need look no further than the stagnant economies of “labor reform” testing grounds like Portugal, Ireland, Greece, Spain, France, and Upstate New York.

Labor Reform” Concentrate power in the hands of bosses and capitalists

“Labor market flexibility” is actually about increasing the power of bosses to reduce wages, dictate work rules, intensify management bullying and fire workers without just cause. “Labor reforms” are not policies designed to end unemployment, encourage economic recovery and increase capital expenditure. By concentrating power in the hands of the bosses, labor costs are lower and stockholder profits are increased at the expense of workers. That is the principle goal of “labor reform”: increasing the power of the capitalist class. The growing disparity of power between capital and labor resulting from “labor reforms” is the key factor producing inequality.

Labor Reform” and Intensity Workplace Bullying

Most liberals focus on the problems of sexual harassment and intra-working class bullying. These problems certainly require attention and correction. But far more pervasive and consequential is management harassment of workers. Because ‘labor reforms’ allow management to fire workers without due process and because union shop stewards do not exist in 88% of workplaces, bosses are able to arbitrarily increase work assignments and downgrade work performance. Many times done through verbal and/or physical abuse. Because management no longer faces workplace solidarity: it can abuse workers, isolate and harass them. Any self-defense is immediately interpreted as insubordination and the worker is fired – an example to others to unconditionally submit. Intimidation takes the form of hiring temporary low-wage workers to compete with permanent employees, or threatening to ‘relocate’ the factory.

Bullying has an economic function

Bullying is designed to increase output, induce obedience and raise profits. But management bullying has profound negative psycho-social effects on workers. Verbal abuse, face to face intimidation, arbitrary downgrading without recourse and other everyday indignities cause depression, a loss of self-worth dignity. This leads to self-abuse, worker and family violence and/or a ‘chain of bullying’ of those below: children, spouses, neighbors and outsiders (immigrants).

The bullying by management does not merely express itself in victimizing workers but also in forcing them to enter in “co-operative relations” where they are supposed to “share” tasks, responsibilities and innovations, without rewards or say in the distribution of material benefits or in the shaping of workplace power relations. It’s bad enough to be bullied and exploited, its worse to be forced to co-operate with management bullies, to smile at indignities and praise the degrading relationships.

Workplace bullying by management is the starting point in an extended chain of domination and exploitation that stretches from the highest levels of corporate headquarters to the lowest office and workplace. This is the silent majority who tell the pollsters they oppose Wall Street, they want a national health system for their family, affordable higher education for their children and secure employment for themselves, but cannot strike (because they are bullied, etc) or bring themselves to authorize this oppressive system by voting.

The Most Vulnerable: Unemployed, Temporary and Young Workers

The most brutalized sectors of the workforce are the unemployed and temporary young workers, the supposed beneficiaries of “labor market flexibility.” In fact, lowering the status of employed workers has not created jobs for the unemployed. Temporary workers are hired at the lowest level, paid less than half the wage of permanent workers and can be fired with no notice. Most young ‘temps’ work with the promise of a permanent job and are driven to compete with a multitude of others just like them. Unemployed workers are subject to intense interviewing processes that go far beyond their work capabilities. Temporary workers are encouraged by management to exceed existing work norms, and work overtime without pay, thus fostering animosity and hostility among permanent workers. Veteran workers fear that younger workers they are assigned to train will take their jobs or force them into early retirement.

The unemployed are there to pressure the temp; the temp is employed to compete with the permanent; the young are hired to replace older workers near retirement age to lower pension payments. Management fosters distrust, hostility, competition and bullying among workers which undermines solidarity by dividing workers between temps and ‘permanent’ workers so they can dominate, intimidate and exploit both.

The on-going drive to strip workers of all protective social legislation and eliminate trade unions in order to increase profits has allowed capitalists to invest less in job training. Management bullying at the workplace is endemic because individual workers have no redress, lack solidarity. Rather they have the “choice” of submitting to daily abuse until it becomes unbearable, or quitting. Management can always find cheap replacements that are more submissive, more willing to endure added job tasks for lesser pay. Management bullying is a tool to remove and replace competent professionals with political or family cronies, especially in the public sector. Organizational loyalty replaces professional competence, leading to a decline of public service and advocacy for the citizens, especially the most vulnerable.

Labor Market Reform as a Cover for the Failures of Capital

As we have noted, stripping labor of its rights and concentrating power in the hands of management has not created jobs, because unemployment and underemployment is the result of capitalist class behavior in the first place! They are not investing in job creation!

Instead CEO’s are paying higher dividends to big stockholders and investment bankers. Corporate directors are channeling billions into acquisitions, buying out competitors and monopolizing markets. They reap huge salaries and bonuses. Corporate strategic planners and accountants relocate corporate offices overseas and stash hundreds of billions of dollars offshore to avoid taxes while reducing the availability of capital for job-creating investments at home (think Burger King’s recent maneuvering).

The corporate elite relocates plants and operations “off-shore” to low-wage countries, in the process firing millions of workers and thus creating a massive pool of unemployed workers. ‘Capital flexibility’, not ‘labor inflexibility’ (job protection), is the decisive factor generating and maintaining high unemployment and underemployment: Capital has the “flexibility” to acquire existing firms instead of creating new plants and jobs; it has the ‘flexibility’ to ‘offshore’ its operations and displace millions and it has the ‘flexibility’ to hoard funds and profits overseas, hidden from domestic taxes.

Workers need a movement to impose ‘capital reforms’: an end to capital flight, mergers, acquisitions and hoarding instead of capital investments. Perhaps the starting point is workplace reform: organizing and fighting management bullying in every day work. Socialism anybody?

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2 Comments on ““Labor Reform”:  Proposals to Maximize Workplace Bullying”

  1. Dean says:

    This article really makes my blood boil!!!

    Laws need to be changed! If its not going to be tolerated in our schools ( people can sue over it ),then it certainly stands to reason that we should not be tolerated in the workplace either! I have been a victim of this before, but NEVER again! It was devastating to my life! I WILL find a way to get compensation for the abuse if it ever happens again, mark my words! Can you say…. Hello… ” Heavy Hitters! ” We need to talk! 🙂

  2. Mike Echon says:

    Thank you for shining a light on the systemic problem of workplace abuse. The capitalist system itself, I believe, IS the problem. It’s top-down hierarchal structure is painfully outdated. Much like feudal society became a relic of the past, capitalism now stands at the precipice of extinction as more and more people who have felt it’s negative forces begin to question its efficacy at promoting a just and civil society.

    Before offshoring, capitalism was a benefit to the working class and a hindrance to very few ( women and minorities, unfortunately, were often still marginalized even as unions thrived). Strong labor unions -and a high demand for workers /production- created the juggernaut that became the United States economy after WWII through to the 1970’s.

    After the economy grew to a point where exponential economic growth was no longer possible for domestic corporations— and the American job market became far too saturated with well-paid female and male union and non-union workers alike (along with the parallel advancements in telecommunications, global logistics, and computers), the offshoring of American jobs and business began en masse in the 1980’s up until the present day. That’s also around the time that bosses felt they could start taking advantage of the excess power they now had over their employees.

    The union, for better or worse, had created a counterbalance to the tyrannical top-down structure inherent to capitalist business for not just unions, but for the entire job market. Even if that business was non-union, it would often mimic the behaviors of a unioninized business to avoid a strike and likewise retain quality help by offering competitive compensatory packages. Pension funds, paid sick leave, overtime pay for anything over 8 hours of work, generous vacation packages, and low-cost health care were just some of the “perks” to be found even at non-union businesses pre-1980’s. Quality workers were usually treated with dignity and respect in order to keep them happy and working at the same place.

    However, this all came to an abrupt end in the period from the 1970’s after the largest class war ever waged by the corporate class began. Workers are now treated as, and aptly named, “human resources” (formerly known as personnel) that can easily be replaced if they are insubordinate or don’t allow for all manner of verbal and mental abuse from those that oversee their work or sign their pay cheque. In a saturated job market, fear is the motivating factor used to manage these “human resources”. The idea is that 10 people are lined up behind you to take your job. All manner of verbal and non-verbal forms of threats, intimidation, and humiliation are tolerated and practiced on a corporate, managerial, and judicial level and remain largely insulated from current labor laws. In short, bullying is an accepted business practice and a necessary one for the capitalist class to maintain control, keeping workers insecure and reliant.


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