Vulnerability and the Legal Organization of Work

Martha Albertson Fineman, Jonathan W. Fineman, Martha Albertson Fineman, Jonathan W. Fineman

• Publisher: Routledge
• Year: 2017
• ISBN:
  9781315518558
• Edition: 1
• Topic: Business
• Subtopic: Business Law
• Index: Business

This book uses the concepts of vulnerability and resilience to analyze the situation of individuals and institutions in the context of the employment relationship. It is based on the premise that both employer and employee are vulnerable to various social, economic, and political forces, although differently so. It demonstrates how in responding to those complementary institutional relationships of employer and employee the state unequally and inequitably favors employers over employees.

Several chapters included in this collection also consider how the state shapes, creates and maintains through law the social identities of employer and employee and how that legal regime operates as the allocation of power and privilege. This unique and fundamental role of the state in defining the employment relationship profoundly affects the respective abilities and degree of resiliency of actual employers and employees.

Other chapters explore how attention to the respective vulnerability and resilience of those who do and those who direct work in assessing the employment relationship can raise fundamental questions of social justice and suggest new avenues for critical engagement with labor and employment law. Collectively, these pieces articulate a framework for imaging what would constitute an appropriately "Responsive State" in the employment context and how those interested in social justice might begin to use the concepts of vulnerability and resilience in their arguments.

Part I
Law and vulnerability

This section begins with the application of vulnerability theory to the existing organization of work in the US. It addresses the transformation of work and the working relationship over time, although certainly one constant across legal cultures and over time remains the need for the state to respond to change. Today, forces such as globalization and technological innovation can render historically settled doctrines governing the organization of work unhelpful, ineffective, or incoherent. How are we to think about the needs of employers and employees and the society, the state and its institutions in the face of such change? What factors, principles, perspectives should guide the next generation of law reform in the organization of work and the working relationship?

The first chapter articulates the problems with the notion of private ordering in which the role of the state is viewed as only responding to specific crises when and if they arise, rather than realizing that law is always actively involved in structuring both work and the relationship between employer and employee. Two basic principles of vulnerability theory are (1) that all individuals and institutions are constantly and universally vulnerable – susceptible to changes in their physical and societal wellbeing, whether those changes are positive or negative in result, and (2) that given the role of societal institutions in providing the resilience that will determine if individuals and social arrangements survive, endure, or thrive, the state must be responsive to vulnerability.

In placing work and the relationships inherent in working within a larger societal context, vulnerability theory highlights the significant interests that exist in the socio-legal organization of work and the working relationship. It also illuminates how questions and concerns raised by considering the respective vulnerabilities of employers and employees are inherently political and ideological.

While there may be similarities in the conceptions of work and working relationships across countries, the legal apparatus for implementing and monitoring those conceptions may differ. Are there preferred methods of regulation and response? How do we judge what is preferable? Whose interests do we consider and what outcomes do we prefer? Can we rehabilitate existing doctrines and principles, fashion novel arguments from centuries-old legal rules? Can we reach back to even more ancient concepts, religious principles historically argued to present a moral frame for governing relations between and among societies, individuals, and institutions?

In the opening chapter, “A vulnerability approach to private ordering of employment,” co-editor Jonathan Fineman argues that US labor law’s reliance on the idea of employment as a private contract ignores the role and interests of society in the structuring of work, and therefore fails to provide a coherent conceptual framework for changing needs and circumstances. He suggests that vulnerability theory can provide a flexible, but robust and comprehensive approach to employment law that is context-specific enough to accommodate adjustments as employment changes over time. In particular, he argues that the concept of resilience, and the state’s obligation to ensure a minimum level of resilience in the face of vulnerability, may serve as a guiding principle to think about all areas of employment law.

Katherine Van Wezel Stone’s piece, “Green shoots in the labor market: a cornucopia of social experiments,” describes changes that have taken place in employment practices and regulation in advanced industrial countries. Stone shows that job security and the other features of the standard contract of employment are fading, and describes measures undertaken in some countries and regions to try to protect workers and to ameliorate the insecurity that present practices generate. The chapter concludes by considering what countries can learn from ameliorative policies and programs in other countries.

In her chapter, “The constitutional right to organize,” Rebecca Zietlow uses vulnerability theory to make the case that workers do indeed have a constitutional right to organize. She notes that when we move beyond the traditional autonomous, independent liberal subject, we see that ability to organize and bargain collectively is essential if we hope to equalize the power imbalance between employers and employees. She proposes that the strongest argument in favor of a constitutional right to organize is that such a right is embedded in our constitutional culture, and thus finds the right not in court rulings but in the years of political advocacy of workers supporting that constitutional vision.

In “Labor rights as natural rights,” Sean Coyle traces the origins of natural law arguments in Catholic theology and finds support for the right to meaningful work and to collectively bargain as principles of natural law. He describes how the Church’s traditional characterization of the human nature and the need for a responsive state parallels and lends support to vulnerability theories core principles and its application in the labor context.

1
A Vulnerability Approach to Private Ordering of Employment

Jonathan W. Fineman¹

This chapter discusses rules of American employment law, including the employment at-will rule and the US’ response to various forms of contingent labor practices. One purpose of the chapter is to demonstrate how vulnerability theory can provide a unique perspective and guiding set of principles for approaching regulation of a complex system. Although this chapter focuses on American law, the principles can be applied to jurisdictions with different specific rules about private ordering. Moreover, it appears that the current trend in many jurisdictions is towards a more American style, at-will approach to employment regulation and increased use of contingent labor (Bredgaard et al., 2010; Countouris et al., 2009). The problems faced by workers in the US may be instructive even in those jurisdictions that have traditionally followed another regulatory path.

I. A comprehensive perspective on the employment relationship

Much has changed in the actual experience of the employment relationship over the last several decades. Katherine Stone (2004) has argued that the old “psychological contract” between employers and employees (loyal service in exchange for lifetime employment) has been largely replaced by a culture in which employees no longer value or respect the same things. The workplace has also been transformed by the decline of unions and the withering away of job security in general (J. Fineman, 2013b). All of this has been accompanied by a rise in contingent labor (Befort, 2002; Stone, 2004). Also important are changes in the economic and societal contexts in which the employment relationship is played out, including globalization, privatization of government functions, rapid and far-reaching technological changes, the 2008 financial crisis, and alterations in basic societal arrangements such as those within the family.

A. The need for a flexible but comprehensive theory of employment

In the face of changes in the workplace, we need a flexible, but robust and comprehensive approach to employment law that is context-specific enough to accommodate adjustments as employment changes over time. Without such a theoretical base, revisions undertaken today will inevitably present yet another set of problems in a few years’ time. Society and the nature of the employment experience inevitably shifts, often in ways that will require yet another recalibration.

The changing nature of the employment relationship suggests the importance of considering the possible impacts of inevitable change on other (symbiotic) societal relationships and institutions. Essentially, a forward-looking, adaptable reassessment of employment law must also anchor the employment relationship in a larger societal context. Employment law establishes the terms of the relationship between employers and employees, but its effects do not stop there. It impacts interests and relationships well beyond those of the employers and employees who are parties to employment contracts. It also affects families, communities, and society at large.

Employment law is relevant to the functioning and wellbeing of societal structures and institutions, such as the family. It also profoundly affects the ability of society to address persistent social problems, such as poverty. Employment laws and the bargains they shape also affect or influence educational policy, thus the opportunities provided for the next generation. Employment has implications for public health and wellbeing, particularly as it shapes governmental responses to child or health care.

We need a theory of employment law that is clear about its objectives, one that would allow policy makers to deal with today’s problems and challenges, as well as the inevitable changes that will surely come. The theory should address not only the objectives to be accomplished, but also the underlying assumptions about the respective interests, obligations, and capacities of the parties to the employment relationship and those third parties (including society) affected by that relationship.

B. The need for an alternative to private ordering

Currently, the primary theoretical understanding of employment in the US is private ordering. The employment relationship is considered a contractual relationship, and in large part it is governed by the same set of rules and principles as any other contract (Story, 1995). As such, the terms of the employment relationship are assumed to be a matter of private, rather than public, concern. The parties are generally free to determine the structure and terms of the agreement.

As discussed in more detail below, policy makers have at various points in time recognized the need to regulate employment contracts. For example, lawmakers passed Title VII of the Civil Rights Act of 1964, prohibiting employers from discriminating on the basis of race, sex, national origin, and religion, based on a public interest in eliminating discrimination (Henson, 2012). However, there is no common theoretical underpinning to the way we understand the public interest in employment contracts. Nor is there an agreed basis for discussing the effects of employment law on the rest of society. Even within a single exception to the at-will rule, such as antidiscrimination law, there appears to be no principled reason why, for example, federal law prohibits discrimination based on gender, but not sexual orientation.

This lack of theoretical coherence about social policy objectives extends beyond the exceptions to the at-will rule to other areas of employment regulation. Laws governing the workplace are passed based on different, often unrelated reasons. For example, the minimum wage and overtime provisions of the Fair Labor Standards Act (FLSA) were originally enacted in order to stimulate the economy during the Great Depression, while workers’ compensation laws were established as a way to limit tort claims brought by injured employees against their employers (Pierce and Dworkin, 1988; Vance, 2002). In addition, innovations based on common law rules, such as implied contract claims and public policy torts, are inconsistently adopted and applied in large part because there is no coherent agreement as to the justifications for or appropriateness of such rules.

The theoretical rationale behind programs such as Social Security, created early in the 20th century and justified by the crisis of the Great Depression, has not been significantly reformulated. There are, however, significant contemporary political challenges to its continuation in conditions perceived very differently from those existing over seventy years ago. The rationale for such historic compromises may not make much sense to today’s politicians and are often inadequate to capture the very different and specific needs of employees and employers (or the state) today.

In sum, we have a patchwork system of rules and exceptions adopted in response to a specific crisis or a particular confluence of interests between stakeholders and the general public. Private ordering continues to govern in the significant space between the patchwork regulations.

II. Private ordering of the employment relationship in the US

Historically, neither the individual states nor the federal government in the US have been as protective of employees as their counterparts in Europe and elsewhere around the world. Instead, the US takes a rather unique approach to employment regulation that positions employers and employees as conceptually autonomous equals, defers to the needs of the marketplace for flexibility and self-regulation, and is suspicious of governmental interference and control. As a result, there are far fewer regulatory protections for US employees than in many parts of the world (Rasnic, 2015).

A vulnerability approach disrupts the American assumption that employment is a private contract between the employer and employee. It allows us to harness the idea that work and production are structured to privilege employers, and this privilege might appropriately be accompanied by some reciprocal responsibility by the employer for addressing the analogous vulnerability of the employee. In addition, because employment law is a system of rights and responsibilities created by the state, the state has an obligation to protect employees’ resiliency, as well as that of employers. The state’s responsibility is based on the fact that law shapes the employment relationship, and the state’s involvement means that the employment relationship should not be considered simply private. In reality, the employment relationship, which is recognized as one of the most complex and important relationships in modern society, constitutes a social arrangement or compact that implicates the obligations of a responsive state to consider the interests of all the stakeholders, including society, when regulating employment through its law.

A. Employment at-will

The at-will rule has been the basic foundation of American employment law since the late nineteenth century (Feinman, 1976). The at-will rule provides that each party to an employment relationship of indefinite term is able to unilaterally terminate the employment without notice at any time for any reason. It positions the employer and employee as equals within a bargaining relationship and is couched in terms of freedom of contract and individual liberty.

The ability of the employer to terminate the employment relationship at any time also means that it may unilaterally change the terms of the relationship for any reason without notice. There may be some specific limitations on the employer’s ability to set the terms and conditions of work provided by measures such as the requirement of a statutory minimum wage. Apart from these specific areas of substantive regulation, however, employers are positioned by the at-will rule to effectively control all of the terms and conditions of employment (J. Fineman, 2013b).

The at-will rule has not been the only principle that governs the employment relationship. Employers and employees can contract around the at-will rule, most commonly by agreeing that employees can only be fired for good cause. Such an agreement can be express or implied-in-fact in many jurisdictions (J. Fineman, 2008). In addition, state and federal legislatures have adopted statutes that limit employers’ discretion in some respects, and the courts have also acted through common law doctrines. The primary exceptions to employers’ right to terminate or take other adverse employment actions are antidiscrimination statutes, public policy claims, and implied-in-fact contract claims (J. Fineman, 2013b).

Importantly, however, these exceptions do not displace the at-will rule. Rather, the exceptions merely identify certain designated unlawful reasons for termination that allow an employee to bring a wrongful termination claim. Unless an employer chooses to contract around the at-will rule or its actions fall within one of the specific exceptions, it is still free to terminate employees for any reason without notice (Estlund, 2002; Schwab, 1993). The exceptions do not change the basic perception of employment as privately ordered. The contract aspect of employment is still emphasized over its social implications.

1. Employment as a private contract

Hundreds of books and law review articles have been devoted to the at-will employment rule (Bird, 2004). While the overwhelming majority of scholars criticize the at-will rule, the criticisms have had little effect. The rule is still widely followed, and may have even gained strength in the last few decades (J. Fineman, 2013b). There is also a vocal minority who defend the at-will rule (Dimatteo et al., 2011; Frantz, 1997; Freed and Polsby, 1989; Harrison, 1984; Larson, 1986; Maitland, 1989; Posner, 1989; Power, 1983). The seminal defense of the at-will rule is the 1984 article by Richard Epstein entitled “In Defense of the Contract at Will.” Professor Epstein argues “the importance of freedom of contract as an end in itself” (p. 953). Employees are perceived as competent enough to understand and enter contracts of their own free will, and it is thus argued that they should be free to enter into at-will employment relationships on equivalent terms with the employer if they so choose. Consistent with the abstract ideal of freedom of contract, Epstein argues that a hypothetical typical employee will “choose” to be employed at-will because they want the reciprocal “benefits” of that arrangement, especially the ability to terminate the employment relationship at any time. Therefore, the prevalence of employment at-will reflects what would be the voluntary complementary choices of both employer and employee.

Epstein also describes what he sees as the objective benefits of employment at-will over the alternative of a just cause rule. Privileging the position of employers, he argues that the at-will rule is necessary to provide employers with the ability to motivate workers and make sure they are productive; the threat of termination prevents employees from taking advantage of employers. Conversely, the ability of employees to quit at any time prevents employers from taking advantage of employees, who would choose to leave if the burdens of employment outweighed the benefits. In addition, the flexibility of the at-will employment relationship is posited to allow both parties to respond to changing conditions and imperfect information.

Epstein asserts that the increased costs and reduced...

Table of contents

• Cover
• Title
• Copyright
• CONTENTS
• List of figures and tables
• Introducing vulnerability
• PART I Law and vulnerability
• PART II Work and social welfare
• PART III Marginalized workers
• PART IV Limits of law
• Combined bibliography
• Index