Austerity policies, 'precarity' - SAGE Journals - Sage Publications

4 downloads 0 Views 262KB Size Report
in the specific contexts in which austerity has been enacted in Canada and the ... was to cut the fiscal deficit from 8.4% of GDP in 2009 to 0.4% by 2015 – three-.


Austerity policies, ‘precarity’ and the nonprofit workforce: A comparative study of UK and Canada

Journal of Industrial Relations 2016, Vol. 58(4) 455–472 ! Australian Labour and Employment Relations Association (ALERA) 2016 SAGE Publications Ltd, Los Angeles, London, New Delhi, Singapore and Washington DC DOI: 10.1177/0022185616639309

Ian Cunningham University of Strathclyde, UK

Donna Baines University of Sydney, Australia

John Shields Ryerson University, Canada

Wayne Lewchuk McMaster University, Canada

Abstract Drawing on qualitative interview data from case studies in Scotland and Canada in the post 2008 era, this article explores the impact of austerity policies on the conditions and experience of employment in two nonprofit social service agencies and their shifting labour process. Despite differences in context, the article finds a similarity of experience of austerity-compelled precarity at several levels in the agency. This precarity increased management control and evoked little resistance from employees. These findings contribute to our understanding of austerity as articulated differently in different contexts, but experienced similarly at the front lines of care work. Keywords Austerity policies, comparative study, nonprofits, precarity, working conditions

Corresponding author: Ian Cunningham, University of Strathclyde – Human Resource Management, 50 Richmond Street, The Graham Hills Building Glasgow, Glasgow G1 1XU, UK. Email: [email protected]


Journal of Industrial Relations 58(4)

Introduction In the period following the 2008 global financial crisis, governments across the ‘developed’ countries introduced austerity policies and cutbacks to the public sector (McBride, 2014; Peck, 2012). As the costs of recession shifted from the private to public domain through long-term rolling public expenditure cuts in the post 2008 era (O’Reilly et al., 2011), those employed in public services or in outsourced services experienced significant pressure in their working lives. This included the nonprofit social services sector which for several decades has been delivering outsourced public services (Shields et al., 2005). This article explores the impact of austerity policies on the conditions and experience of employment in two nonprofit social service agencies in Canada and the UK. It is concerned with the ways in which austerity is experienced at the front line by employees in the nonprofit social services sector. To do so, the article draws on two theoretical resources. In terms of evaluating its impact, Clarke (2014; see also McBride, 2014; Spitz, 2011) has theorized that rather than a universal project, austerity is articulated in specific ways in particular contexts, resulting in differences in outcomes and impacts. Similarly, Lallement (2011; see also Albo and Evans, 2011) has noted national differences in the impact of austerity policies emerging from differences in labour market adjustment mechanisms, national employment protection regulations, working hours and growing levels of underemployment. This article explores similarities and differences in the experience of front-line nonprofit workers in order to evaluate these theorizations of non-convergence. The changes in employment conditions noted here suggest austerity policies precipitate shifting relations of control between management and workers, bringing greater insecurity and precarity for the labour force. Labour Process Theory, a meso- and micro-level theory analysing changes in workplace dynamics not as benign but as a struggle over power and control, is also used in this article to explore the impact of austerity policies on the experience of front-line work in the nonprofits (Cunningham, 2008; Baines et al., 2014; Thompson and Smith, 2010). Though numerous articles have explored the major tensions in Labour Process Theory in the nonprofit social service sector, namely the shifts in power and control between management and workers (Cunningham, 2008; Baines, 2010; Baines et al., 2014; Charlesworth, 2010; Hall et al., 2005; Martin, 2011; Rubery and Rafferty, 2013), shifts in the labour process under austerity policies remain under researched. The article begins with a brief review of the literature outlining the impact of global recession and austerity policies in the different national contexts of the study. This is followed by an outline of potential workforce implications highlighting a number of areas of emerging precarity from austerity policies in the nonprofit and social service sector (NPSS). After outlining the method, the article analyses data drawn from qualitative studies undertaken in nonprofit organizations in the UK (Scotland) and Canada (one case study in each). The article concludes by commenting on the changing labour process and the articulation of austerity in different contexts. This article suggests strongly similar experiences of austerity

Cunningham et al.


policies at the front line of care service provision within two distinct kinds of services (mental health and immigrant settlement) in two distinct contexts (Scotland and Canada), as well as a similar framework of cutbacks. For the purposes of this article, austerity policies will be understood as a series of measures introduced post-2008 aimed at reducing government deficits and cutting back what was left of the social state (Bach, 2012; Clarke and Newman, 2012; McBride, 2014).

Context National contexts of recession, austerity and the impacts on nonprofits As quoted earlier, Clarke (2014) follows in the footsteps of those who view neoliberalism and New Public Management as partial projects, responding to local conditions, sensibilities and resistance (Bach and Bordogna, 2011; Hood and Peter, 2004; see also Lallement, 2011; McBride, 2014). This theorization of austerity as articulated in specific ways in particular contexts, rather than as a monolithic blanket of predictable impacts and outcomes, is useful to comparative projects such as this article, as it permits the identification of differences and similarities in the specific contexts in which austerity has been enacted in Canada and the UK. Drawing on the voices of workers in the form of qualitative quotes permits this article to draw this macro theorization down to the level of the everyday experience of austerity policies. Contextual differences between Canada and the UK are clear in the respective national experiences of recession. Although technically Canada experienced only two quarters of shallow recession, it is described as having experienced more than a year of stagnation and a recovery that the Governor of the Bank of Canada noted was ‘far from over’ and must be nurtured carefully (Toronto Star, 2013). In contrast, the UK suffered considerably from recession with falls in output deeper than at any time since the 1930s, including five successive decreases in gross domestic product (GDP), followed by a period of stagnation between 2010 and 2012 (Office for National Statistics, 2012). Following each national recession, after a brief period of economic stimulus in both countries, Canada and the UK followed similar paths regarding austerity policies. In Canada, the federal government went into a debt of C$63bn and instructed provincial governments to introduce radical deficit reduction strategies to balance the books by 2015 (The Economist, 2014). This target was achieved, but not without significant cost. Cuts to social funding; wage freezes or roll-backs; cutting sick pay, health benefits and pensions; and job losses in the larger public sector (approximately 26,000) have led to reductions in worker morale, productivity and citizen satisfaction (Cheadle, 2015; May, 2015). In the UK, the Conservative–Liberal Democrat coalition government’s priority was to cut the fiscal deficit from 8.4% of GDP in 2009 to 0.4% by 2015 – threequarters to be achieved through public spending cuts, reducing it from 47.6% to 41% of GDP (Bach, 2012). The Autumn Spending Review of 2010 brought the


Journal of Industrial Relations 58(4)

total value of projected cuts to £81bn (Lowndes and Pratchett, 2012). Scotland played a significant role in the UK’s deficit reduction plan. The devolved administration had to cut spending by around 7% from 2011 and capital expenditure by 40%, generating £3.3bn in savings from 2010 (almost 10% of current spending) (Carrel, 2010). Nonprofit impact. After the global financial crisis, state–nonprofit relations experienced a deepening of insecurity, albeit in a much more protracted and intensive way (Evans and Hussey, 2011; McBride, 2014). In particular, governments and private markets pursued a course of action involving high tolerance for job loss and cuts to wages, pensions and benefits, concomitant with a shrinking public sector and the privatization of individual risk (Albo and Evans, 2011; Peck, 2012; Spitz, 2011). In Canada, austerity policies increased insecurity in nonprofits through low pay, job insecurity, stress, unpaid overtime hours, work intensification, the erosion of discretion, deskilling and casualization through part-time and temporary work (Shields, 2014). In the UK, local authorities had imposed £4.5bn of expenditure cuts on the nonprofit sector by 2012 (Sage, 2012). Research on the impact of austerity measures on the NPSS in the UK remains limited. A recent longitudinal study found that state–provider relationships had become increasingly cost-based and ‘armslength’ as a consequence of austerity (Cunningham and James, 2014). This has been accompanied by downward pressures on staff terms and conditions, which are intensifying because of harsher public expenditure cuts. Representing shifts in labour process or workplace control, social care employers are increasingly converging on an employment model based on low pay and more limited access to sickness, pension and other benefits that is informed strongly by narrow financial logics (Davies, 2011; Rubery and Rafferty, 2013; Taylor, 2013).

The consequences of recession and austerity on nonprofit employment In this article, we use Labour Process Theory (Burawoy, 1985; Kuhn and Wolpe, 2013; Thompson and Smith, 2010) to explore shifting relations of control between management and workers that bring greater insecurity or precarity for the latter in the nonprofit workplace. Our study involves investigating change across a number of dimensions of the employment relationship, in particular, how changes in control may be undermining the standard employment relationship of permanent, fulltime employment and associated benefits such as pensions, sickness and health coverage. In doing so, the article is evaluating the degree to which austerity policies are increasing workplace insecurity or precarity (International Labour Organization, 2012; McGovern et al., 2007; Standing, 2011). Greater precarity and insecurity in work emerges due to technological change, financial reorganizations, greater competition in markets and continuous requests from businesses for flexibility (Kalleberg, 2012; Standing, 2011). The article does

Cunningham et al.


not limit its notion of precarity to the work of Standing (2011), but includes frameworks that identify insecurity as including those working for multiple employers, reliance on personal savings for retirement, not belonging to unions or benefitting from any other form of employee voice, more likely to be exposed to unsafe working conditions (Cappelli, 1999; International Labour Organization, 2012), and more likely to lack control over the labour process due to work intensification (Vosko, 2000). In this article, we argue that both the countries analysed embarked on programmes of austerity policies that involved shrinking public expenditures. Subsequently, funding to nonprofits was increasingly insecure, which, coupled with growing demands for services from under-serviced, vulnerable communities, resulted in a tumbler effect in which precarity operates at multiple levels, amplifying and reinforcing experiences of instability and uncertainty for organizations and the workforce. In light of this, the balance of this article explores the following questions: (1) Did the organizations, workers and services studied experience precarity and insecurity, and if so how? (2) What does this suggest about austerity’s articulation in different contexts? (3) What does this suggest about the shifting labour process or shifts in workplace control between management and workers as exemplified in wages, employment security, hours of work, union representation and so forth?

Method The article utilizes data from two qualitative case studies in Canada and Scotland during roughly the same time period (2014 and 2013). The authors were struck by the similarity of experiences of insecurity, instability and tension within the work itself, the conditions of work and the organizations as a whole in the two distinct jurisdictions. Within the Esping-Andersen (2013) model of comparative welfare states, the two countries share the category of liberal welfare states, with widespread outsourcing of their welfare states to the for-profit and nonprofit sectors. Both jurisdictions experienced different depths of recession and yet both governments responded with significant cuts in funding and austerity policies which compelled precarity in the NPSS. The two agencies provided similar kinds of services to different types of service users (immigrant support in Canada and mental health services in Scotland), with different kinds of workers (namely, new immigrant versus non-immigrant workers) and yet the same strong themes emerged in the open coding of the data in both cases. Both agencies provided services to hard-to-service populations and had a staff of over 100. Services included direct care, case management, counselling, referral, general supports and advocacy. For the purposes of this article, the agencies will be called Canadavol and Scotvol. Table 1 illustrates that in order to create a fulsome portrait of the agencies, semistructured interviews were undertaken with a broad range of actors in each organization, including Chief Executive Officers (CEOs), Human Resources (HR)


Journal of Industrial Relations 58(4)

Table 1. Profile of organizations and interview respondents. Services

Senior managers Line managers Front-line staff Trade union representatives



Advisory services to newcomers

Mental health services

3 3 11 –

4 2 7 1

respondents, senior operational managers, front-line managers/supervisors, frontline care workers (support workers and assistants) and one trade union representative (Scotland). Interviews lasted around an hour and were transcribed verbatim. Data analysis took place through a constant comparison method until themes were identified and patterns discerned (Flick, 2006). After multiple readings of the transcripts, the data were fractured into stories and concepts, and then labelled and sorted (Kirby et al., 2005). This process continued until no new themes emerged. Themes were continually compared to each other in terms of characteristics and dimensions, as well as to similar concepts in the literature, until a mapping of the inter-relationships and patterns was possible. After data had been analysed for each agency, themes were compared across the countries, seeking similarity and contrast in terms of funding relationships, work organization and employment conditions. The findings will be discussed in terms of the strongest themes emerging from the data, including purchaser–provider relations; funding and organizational security; shifts in control from workers to management in Labour Process terms (Ackroyd and Thompson, 1999), in areas such as pay and conditions; impact on employment security; work time; and representative voice.

Findings Purchaser–provider relations and vulnerability to austerity and precarity There was similarity and difference regarding vulnerability to austerity and precarity across the two organizations. Similarities can be seen at the level of the broad thrust of austerity policies and the impact on the agencies studied. In both case studies, austerity policies involved funding cutbacks to underfunded agencies, which produced insecurity and precarity for the agency as a whole. It is well accepted in the literature that this kind of shift from full-time permanent employment with benefits to precarious contracts without benefits represents a decrease in worker control in Labour Process Theory terms and an increase in management control (Lallement, 2011; McGovern et al., 2007; Thompson and Smith, 2010). Both organizations were overwhelmingly dependent on funding from a single,

Cunningham et al.


large public sector funder. These funding conditions led to greater vulnerability to financial shocks from changes in funder priorities and the financial crisis. Following the financial crisis, funding was a permanent source of instability for Canadavol. Almost all interviewees told us that funding precarity thwarted the organization’s ability to plan effectively for the longer term. Their main funder, the government, demanded that workers increase their workload from 500–600 client visits per year/per worker to 800. Continued funding depended on this condition being met. It was the opinion of respondents that these targets were ‘unachievable’, ‘insane’, or in the words of one senior worker, ‘the government is setting us up to fail’. Funding was also inadequate in that it largely failed to cover Canadavol’s infrastructure, management and IT costs. As a senior manager noted, ‘we are always ‘‘borrowing’’ money from other pots to pay for basic overhead’. Government funding restrictions placed considerable restraints on the ability of Canadavol to provide services to many vulnerable individuals and families in the communities. In particular, staff reported that clients were now referred elsewhere for services that used to be offered by the agency and which had been funded by the government. This included counselling and longer-term support. Among senior management, there was a feeling that funding should be diversified to minimize reliance on federal government grants. They had recently hired a ‘business development manager’ whose job was to seek private funding. This search for private funding was not without its costs as most respondents commented that it risked ‘shifting the agency away from its intended goals and vision’ even more strongly than had government funding. Scotvol also had one main local authority funder who, prior to the financial crisis, frequently asked the organization to do more with less through the imposition of annual efficiency savings, resulting in downsizing in its back office, management and administrative functions. Between 2007 and 2012 financial austerity had a significant impact on Scotvol’s sustainability, with management reporting successive funding cuts (on average by 4% p.a.), while still being asked to deliver the same level of services. In the year 2012–2013 further cost savings were imposed. The first imposition was a consequence of the individualization of funding and transfer of personal budgets to individual service users. Scotvol was encouraged by its funder to compete in this newly emerging market where users would choose from a variety of providers, and move their budgets if dissatisfied with their service. If Scotvol accepted the hourly rate tied to individual budgets, the funder would place the organization on its list of approved providers. It was crucial to get on this list in order to ensure organizational survival, as Scotvol would then be recommended to service users. Management respondents reported that the individualized rate was 20% lower than Scotvol’s current rate. The accompanying service-level agreement issued by the funder was described by the Scotvol’s CEO as ‘a zero-hour contract for an organisation’, which contained limited guarantees of hours of work, but expected providers to respond when the newly configured market of users demanded.


Journal of Industrial Relations 58(4)

The CEO reported that these funding changes made it financially expedient for the organization to provide services for people with very high needs. This differed from the organization’s traditional client group who, in many instances, needed at most several hours a week services of supportive counselling and/or group activities. These services were becoming less possible in financial terms, illustrated by a long-standing block contract receiving a cut of 40%, leading to its closure. It was feared that a reduction in lower-intensity services would lead to some clients slipping into greater need as their conditions deteriorated through lack of support, implying a false economy and far greater future cost to society and the public purse. Scotvol was attempting to attract increased funding by adopting a social enterprise model and offering training to other agencies, but this programme was not sufficient to replace the lost income from government contracts.

Workforce implications There was similarity and difference in employment relations dynamics and outcomes from the aforementioned context. Both organizations employed a majority of female workers, but the workers in Canadavol were overwhelmingly from racialized, immigrant backgrounds, many of whom had only recently gained permanent resident status or citizenship. In contrast, workers in Scotvol were almost 100% non-immigrant. In addition, workers in Scotvol had union recognition, though the union found it hard to improve wages or conditions, whereas Canadavol was nonunion, with some workers reporting they wanted a union. The impact of austerity meant that in both cases agencies were left scrambling to stretch existing funding to cover much needed services and overheads, to find alternative sources of funding, and to reorganize their workforce in increasingly precarious ways. In situations where agencies are reorganizing and rationalizing their workforce, in Labour Process Theory terms, management necessarily exerts additional control over the workforce who are not likely to welcome precarious forms of employment or work intensification, and will have to be compelled or enticed to accept the new order (Cunningham and James, 2014; Thompson and Smith, 2010). The overlap of austerity policies and front-line practices can be seen to interact here in ways that underscore and intensify the overall instability of the NPSS. Impact on particular areas of employment is outlined later. Classic Labour Process Theory asserts that as conditions of employment decrease, workers’ immediate power within the workplace also decreases, shifting increased control to management (Ackroyd and Thompson, 1999; Burawoy, 1985). These shifts are analysed in the following.

Pay and conditions The quote below is from a front-line worker at Canadavol. It highlights the insecurity of government funding and, despite the workers’ commitment to the

Cunningham et al.


altruism of the sector, they felt underpaid and disrespected. As one worker expressed: The number of hours we work, the income levels that we’re receiving, inflation rates have increased so much from 2009 to now, especially in gas prices yet our salary stayed the same. Even though we’re not working here for the money, the reality is that there is a life that we have to keep up with outside of it.

Though cuts had been made to training and development in Canadavol in the hopes of having more money to stabilize the agency, employees’ wages, benefits and job security continued to erode, while workload and stress grew. A three-year wage freeze meant wages and salaries had not kept pace with inflation and low wages were often cited as a reason for staff leaving their jobs. In fact, staff turnover was very high and a serious concern for management. Most staff expressed a desire for higher compensation in order to meet their basic needs. Some noted that they could ‘make 30% more at *** down the street’, a unionized agency. Understandably, those without dependents or with another secure household income felt they were better able to cope with the low wages offered by the agency. The CEO told us that if money became available she would use it to bring up those at the lower end of the pay scale, as causal employees were still paid just $10.50 an hour – only 25 cents more than the minimum wage. Interestingly, the agency had recently introduced performance-based pay, a private market model, very uncommon in the NPSS. However, the pay freeze had rendered the performance pay grid moot, as no money was available for any kind of increase. Staff were generally eligible for other benefits if they worked 25 or more hours per week. Eligible staff seemed satisfied; indeed, many were grateful for the benefits, which included modest coverage for dental care, massage therapy, prescription medicine, long-term disability, and accidental death, as well as some contribution for prescription spectacles. Pensions were not part of the package, although after five years the employer was obliged to make a 3% contribution to an employee Retirement Savings Plan. When asked whether they had a pension, one employee responded: ‘I’m not gonna have a big pension either. We don’t have a pension here.’ Staff often felt obliged to use their personal time to complete work tasks (a form of work intensification). This overtime was not paid, but accumulated through a system of time off in lieu. However, workers reported that in order to meet targets and deadlines, they were unable to ever claim this time off. Other sources of intensification included the failure to replace staff who had left the agency and simply redistributing their work tasks to other employees. Staff were also routinely expected to ‘volunteer’ to help with agency events and fundraising. With regard to the latter, respondents reported that ‘volunteering’ was an expectation rather than an option. This intensification of work represents a key aspect of the changing labour process, and though ‘volunteering’ was always an aspect of work in the nonprofit sector, workers agreed it also had intensified since the introduction of austerity policies.


Journal of Industrial Relations 58(4)

Up until 2007, Scotvol had followed public sector negotiated rates of pay. From 2007 onward, however, the organization had been unable to provide a cost of living pay rise, undermining its ability to award increases received by comparable public sector workers. During 2012, as a direct consequence of the funder’s new hourly rate, the organization had to impose an across-the-board 5% pay cut. Austerity policies were also anticipated to result in cuts to sick pay. Work intensification also took the form of increased weekly working hours (from 35 to 37.5 hours), along with cutting one day of annual leave. Decreasing working time and the subsequent decrease in wages put workers in less powerful positions within the labour process of the agencies (Shields, 2014). Despite local differences, overall, the pay and conditions in both these agencies were low and there is little to suggest that they are likely to improve under austerity policies. Though differences exist, the overall impact of austerity policies was to produce workers who were surviving on marginal compensation undertaking increasingly heavy workloads. This intensification of work, with cuts or no increase in wages or hours, represents a basic shift in management–worker control or labour process in which workers are more highly exploited.

Impact on employment security Even among ‘permanent’ employees in Canadavol, the precarity of funding meant that staff had no real job security, including senior management, most of whom were also on time-limited contracts. In addition to the wage freeze, recently a government funding cut translated into a reduction in front-line staff positions. Some of those remaining (school settlement workers), also experienced a cut equivalent to four weeks’ pay and received a four-week layoff. Although management wanted to minimize the impact of these cuts on staff, it was clear that these layoffs were a hardship for all concerned, particularly the financial strain. Management tried to minimize the impact of these unpaid weeks by imposing them in two-week intervals to preserve workers’ benefits and in order to schedule them in the summer and winter when schools were closed. A number of the staff were very upset, in part because staff workloads remained constant despite the reduction in the number of paid weeks of employment, meaning they had to prepare financially for the layoff and cope with the backlog of work upon returning. Failure to meet the quotas assigned to their work could mean a further reduction in funding and additional staffing cuts. The fact that there were two layoffs per year made it more difficult to claim benefits from the Employment Insurance (EI) programme, since claimants could not collect benefits until a twoweek wait period had expired (the length of the first layoff). This meant that workers had to start the claim in the first layoff and then receive only two weeks of benefits after reapplying during the second period of layoff. One affected employee noted that a single, one-month layoff would have made it easier for employees to secure alternative employment. Some staff expressed the opinion that reprisals from management may have occurred if they had exhibited unwillingness to

Cunningham et al.


work additional unpaid hours or criticized any aspect of the agency, including this layoff policy. The layoffs happened at a time of high unemployment in Canada and added to a sense of vulnerability and decreased workplace control. Government cuts resulted in a demand from management for unpaid labour, in the form of the workers themselves and/or volunteers. In either case, these gapfillers were drawn from the newcomer community that Canadavol served (or had served in the case of workers, many of whom used to be service users). Many people were volunteering as a possible pathway into permanent employment; there were over 200 volunteers in Canadavol. As noted earlier, several respondents reported entering employment in the organization through this route. In addition, the organization relied on a regular stream of unpaid students needing to find work study placements. This student labour was unpaid but often fairly skilled, and contributed significantly to under-resourced programmes. We were assured that students and volunteers did not displace workers, though we had no way to confirm this. Likewise, there was always job insecurity within Scotvol as the organization was dependent on the renewal of its contract with the local authority. Managers identified further emerging challenges to occupational status and job security stemming from the financial shocks in the post-2008 era. Cuts from 2007 to 2012 led to the closure of services and redundancies. Jobs were again under threat due to changes in the hourly rate in 2012–2013. The impact of the funding cuts meant there were no longer sufficient resources to fund workers currently employed at senior support worker level. These workers were subsequently re-interviewed for their own jobs and faced redundancy or demotion – the latter involving a pay cut of approximately £4,000. The introduction of across-the-board charges for services and the tightening of eligibility criteria by the funder reportedly led to fear and uncertainty among service users, and doubts over whether they would retain services with the organization. This insecurity among service users fed to further workforce anxiety about job security and an overall decrease in workers’ control over their work lives. Though insecurity can be argued to have existed in both jurisdictions prior to 2008, austerity policies can be seen to generate increased precarity and insecurity in both agencies. The solution in each agency differed somewhat, with the Canadian agency deepening its use of unpaid work from its own staff and from volunteers, and the Scottish agency laying off its own workers and hiring some of them back at significantly lower pay rates. In both cases, anxiety over the future of the agency and employment within it provided management with increased control within the workplace, while these same stressors put workers at a strong disadvantage in terms of bargaining for better hours, terms or pay.

Working time Part-time employment in Canadavol was motivated primarily by funding considerations. The agency would identify work that needed to be undertaken and then tried to generate the scarce resources to pay for it, resulting in employment that was


Journal of Industrial Relations 58(4)

part-time or contractual. While some part-timers claimed they preferred these hours since it allowed them to fulfil family responsibilities, many described difficulties in completing their work in the hours assigned. Most part-time workers reported working full-time hours despite only being paid for part-time. As one worker observed, ‘The trend in nonprofit work is when there are three days a week half time positions, really, you’re doing full time. You’re totally doing a full time job, there’s just no resources for it’. Some part-timers saw part-time employment as a stepping stone to full-time employment, and described their journey from agency volunteer to part-time worker and then hopefully to full-time employee. Finally, in a context where the agency’s client base needed Canadian experience, staff told us they appreciated even part-time employment and short-term contracts. Workers in Scotvol had traditionally enjoyed regular working hours, available on a full-time basis. Recently, because of the uncertain financial position facing the organization and the move to individualized services, management felt that Scotvol could no longer guarantee a standard pattern of full-time hours of work. Management respondents anticipated a future proliferation of different employment contracts, including ‘zero-hours’. Several new recruits were recently employed on variable hours contracts ranging from 5 to 16 hours, with no guarantee of an established geographic location within which they would be working. Many staff also spoke of anxiety and concerns over being required to work more unsocial hours in the face of newly created user-led services. Working time was a significant source of insecurity in both jurisdictions, intensified by the measures employers introduced to cope with austerity-driven cutbacks and new funding formats (such as personalization). In both case studies, workers were deeply concerned about not having sufficient hours of paid work and having to work under more difficult conditions. Interestingly, in Canada some workers were very grateful for the opportunity to work even part-time or volunteer hours. This gratitude was generated by an immigrant labour force with few options, and provided management with extensive control of existing and potential workers.

Representative voice Union representation is generally regarded as one of the main ways via which workers exercise voice and formal control within the workplace (Ackroyd and Thompson, 1999; Kuhn and Wolpe, 2013). The prospects for union resistance or collectivity around precarity were slim for several reasons. This kind of financial insecurity faced by each organization outlined earlier made it increasingly difficult for workers to challenge management, a clear shift in control from workers to management in Labour Process Terms (Kuhn and Wolpe, 2013; Thompson and Smith, 2010). Moreover, managements’ own views on the role of unions could exacerbate problems for unions. Canadavol was non-union, with management expressing ‘unitarist’ views (Kelly, 1998), including: viewing unions as trouble-makers who would disrupt the team and family culture of the organization, introducing an ‘us and them’ relationship with staff; denigrating management’s contribution to improving

Cunningham et al.


working conditions; reducing opportunities to gain flexibility from the workforce; and disrupting service provision. When the HR manager was asked about unionization she retorted: ‘You now have to go outside, turn around three times, and come back in, cos you’ve just cursed us.’ Overall, management felt the organization possessed a transparent and open style of dealing with employment relations issues. Some front-line staff shared management’s negative opinions, and expressed concerns regarding high union dues, protection of those who did not pull their weight and a sense that unions did not understand the nonprofit sector. Others expressed the view that more consultation and negotiation would improve things, especially relating to the aforementioned ‘layoffs’, where they felt they had experienced a ‘take it or leave it approach’ by management. There was also a group of workers who had come from countries where unionization was much stronger, and they felt that there should be efforts to organize. However, we were repeatedly told by front-line workers that there was ‘a culture of fear’ and it was not safe to express opinions openly, to be critical of management or to unionize. Scotvol recognized a union for collective bargaining and a majority of the workforce were members. Yet the union’s possibilities for resistance were limited. Workplace union representatives had called for industrial action in response to pay cuts. The membership rejected this action, with respondents reporting that they ‘had sympathy for the union’, but felt there could be no effective action in the face of external financial pressures that were ‘beyond the control’ of the employer. Regional union officials took up the case of the organization, and campaigned in government circles on Scotvol’s behalf. In addition, the regional union official entered into negotiations with management and the governing board to ameliorate the impact of the austerity cuts. Management described relations with the regional union official as extremely positive and cited their influence in making plans to implement a 1% rise in 2013–2014 as a gesture of good faith to the workforce, though where the money was to come from was unclear. In terms of employee voice, similarities can be seen in responses to the articulation of austerity and in the shift to increased management control. In Canada, which has an overall higher union density than Scotland, workers adopted managements’ perspective that a union would not be helpful. In Scotland, workers adopted the position that there was no point putting pressure on management to improve wages or conditions since the real power lay with government funders. In both cases, the workers are reflecting management’s position and management’s interests, although in both cases, at least some workers wish they had increased voice and power.

Discussion and conclusion The data examined in this article shed light on the question of whether the organizations, workers and services studied experienced precarity and insecurity in the context of austerity policies, and if so, how? Drawing on Clarke’s (2014)


Journal of Industrial Relations 58(4)

conceptualization of austerity as articulated differently in different contexts, we suggested that though national and local austerity policies may differ and impact differently on nonprofit social service agencies serving different populations in different jurisdictions, at the coalface of front-line practice, the experience of austerity policies is a common one unquestionably dominated by insecurity and precarity and changes in workplace control. We drew on Labour Process Theory to identify shifts in management–worker control in the workplace and suggested that precarity necessarily represents an expansion of management power and reduced arena for formal workers’ resistance (such as union action) and worker voice. Although Labour Process Theory tends to argue that there are three parties in the labour process in service work, namely workers, service users and management (Baines et al., 2014; Cunningham, 2008; Thompson and Smith, 2010), this study suggests a fourth party in the form of government funders. For example, the workers’ sense, in the Scottish agency, that management had no control over the level of funding itself (though management clearly did have control in regard to how the funding would be spent) and hence decided not to take collective actions, suggests an additional source of control in these workplaces in the form of government funders. In both case studies, funding had been cut back repeatedly over several years due to austerity policies that showed no sign of easing. This suggests that government funders will continue to play this heavy-handed role of workplace control (and hence the labour process) for some time to come. The analysis presented here shows that workers in outsourced nonprofit social services are vulnerable to austerity policies and increased precarity whether they work in Canada or Scotland, representing a convergence of micro impacts across the two countries, propelled by similarities at the meso level (policies) and a distinct similarity at the macro level of political economy. The cases studied revealed similar trajectories of change in employment conditions and shifts in the labour process falling on an overwhelmingly female workforce – albeit with some differences in emphasis. With regard to pay, for example, the UK’s deeper cuts in public expenditure suggests greater propensity for cuts in income. However, the effect of pay freezes and layoffs saw similar losses in Canadavol. Each group of workers experienced significant shocks with regard to job security, work intensification and working time. In this article, we argue that both the countries analysed displayed elements of precarity within their labour markets, representing a macro convergence, with some differences but with overall similarity in terms of insecurity and growing precarity. Future research could focus on other international comparisons as well as different kinds of precarious workers in the NPSS such as youth and older workers. Moreover, there is similarity with broader trends in both economies with regard to temporary employment (Good News Jobs Summit, 2014), increasing under-employment (Wanrooy et al., 2014) and the recent growth of zero-hour contracts (Adams and Deakin, 2014). This last point suggests the need to broaden investigations into austerity policies and precarity among vulnerable workers to further expand knowledge of different articulations and contexts (Clarke, 2014).

Cunningham et al.


Declaration of conflicting interests The author(s) declared no potential conflicts of interest with respect to the research, authorship and/or publication of this article.

Funding The author(s) received no financial support for the research, authorship and/or publication of this article.

References Ackroyd S and Thompson P (1999) Organizational Misbehaviour. London: SAGE. Adams Z and Deakin S (2014) Re-regulating Zero Hours Contracts. Institute of Employment Rights, Liverpool. Albo G and Evans B (2011) Permanent austerity: The politics of the Canadian exit strategy from fiscal stimulus. Alternative routes: A Journal of Critical Social Research 22: 7–28. Bach S (2012) Shrinking the state or the Big Society? Public service employment relations in an era of austerity. Industrial Relations Journal 43(5): 399–415. Bach S and Bordogna L (2011) Varieties of new public management or alternative models? The reform of public service employment relations in industrialized democracies. International Journal of Human Resource Management 22(11): 2281–2294. Baines D (2010) ‘If we don’t get back to where we were before’: Working in the restructured nonprofit social services. British Journal of Social Work 40(3): 928–945. Baines D, Charlesworth S and Cunningham I (2014) Changing care? Men and managerialism in the nonprofit sector. Journal of Social Work. Epub ahead of print 7 September 2014. DOI: 10.1177/1468017314548149. Burawoy M (1985) The Politics of Production. London: Verso. Cappelli P (1999) The New Deal at Work: Managing the Market Driven Workforce. Harvard: Harvard Business School Press. Carrel S (2010) SNP accused of putting ‘party before nation’ as Scottish draft budget is unveiled. The Guardian, 17 November, p. 10. Charlesworth S (2010) The regulation of paid care workers’ wages and conditions in the nonprofit sector: A Toronto case study. Relations Industrielles/Industrial Relations 65(3): 380–399. Cheadle B (2015) Stephen Harper was briefed on budget cuts and their impact on public service. The Huffington Post, 16 October. Clarke J (2014) Austerity: Articulation and equity. Unpublished conference paper. Austerity conference, McMaster University, Hamilton, Canada. Clarke J and Newman J (2012) The alchemy of austerity. Critical Social Policy 32(3): 299–319. Cunningham I (2008) Employment Relations in the Voluntary Sector. London: Routledge. Cunningham I and James P (2014) Public service outsourcing and its employment implications in an era of austerity: The case of British social care. Competition and Change 18(1): 1–15. Davies S (2011) Outsourcing and the voluntary sector: A review of the evolving policy landscape. In: Cunningham I and James P (eds) Voluntary Organizations and Public Service Delivery. New York: Routledge, pp. 15–36. Esping-Andersen G (2013) The Three Worlds of Welfare Capitalism. London: John Wiley & Sons.


Journal of Industrial Relations 58(4)

Evans B and Hussey I (2011) Introduction: Organizing for austerity. Socialist Studies/Etudes Socialistes 7(1/2): 37–41. Flick U (2006) An Introduction to Qualitative Research, 3rd edn. London: SAGE. Good News Jobs Summit (2014) Good News Job Summit discussion paper. Available at: (accessed 16 October 2015). Hall M, Barr C, Easwaramoorthy S, et al. (2005) The Canadian nonprofit and voluntary sector in comparative perspective. Report. Toronto: Imagine Canada. Hood C and Peter G (2004) The middle ageing of NPM: Into the age of paradox? Journal of Public Administration Research and Theory 14(3): 267–282. International Labour Organization (2012) From Precarious to Decent Work. Geneva, Switzerland: International Labour Organization. Available at: http://www.ilo. org/wcmsp5/groups/public/—ed_dialogue/—actrav/documents/meetingdocument/wcms_ 179787.pdf (accessed 16 October 2015). Kalleberg AL (2012) Book review symposium. The precariat: The new dangerous class. Work, Employment and Society 26(4): 685–686. Kelly J (1998) Mobilization, Collectivism and Long Waves. London: Routledge. Kirby S, Greaves L and Reid C (2005) Experience, Research, Social Change: Methods Beyond the Mainstream. Toronto: Garamond Press. Kuhn A and Wolpe A (2013) Introduction. In: Kuhn A and Wolpe A (eds) Feminism and Materialism: Women and Modes of Production. London: Routledge, pp. 1–10. Lallement M (2011) Europe and the economic crisis: Forms of labour market adjustment and varieties of capitalism. Work, Employment and Society 25(4): 627–641. Lowndes V and Pratchett L (2012) Local governance under the coalition government: Austerity. Local Government Studies 38(1): 21–40. McBride S (2014) In austerity we trust. In: Baines D and McBride S (eds) Orchestrating Austerity: Impacts and Resistance. Halifax, NS: Fernwood. McGovern P, Hill S, Mills C, et al. (2007) Market, Class and Employment. Oxford: Oxford University Press. Martin P (2011) The third sector, user involvement and public service reform: A case study in the co-governance of health service provision. Public Administration 89(3): 909–932. May K (2015) Federal budget likely to squeeze programs (and public servants) even more. National Post, 20 April. Available at: canadian-politics/federal-budget-likely-to-squeeze-programs-and-public-servants-evenmore (accessed 16 October 2015). Office for National Statistics (2012) Real Wages Up 62% on Average Over the Past 25 Years. Newport: Office for National Statistics. Available at: dscp171_286266.pdf (accessed 16 October 2015). O’Reilly J, Lain D, Sheehan M, et al. (2011) Managing uncertainty: The crisis, its consequences and the global workforce. Work, Employment and Society 25(4): 581–595. Peck J (2012) Austerity urbanism: American cities under extreme economy. City 16(6): 626–655. Rubery J and Rafferty A (2013) Women and recession revisited. Work, Employment and Society 27(3): 414–432. Sage D (2012) A challenge to liberalism? The communitarianism of the big society and blue labour. Critical Social Policy 32(3): 365–382.

Cunningham et al.


Shields J (2014) Constructing and ‘liberating’ temporariness in the Canadian nonprofit sector: Neoliberalism and nonprofit service providers. In: Latham R, Preston V and Vosko L (eds) Liberating Temporariness? Migration, Work and Citizenship in an Age of Insecurity. Montreal: McGill-Queen’s University Press, pp. 255–281. Shields J, Evans B and Richmond T (2005) Structuring neoliberal governance: The nonprofit sector, emerging new modes of control and the marketization of service delivery. Policy and Society 24(1): 73–97. Spitz J (2011) Intentioned recession: An ideologically driven re-structuring. New Political Science 33(4): 445–465. Standing G (2011) The Precariat: The New Dangerous Class. London: Bloomsbury. Taylor M (2013) England’s big society: Can the voluntary sector manage without the state? In: Laforest R (ed.) Government–Nonprofit Relations in Times of Recession. Montreal: McGill-Queen’s Press, pp. 79–95. The Economist (2014) Maple Leaf, resting on laurels. Available at: http://www.economist. com/news/americas/21601521-canada-has-not-learned-every-crisis-lesson-maple-restinglaurels (accessed 16 October 2015). Thompson P and Smith C (2010) Working Life: Renewing Labour Process Analysis. London: Palgrave Macmillan. Toronto Star (2013) Bank of Canada: Poloz says Canada still getting over recession. Available at: (accessed 16 October 2015). Vosko L (2000) Temporary Work: The Gendered Rise of a Precarious Employment Relationship. Toronto: Toronto University Press. Wanrooy B, Bewley H, Bryson A, et al. (2014) Employment Relations in the Shadow of Recession: Findings from the 2011 Workplace Employment Relations Survey. Houndmills: Palgrave Macmillan.

Biographical notes Ian Cunningham is Professor of Employment Relations in the Department of Human Resource Management, University of Strathclyde. His research interests include employment relations in the for-nonprofit and for-profit social care sectors, employee absence and disability, and involvement and participation. He has recently published in Public Administration, Gender, Work & Organization, International Journal of Human Resource Management and Competition and Change. Donna Baines holds a Chair in Social Work and Policy Studies at the University of Sydney. She teaches labour studies and anti-oppressive social work. Baines has recently published in Gender, Work and Organization, Studies in Political Economy and Journal of Social Work. Her research focuses on paid and unpaid care work, restructuring in the social services sector, austerity and the shifting terrain of care work and anti-oppressive social work practice. Baines has led several international research projects exploring work and employment in voluntary sector


Journal of Industrial Relations 58(4)

social care services. She is also author of the best-selling (in Canada) edited collection, Doing Anti-Oppressive Practice (Fernwood, 2011). John Shields is a Professor in the Department of Politics and Public Administration at Ryerson University in Toronto, Canada. He is also the Interim Academic Director of the Ryerson Centre for Immigration and Settlement (RCIS). He has recently published Immigrant Experiences in North America: Understanding Settlement and Integration (co-edited with Harald Bauder; Canadian Scholars Press Inc., 2015) and co-edited (with Carlo Fanelli) the themed issue Precarious Work and the Struggle for Living Wages in Alternate Routes: A Journal of Critical Social Research, vol. 27 (2016). Wayne Lewchuk is a founding member of the School of Labour Studies at McMaster University. He is currently LIUNA Enrico Henry Mancinelli Professor in Global Labour Issues in the School of Labour Studies and Department of Economics. In 2011, he completed a project examining the health effects of precarious employment titled Working Without Commitments: Precarious Employment and Health. He is currently the co-director of a fiveyear joint university community research program on Poverty and Employment Precarity in Southern Ontario (PEPSO). This is a joint initiative of the School of Labour Studies at McMaster University and United Way Toronto. The reports from this study can be downloaded at:

Suggest Documents