Wednesday, December 31, 2014

Behind the top down mind

With apologies to Bob Newhart. Who, in the early 1960s, used to do a routine called The African Movie, in which a Hollywood director attempts to get African villagers to cooperate in his latest Stewart-Granger-lost-in-the-Dark-Continent movie (Chief, ...Bwana, ... ... That's what it means? I thought it meant something like 'friend' ....). We thought of that when we read this Wall Street Journal interview with Obama Administration Labor Dept. official David Weil, who seems equally lost in Darkest Industry;
[Weil:] We see it a lot in the area of misclassification [of independent contractors]. The job descriptions and the duties and even the supervision don’t change, but the employer is simply finessing the definition. The implications of that [change in how a worker is categorized] are significant for a working person. Suddenly they lose benefits, access to overtime pay, vacation, and they’re responsible for the expenses related to their job. And the system loses tax revenue, both federal and state.
WSJ: As an academic, you coined the phrase “fissured workplace” to describe how companies are contracting out many aspects of their businesses, from back-office to customer-facing functions. You’re very critical of this shift. Why?
Mr. Weil: There’s nothing inherently wrong with companies finding ways to create flexibility. The capital markets [want companies to be] very focused on core competencies.
But the question of who is responsible for adherence to labor standards gets murkier and murkier. The more levels [of subcontractor firms] there are, the more people are taking a piece of the margins along the way, and the tighter the margins get. As you go lower and lower [down this chain], the bulk of the costs tend to be labor. So if margins are tight and labor is just about the only [flexible expense] you have to play with, that’s where violations are likely to occur.
Weil's operating with an early 20th century industrial mentality ... while it's now the early 21st. In the competitive pressure to produce a saleable product for consumers, employers and workers have to dodge and weave, improvise, around the academics and politicians who just can't realize that they're the problem.

Or, who don't want to admit it, since, as Paul Krugman used to be fond of saying, When your paycheck depends on 'not getting it', you won't.

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