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In the News: Three Legal Strategies for Low Wage Service Sector Workers

Scrolling through the morning newspapers, I spotted three stories today describing distinct efforts by low wage service sector workers to obtain improved conditions of work through legal mechanisms:

Through Unionization: This story explains that a unionization vote will be held this week of employees of Holt’s at Yorkdale Mall. The tone of the article is amusing–you’d think that the very survival of Holts hinges on the decision of some 170 employees at one store.  Holt’s has 2300 employees, none of who are unionized at this time.  The theory presented is that a vote for the UFCW at Yorkdale will cause a wave of unionization of the other Holt stores. Maybe, but history and experience in collective bargaining in the clothing retail sector would suggest otherwise.  Outside of the grocery sector, there aren’t any union success stories in Canadian retailing of the sort predicted in the article. Looks from the story that a main concern of the workers is the flexible and unpredictable compensation practices in the store, so in collective bargaining, I presume the union would try to bargain a more predictable and less discretionary wage system.  However, Holts will have strong incentive to resist any bargaining demand that would paint the union in a good light to other non-union workers.  So we would expect the union to have a difficult round of bargaining ahead.

Through employment standards legislation:

This story explains how a high end resort in Muskoka has implemented a new rule that 50% of a spa employee’s tips must be handed over to the employer.  The employer then claims it will redistribute the tips to other non-front line staff.  This is the very practice that an NDP private members bill, which apparently has the backing of Premier McGuinty, is intended to stop.

The theory behind the bill is that, when people tip a worker, they do so for good service, and that worker should keep the tips. Tips are part of the regular compensation of many service sector workers, so taking tips from them is like taking part of their wages.  This story made it to the media, I presume, because someone gave it to the media in order to stoke further support for the new law.  So here we see an attempt to use regulatory standards law to protect earnings.

Through class action lawsuits: Finally, the big story yesterday was the decision of the Ontario Court of Appeal certifying class action

lawsuits for unpaid wages and overtime pay at the CIBC and Scotiabank. Here is the Star story about the decisions. The decision of the Court of Appeal in the CIBC can be found here, and the decision in the Scotiabank case here.  I discussed the lower court decision, which tossed the employees’ complaint, back in 2009.

The Court of Appeal found that the CIBC employees’ overtime claims satisfy the test for getting certified as a class action.  Essentially, the Court ruled that there was sufficient evidence filed by both the employees and the CIBC itself to support a finding that there are systemic problems with CIBC’s systems that are contributing to employees working unpaid overtime.  Certainly there was enough evidence of this to meet the test in the Class Proceedings Act, which requires that a case be dismissed only if it is ‘plain and obvious’ that it cannot succeed.  I presume the banks will appeal and drag this on a couple more years, but one day, the actual issue of whether the banks unlawfully refused overtime pay for hundreds of employees may actually get heard.

Should Employees Fight Back and Resist or Just Quit and Move On?

The key theme in all three stories is employee resistance to management HRM and compensation policies.  In all three stories, the employer’s position is that their policies are fair to employees, but the employees have felt so mistreated that they have reached out for outside assistance in a variety of forms.  I hear students and others, especially people who are against unions in particular, say all the time that if workers aren’t happy, they should just quit and stop complaining.  These employees don’t want to quit, and they are trying to address what they perceive to be problems at work in other ways.

Are you in favour of strong legal mechanisms to permit employees to challenge what they perceive as unfair employment practices?

Or should employees who are unhappy be expected to just quit, and find another job?


One Response to In the News: Three Legal Strategies for Low Wage Service Sector Workers

  1. sasha Reply

    July 3, 2012 at 2:13 pm

    The idea that employees ought to just quit if they don’t like their job is, unfortunately, a very powerful argument. Much of its power, of course, comes from the fact that it is often the only argument put forward as well as the fact that it meshes well with societally-vaunted notions of individual freedom.

    Like many things, part of the problem comes from the fact that “you can just get another job” contains a certain amount of truth. There are job openings available in most parts of this country but the question that should be raised is whether employees should have to find another job? This then becomes an issue of power. Who should have a say in how a workplace is run? Should it be a formal dictatorship where employees simply do what they are told, or do we want a society that extends democracy beyond the political arena to where we spend so much of our waking life, the workplace?

    It’s ultimately a question of values and given the socio-economic background of most law students as well as the way these sorts of issues have been framed to them by the media and society in general, I’m not surprised by my classmates’ anti-union animus. It’s disappointing, sure, but the struggle for a most just Canada will not be won in the classroom or the courtroom; it will be won on the streets.

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