Conference Proceedings

Contract Labor, Contracting Out:
The Implications of New Forms of Work
For Industrial Relations

Toronto, Ontario
December 7 and 8, 1998

United States
National Administrative Office
Bureau of International Labor Affairs
U.S. Department of Labor
200 Constitution Avenue, NW
Room C-4327
Washington, D.C. 20210
(202) 501-6653
(202) 501-6615 fax

Canada
Inter-American Labour Cooperation
Labour Branch
Human Resources Development Canada
Phase II, 8th Floor
165 Hôtel de Ville
Hull, Quebec K1A 0J2
(819) 953-8860
(819) 953-8494 fax

Mexico
Oficina Administrativa Nacional de México
Secretaría del Trabajo y Previsión Social
Av. Periférico Sur 4271
Edificio A Planta Baja
Col. Fuentes del Pedregal, Deleg. Tlalpan
14149 México, D.F.
(525) 645-4218
(525) 645-4471 fax

Secretariat
Commission for Labor Cooperation
One Dallas Centre
350 N. St. Paul, Suite 2424
Dallas, Texas 75201-4240
USA
(214) 754-1100
(214) 754-1199 fax

CONTRACT LABOUR, CONTRACTING OUT:
THE IMPLICATIONS OF NEW FORMS OF WORK
FOR INDUSTRIAL RELATIONS

SUBCONTRATACIÓN Y CONTRATACIÓN EXTERNA:
CONSECUENCIAS DE LAS NUEVAS FORMAS
DE TRABAJO SOBRE LAS RELACIONES LABORALES

ASAP Reporting Services Inc.
275 Slater Street, Suite 900
Ottawa, Ontario K1P 5H9
(613) 564-2727

1 Yonge Street, Suite 1801
Toronto, Ontario M5E 1W7
(416) 861-8720

This volume contains a transcription of presentations from the Conference on Contract Labour, Contracting Out: The Implications of New Forms of Work for Industrial Relations. It is neither a translation nor an edited version of the papers presented.

Ce volume est une transcription des présentations de la conférence sur la sous-traitance, l'impartition : les relations industrielles face aux nouvelles formes de travail. Il ne s'agit ni d'une traduction ni d'une version révisée des communications.

Este volumen es una transcripción de las presentaciónes de la conferencia sobre subcontratación y contratación externa: consecuencias de las nuevas formas de trabajo sobre las relaciones laborales. No es ni una traducción ni una versión editada de las ponencias.

Agenda

Opening Remarks - Day 1

Session 1: Seeking Solutions in an Increasingly Competitive World

International and Domestic Contexts

Legislative Frameworks

What Are the Options?

Question Period

Session 2: Contract Labour / Contracting Out: Assessing the Results to Date

Question Period

Contract Labour / Contracting Out: Assessing the Results to Date (continued)

Question Period

Opening Remarks - Day 2

Session 2: Contract Labour/Contracting Out: Assessing the Results to Date (continued)

Question Period

Business and Labour Panel Discussion

Question Period

Session 3: Contract Labour and Contracting Out in North America

How Does It Work?

Where Is It Headed?

Question Period

Concluding Remarks

Ordre du jour

Mot d'ouverture - première journée

Première séance : La recherche de solutions dans un univers de plus en plus concurrentiel

Contextes nationaux et contexte international

Cadres législatifs

Quelles sont les options?

Période de questions

Deuxième séance : La sous-traitance et l'impartition : évaluation des résultats jusqu'à présent

Période de questions

La sous-traitance et l'impartition : évaluation des résultats jusqu'à présent (suite)

Période de questions

Mot d'ouverture - deuxième journée

Deuxième séance : La sous-traitance et l'impartition : évaluation des résultats jusqu'à présent (suite)

Période de questions

Table ronde des représentants patronaux et syndicaux

Période de questions

Troisième séance : La sous-traitance et l'impartition en Amérique du Nord

Modalités

Et l'avenir?

Période de questions

Clôture

Orden del día

Bienvenida - Primer día

Primera sesión: La búsqueda de soluciones en un mundo cada vez más competitivo

Contexto internacional y nacional

Marco legal

¿Cuáles son las opciones?

Período de preguntas

Segunda sesión: Trabajo en régimen de subcontratación / contratación externa: un análisis de los resultados obtenidos

Período de preguntas

Trabajo en régimen de subcontratación / contratación externa: un análisis de los resultados obtenidos (sigue)

Período de preguntas

Bienvenida - Segundo día

Segunda sesión: Trabajo en régimen de subcontratación / contratación externa: un análisis de los resultados obtenidos (sigue)

Período de preguntas

Comentarios del panel laboral y empresarial

Período de preguntas

Tercera sesión: Trabajo en régimen de subcontratación y contratación externa en América del Norte

¿Cómo funciona?

¿Hacia dónde se dirige?

Período de preguntas

Clausura

Monday, December 7, 1998

9:00 - Opening Remarks

Heads of National Administrative Offices:
Canada - May Morpaw
United States - Irasema Garza
Mexico - Rafael Aranda Vollmer

9:30 - Session 1: Seeking Solutions in an Increasingly Competitive World

Moderator: Serge Brault, Adjudex Inc. (Canada)

International and Domestic Contexts

Canada - Anthony Giles, Université Laval

Legislative Frameworks

United States - Terence J. Hoopes, U.S. Department of Labor
Mexico - Yuri Cinta Dominguez, Advisor to Secretaría del Trabajo y Previsión Social
Canada - Jean Bernier, Université Laval

What are the options?

United States - Sharon Cohany, U.S. Bureau of Labor Statistics
Brent Garren, Union of Needle Trades, Industrial and Textile Employees

12:00 - Lunch

1:30 - Session 2: Contract Labour / Contracting Out: Assessing the Results to Date

Moderator: Frank Roque, Hewitt Associates (United States)

Canada - Rod Hiebert, Telecommunication Workers Union
Canada - Caroll Carle, Noranda
Mexico - Octavio Carvajal Trillo, Carvajal, Bustamante y Trillo Asesores

4:00 - Canada - Jean Gervais, City of Gatineau (Québec)

5:00 - Wrap-up of Day 1

Tuesday, December 8, 1998

9:00 - Session 2: Contract Labour/Contracting Out: Assessing the Results to Date (continued)

Moderator: Caroline Weber, Queen's University (Canada)

United States - Dale Hogg, Iridium World Communications Ltd.
Canada - Rick Blacow, Sensor Technology
Mexico - Roberto Flores Lima, Secretaría del Trabajo y Previsión Social
Canada - Normand Cadieux, Hydro-Québec

11:00 - Business and Labour Panel Discussion

Moderator: Alessandro Rubio Magaña, Secretaría del Trabajo y Previsión Social (Mexico)

Mexico - Octavio Carvajal Trillo, Carvajal, Bustamante y Trillo Asesores
Ramón Gilberto Ramírez Alarcón, Confederación de Trabajadores Mexicanos
Canada - Andrew Finlay, Bank of Nova Scotia
Susan Spratt, Canadian Auto Workers
United States - Don Dowling, Hewitt Associates
Brent Garren, Union of Needle Trades, Industrial and Textile Employees

12:15 - Lunch Hosted by Canada

2:00 - Session 3: Contract Labour and Contracting Out in North America

Moderator: Roberto Flores Lima, Secretaría del Trabajo y Previsión Social (Mexico)

How does it work?

United States - Susan Houseman, The Upjohn Institute
Canada - Rick MacDowell, Ontario Labour Relations Board
Mexico - Jaime Guerrero Romero, Secretaría del Trabajo y Previsión Social

Where is it headed?

United States - Françoise Carré, The Radcliffe Public Policy Institute
Canada - Jean-Yves Brière, Brière Caron
Mexico - Ramón Gilberto Ramírez Alarcón, Confederación de Trabajadores Mexicanos

3:45 - Concluding Remarks
Heads of National Administrative Offices

4:00 - Conference Ends

ORDRE DU JOUR

Le lundi 7 décembre 1998

9 h 00 - Mot d'ouverture

Responsables des Bureaux administratifs nationaux:
Canada - May Morpaw
États-Unis - Irasema Garza
Mexique - Rafael Aranda Vollmer

9 h 30 - Première séance : La recherche de solutions dans un univers de plus en plus concurrentiel

Animateur: Serge Brault, Adjudex Inc. (Canada)

Contextes nationaux et contexte international

Canada - Anthony Giles, Université Laval

Cadres législatifs

États-Unis - Terence J. Hoopes, U.S. Department of Labor
Mexique - Yuri Cinta Dominguez, Conseiller de la Secretaría del Trabajo y Previsión Social
Canada - Jean Bernier, Université Laval

Quelles sont les options?

États-Unis - Sharon Cohany, U.S. Bureau of Labor Statistics
Brent Garren, Union of Needle Trades, Industrial and Textile Employees

12 h 00 - Déjeuner

13 h 30 - Deuxième séance : La sous-traitance et l'impartition: évaluation des résultats jusqu'à présent

Animateur: Frank Roque, Hewitt Associates ( États-Unis )

Canada - Rod Hiebert, Telecommunication Workers Union
Canada - Caroll Carle, Noranda
Mexique - Octavio Carvajal Trillo, Carvajal, Bustamante y Trillo Asesores

16 h 00 - Canada - Jean Gervais, Ville de Gatineau (Québec)

17 h 00 - Fin de la première journée

Le mardi 8 décembre 1998

9 h 00 - Deuxième séance : La sous-traitance et l'impartition : évaluation des résultats jusqu'à présent (suite)

Animatrice: Caroline Weber, Queen's University ( Canada )

États-Unis - Dale Hogg, Iridium World Communications Ltd.
Canada - Rick Blacow, Sensor Techonology
Mexique - Roberto Flores Lima, Secretaría del Trabajo y Previsión Social
Canada - Normand Cadieux, Hydro-Québec

11 h 00 - Table ronde des représentants patronaux et syndicaux

Animateur: Alessandro Rubio Magaña, Secretaría del Trabajo y Previsión Social ( Mexique )

Mexique - Octavio Carvajal Trillo, Carvajal, Bustamante y Trillo Asesores
Ramón Gilberto Ramírez Alarcón,Confederación de Trabajadores Mexicanos
Canada - Andrew Finlay, Banque de la Nouvelle-Écosse
Susan Spratt, Travailleurs canadiens de l'automobile
États-Unis - Don Dowling, Hewitt Associates
Brent Garren, Union of Needle Trades, Industrial and Textile Employees

12 h 15 - Déjeuner offert par le Canada

14 h 00 - Troisième séance : La sous-traitance et l'impartition en Amérique du Nord

Animateur: Roberto Flores Lima, Secretaría del Trabajo y Previsión Social ( Mexique )

Modalités

États-Unis - Susan Houseman, Upjohn Institute
Canada - Rick MacDowell, Ontario Labour Relations Board
Mexique - Jaime Guerrero Romero, Secretaría del Trabajo y Previsión Social

Et l'avenir?

États-Unis - Françoise Carré, The Radcliffe Public Policy Institute
Canada - Jean-Yves Brière, Brière Caron
Mexique - Ramón Gilberto Ramírez Alarcón,Confederación de Trabajadores Mexicanos

15 h 45 - Clôture
Responsables des Bureaux administratifs nationaux

16 h 00 - Fin de la conférence

ORDEN DEL DÍA

Lunes 7 de diciembre de 1998

9 h 00 - Bienvenida

Secretarios de las Oficinas Administrativas Nacionales
Canadá - May Morpaw
Estados Unidos - Irasema Garza
México - Rafael Aranda Vollmer

9 h 30 - Primera sesión: La búsqueda de soluciones en un mundo cada vez más competitivo

Moderador: Serge Brault, Adjudex Inc. (Canadá)

Contexto internacional y nacional

Canadá - Anthony Giles, Université Laval

Marco legal

Estados Unidos - Terence J. Hoopes, U.S. Department of Labor
México - Yuri Cinta Dominguez, Asesora de la Secretaría del Trabajo y Previsión Social
Canadá - Jean Bernier, Université Laval

¿Cuáles son las opciones?

Estados Unidos - Sharon Cohany, U.S. Bureau of Labor Statistics
Brent Garren, Union of Needle Trades, Industrial and Textile Employees

12 h 00 - Almuerzo

13 h 00 - Segunda sesión: Trabajo en régimen de subcontratación / contratación externa: un análisis de los resultados obtenidos

Moderador: Frank Roque, Hewit Associates (Estados Unidos)

Canadá - Rod Hiebert, Telecommunication Workers' Union
Canadá - Caroll Carle, Noranda
México - Octavio Carvajal Trillo, Carvajal, Bustamante y Trillo Asesores

16 h 00 - Canadá - Jean Gervais, Ciudad de Gatineau (Québec)

17 h 00 - Clausura de trabajos

Martes 8 de diciembre de 1998

9 h 00 - Segunda sesión: Trabajo en régimen de subcontratación / contratación externa: un análisis de los resultados obtenidos (sigue)

Moderadora: Caroline Weber, Queen's University (Canadá)

Estados Unidos - Dale Hogg, Iridium World Communications Ltd.
Canadá - Rick Blacow, Sensor Technology
México - Roberto Flores Lima, Secretaría del Trabajo y Previsión Social
Canadá - Normand Cadieux, Hydro-Québec

11 h 00 - Comentarios del panel laboral y empresarial:

Moderador: Alessandro Rubio Magaña, Secretaría del Trabajo y Previsión Social (México)

México - Octavio Carvajal Trillo, Carvajal, Bustamante y Trillo Asesores
Ramón Gilberto Ramírez Alarcón, Confederación de Trabajadores Mexicanos
Canadá - Andrew Finlay, Bank of Nova Scotia
Susan Spratt, Canadian Auto Workers
Estados Unidos - Don Dowling, Hewitt Associates
Brent Garren, Union of Needle Trades, Industrial and Textile Employees

12 h 15 - Almuerzo ofrecido por Canadá

14 h 00 - Tercera sesión: Trabajo en régimen de subcontratación y contratación externa en América del Norte

Moderador: Roberto Flores Lima, Secretaría del Trabajo y Previsión Social (México)

¿Cómo funciona?

Estados Unidos - Susan Houseman, The Upjohn Institute
Canadá - Rick MacDowell, Ontario Labour Relations Board
México - Jaime Guerrero Romero, Secretaría del Trabajo y Previsión Social

¿Hacia dónde se dirige?

Estados Unidos - Françoise Carré, The Radcliffe Public Policy Institute
Canadá - Jean-Yves Brière, Brière Caron
México - Ramón Gilberto Ramírez Alarcón, Confederación de Trabajadores Mexicanos

15 h 45 - Conclusiones
Secretarios de las Oficinas Administrativas Nacionales

16 h 00 - Clausura de la conferencia

--- Upon commencing at 9:05 a.m.

OPENING REMARKS

THE CHAIRPERSON (May Morpaw): Good morning. Bonjour. Buenos días. Bienvenidos a Toronto.

My name is May Morpaw. I will give you a moment to make sure you have interpretation devices and that you have adjusted them. English today is on channel 1, le français sur le canal 2, Español sobre el canal 3. If you have not picked up an interpretation device, they are outside.

Welcome to this conference on contracting out and contract labour in the context of industrial relations.

First let me point out that this is the first time we are holding an event in Toronto since the North American Agreement on Labour Cooperation came into effect in January of 1994. I am delighted to see so many people who have responded to our invitation to this cooperative activity.

Some of us, my team in particular, spent 12 hours getting here yesterday, due to weather conditions in Ottawa and some problems we had along the way. So if things are not as perfectly organized as you would like, that is the reason why and we are doing our best, so please be gentle with us and we will try to make sure everything goes smoothly from now on.

Je suis très heureuse de vous voir participer en si grand nombre à cette activité de coopération organisée ici à Toronto dans le cadre de l'Accord nord-américain de coopération dans le domaine du travail, et pour discuter avec nous, entre trois pays amis, d'un sujet d'actualité en milieu de travail.

I would like to welcome my counterparts, Irasema Garza and Rafael Aranda who will both speak to you in a moment.

I would also like to acknowledge the presence of a number of members of our National Advisory Committee, including Wally Fox-Decent, the Chair of the Canadian Committee.

It is important to note that under the Agreement we have had a continuing program of cooperative activities since 1994. A number of you have participated in some of those. We have been aiming at creating a network of experts across North America on labour matters.

Cette conférence fait partie du programme des activités de coopération pour 1998. Ce programme de coopération est un des piliers de l'Accord. Il vise à faire mieux comprendre les lois, les politiques et les pratiques de chaque pays, ainsi qu'à encourager l'innovation et le partage d'information concernant les questions liées au travail. Évidemment cela comprend l'échange et le dialogue que nous tenons à favoriser ici, aujourd'hui et demain.

This year there has been a conference in each country. We met in April in Mexico to discuss labour market trends, in Washington in October to discuss collective bargaining by multinationals across North America. Today's conference is the fifth one dealing with industrial relation issues since 1994, and the third conference in Canada. We have had one previously in Edmonton, organized with Wendy Hassen from Alberta Labour who is here in the room. We have had one in Montreal, where we worked with the Quebec government in 1996.

Let me take a moment to add that labour ministers of the three countries met for their annual meeting in October. This year, the agenda was devoted to the four-year review of the implementation of the Agreement. You will find Ministers' conclusions in a document outside the room. I encourage you to pick it up and the other documents that you might not have seen before, at the registration desk, including the latest annual report of the Commission for Labour Cooperation.

The point I want to make about the four-year review is that it indicated strong support for this kind of cooperative activity in all three countries and by all respondents to the invitation for public comments. This support for cooperative activities was echoed by ministers who also issued a challenge to participants in our activities. That challenge is to find ways to make cooperative activities and the cooperative work program more relevant, more strategic and more results oriented. We have to count on you to help us do that.

The review highlighted the importance of continuing and building on our current work program, but also to focus our cooperative activities on the emerging workplace issues which we think this particular theme is. New forms of work is certainly an important issue for all of us and one that Canada in particular has been studying for some time, including through a task force that published a report called "The Collective Reflection on the Changing Nature of Work".

Contract work in its various shapes and forms poses some fundamental questions about the social fabric, about workplaces and how they are changing, and specifically, it seems to me, in terms of the balance between individual and collective approaches to employment. Each of our countries may have a different approach to that, and in Canada we may even have different views from region to region of the country, on seeking this balance between individual and collective responsibilities, roles and legislation.

I hope we can use this conference as a springboard for future and more in-depth exploration of complex issues such as this one.

I also want to mention that the interest in the issue, of course, is not limited to our three countries in North America. In October, Labour Ministers of the Americas met in Chile. Minister Lawrence MacAulay from Canada was there, the first time that Canada participated in that Inter-American conference, and this subject was among the topics raised, particularly by the international institutions providing information and reports to ministers.

While in Chile we also met with our Chilean counterparts under the Canada-Chile Agreement on Labour Cooperation to discuss the implications for governments of the evolving workplace. I saw Tony Dean from the Ontario Ministry of Labour come in; he was with us on that delegation to Chile and he may have things to add to the discussion in question period as we go along.

Revenant à notre thème, aujourd'hui et demain nous allons réfléchir sur la question d'une forme particulière de travail, soit la sous-traitance et l'impartition, et ses manifestations dans nos trois pays.

Les différentes perspectives se révèlent dès que l'on tente de définir la question et se poursuivent dans les analyses de la réalité et des répercussions en milieu de travail.

You will be hearing about these various perspectives in what we hope will be a very stimulating two days. Our goal is to increase our shared understanding and to examine the views of business and labour and consider possible public policy directions in response to this reality.

In closing let me say that the new Canadian Minister of Labour, the Honourable Claudette Bradshaw, and our Assistant Deputy Minister and Head of the Federal Mediation and Conciliation Service, Warren Edmondson, extend their very best wishes for a successful conference. Many of you may not have realized, but two weeks ago the Minister of Labour was changed and it is now Madame Bradshaw from Moncton, New Brunswick.

A final word for everyone who is going to be speaking today. These proceedings are being taped and there will be a transcript of the proceedings produced.

J'invite Madame Irasema Garza, Secrétaire du Bureau administratif national des États-Unis, à prononcer quelques mots.

MS IRASEMA GARZA (Secretary, National Administrative Office, United States of America): It is a pleasure to be here with you today in this beautiful City of Toronto, with our friends from Canada and Mexico.

On behalf of the U.S. delegation and Secretary of Labour Alexis Herman, I bring greetings to all of you and best wishes for a successful conference.

I look forward to exploring the topics that we have included in our conference agenda. Contracting out is an issue of growing concern internationally and particularly in the United States where the number of contingent workers continues to grow. This issue generates new opportunities and new challenges for employers, workers and unions. This conference is designed to engage us in a dialogue about these issues and to help us foster solutions that benefit both workers and employers.

The globalization of our economies and the expansion of international trade, facilitated by agreements such as the NAFTA, have created changes that make engaging in international dialogue essential to understand how to best address these issues.

This conference promises to give our three countries that opportunity and I look forward to participating and learning from that exchange over the next two days.

Thank you to my Canadian colleagues for hosting this very important conference. I look forward to chatting with you throughout the next two days. Thank you.

Rafael Aranda Vollmer (Secretary, National Administrative Office, Mexico): En nombre del Secretario del Trabajo de México, José Antoñio González Fernández, tambien les quiero dar la bienvenida y darles las gracias a la oficina de Canadá por este esfuerzo y su hospitalidad para organizar este evento.

La subcontratación está siendo un tema que está adquiriendo cada vez mayor importancia en varios sectores de la economía. Es un tema emergente de la agenda de México. No es un concepto nuevo, sin embargo, es difícil definir con precisión. De ahí la importancia de estos eventos, donde los gobiernos y los sectores sindical y empresarial pueden intercambiar opiniones y dialogar sobre este tema y otros similares. A cada país le espera la tarea de optar conforme a sus instituciones y a su contexto económico, social y jurídico, los instrumentos que le permitan abordar con mayor éxito los retos que estos nuevos esquemas implican.

Muchas gracias.

THE CHAIRPERSON (May Morpaw): Thank you, Rafael.

You have heard a few brief words of welcome from my Mexican and American counterparts, Rafael Aranda and Irasema Garza.

We will step down from the podium and as we formally inaugurate the conference, I will invite the first panel to come forward. It will be moderated by Serge Brault. We will take a few moments to reorganize ourselves.

--- A Short Pause

THE CHAIRPERSON (May Morpaw): We have assembled the panel. Before I introduce the panel moderator, I will take care of a few housekeeping details for you.

Let me begin by saying that what happens at the breaks and in your discussions with each other and in the question period after the presentations is just as important, probably, as what happens here at the front of the room. I encourage you to try to meet everyone and to mingle and to join us at 5:15 p.m. just down the hall, in Confederation Room 3, where Baker and McKenzie will be hosting a cocktail reception. Please join us then and meet our hosts from Baker and McKenzie and meet each other and have a better chance to exchange with new friends.

There are a few errors in the Program. They are minor, so please ignore them and we will correct them as we go along.

The biographies are in the package you received. You can read them as well as I, so we will not spend time looking at them and reading them out from the podium. We will just proceed with the substance of the discussion, with a few words about each speaker where helpful.

Let me remind moderators that their key responsibility is to be ruthless in keeping to the agenda timetables. I would also remind all the participants that you know how long you are speaking, the moderator will remind you of that, but please pace yourself accordingly to allow everyone else the time to speak as well.

Finally in terms of housekeeping, this is an event with simultaneous interpretation. When you are running out of time, please don't speed up. That doesn't help, because it makes it much more difficult to capture the flavour of what you are saying and to ensure it is interpreted. So, make sure we understand everything you are saying.

C'est pour moi un plaisir de vous présenter Monsieur Serge Brault du cabinet Adjudex qui va modérer la première session qui est prévue de 9 h 30 à 10 h 50 quand il y aura une pause.

Mr. Brault was a member of the federal minister of labour's "Collective Reflection on the Changing Workplace", a report that appeared about two years ago. This report was published in 1997, the work was undertaken in the year and a half before that.

In 1997 and 1998, Mr. Brault acted as technical advisor to the Canadian government delegation at the International Labour Organization Conference on Contract Labour in Geneva.

I know that Andrew Finlay, who is also in the room and on the program, was at that conference. I am sure we will hear more about the discussion from there.

Monsieur Brault.

SESSION 1: SEEKING SOLUTIONS IN AN INCREASINGLY COMPETITIVE WORLD

M. SERGE BRAULT (Adjudex Inc., Canada, Modérateur): Merci.

Bonjour, tout le monde, et bienvenue à cette première session ce matin. Étant donné mon rôle de modérateur et pour un peu intimider mes amis qui sont ici avec moi en avant, j'ai décidé de les présenter debout, de manière à ce que lorsque j'interviendrai pour les rappeler à l'ordre ils soient plus dociles et se prêtent plus résolument à mes directives.

Comme vous savez, nous avons un temps qui nous est imparti. Puisque nous parlons d'impartition, nous avons un temps qui nous est imparti ce matin pour traiter d'un sujet qui est fort complexe et varié, suivant comment on le regarde et suivant nos origines et notre histoire à la fois politique et législative.

Nous avons quatre orateurs qui nous feront une présentation à la fois des cadres législatifs qui régissent ou ne régissent pas la question de la sous-traitance et de l'impartition. Nous verrons en même temps les contextes nationaux et internationaux qui encadrent cette notion ou cette réalité qui, en fait, est en progression.

Nous avons à peu près 90 minutes à notre disposition pour traiter de cette question et on essayera de distribuer le temps à peu près également entre chacun des orateurs. On va prévoir une période de questions d'environ 15 minutes où les interventions seront les bienvenues.

As May Morpaw mentioned, I was part of the Canadian delegation at the ILO conference last summer, dealing with contract labour. One of the ironies during that conference is that it actually reached a point of impasse where we could not agree on the notion of contract labour as it was defined in French by the word "sous-traitance". Today we are together to try and address this notion of "sous-traitance" in French, and contracting out or sub-contracting. We are faced with the difficulty of trying to see whether or not we are addressing a common notion or reality when we talk about "sous-traitance" or outsourcing or contracting out or sub-contracting, which is not an easy task.

It is also a notion that is in constant evolution in the sense that new types, new arrangements of work, tend to appear and modify the traditional definition we were used to working with. So one of the challenges facing our panel is to try to see whether or not there is a need for a common notion, if there is a reality, indeed, that is common, under the notion of contracting out, to our different countries and to see whether or not we also have common problems under this general notion.

Let me introduce our panel. With us this morning, first at my far left is Mr. Yuri Cinta Dominguez from Mexico. Mr. Cinta, whom I had the pleasure to work with in Geneva last summer, is an advisor to the Department of Labour in Mexico. Prior to that he was at the University of Mexico where he studied law.

As mentioned in the written notes you have before you, Mr. Cinta, being involved with the ILO Conference on Contract Labour, was able to experience the difficulty facing nations trying to come up with joint definitions or definitions that will indeed suit different countries with different law background, law history.

Our second guest on the panel is Mr. Terence Hoopes from the Department of Labour of the United States. Mr. Hoopes has been with the department for 12 years, mainly involved in employee benefits policies. He is a senior policy analyst at the department, where he specializes in legislative issues, including classification of workers, a topic he will touch on this morning.

Next to him is Professeur Jean Bernier. Le Professeur Bernier enseigne à l'Université Laval depuis 1968 et il est l'auteur de nombreuses publications et communications, dont l'une remarquée qui concerne la grève et les services essentiels, qui a été publiée aux presses de l'Université Laval.

Le Professeur Bernier a participé à un Groupe de travail du Gouvernement du Québec, en 1996, qui s'est penché sur les Articles 45 et 46 du Code du travail du Québec qui sont les dispositions qui régissent la question du transfert d'entreprises, de la vente d'entreprises, de la transmission des droits et obligations en matière de rapports collectifs de travail.

Finalement, sur ma gauche, immédiatement à côté de moi, Tony Giles. Le Professeur Anthony Giles appartient au Département de relations industrielles de l'Université Laval à Québec depuis six ans. Il est originaire de Montréal et avant de venir à Laval il avait enseigné à la Faculté d'administration de l'Université du Nouveau-Brunswick pendant un bon nombre d'années. Il se spécialise dans les études comparatives et internationales. Les recherches et les publications récentes de Monsieur Giles portent sur la mondialisation et son impact sur le travail et l'emploi.

Nul doute qu'avec un panel comme celui-ci nous aurons une discussion animée. En cours de route nous allons improviser un peu. Nous verrons, si vous le voulez bien, à quel moment il est opportun de situer les questions. Je rappelle à mes collègues que je n'ai volé en fait que cinq minutes de leur temps, puisque j'avais profité de la générosité de Madame Morpaw qui m'avait donné quelques minutes du sien.

Si vous le voulez bien, on va commencer tout de suite par la présentation du Professeur Giles. Merci.

PROF. ANTHONY GILES (Laval University, Quebec): Good morning. Bonjour. Buenos días.

For those of you who hate fiddling with the simultaneous translation devices, I am afraid I have some bad news. I am going to be speaking in French for the first part of my presentation and, then, switching to English about halfway through. So now is a good time to get your earphones on if you will need them.

Ma tâche ce matin consiste à situer les pratiques de sous-traitance et d'impartition dans leur contexte plus large. L'argument que je vais avancer est simple.

Dans un premier temps, la sous-traitance et l'impartition sont des stratégies de flexibilisation du travail. Mais elles ne sont pas les seules. Il importe donc de les situer par rapport à la recherche plus générale, par les entreprises, de la flexibilité organisationelle et, plus particulièrement, de la flexibilité du travail.

Dans un deuxième temps, cette quête de la flexibilité s'explique par une restructuration encore plus vaste de la production du travail et de l'emploi. Restructuration qui est liée à la globalisation, la mutation des marchés des produits, les nouvelles technologies, les nouveaux modes d'organisation, la transformation de l'environnement politique et l'affaiblissement du syndicalisme.

Pour développer cet argument je vais commencer par une analyse de la flexibilité du travail. Ensuite je vais examiner les facteurs qui ont poussé, et qui poussent toujours, les organisations à tenter d'assouplir l'organisation du travail. En guise de conclusion, je vais discuter de quelques limites à la flexibilité ainsi qu'à la concurrence elle-même.

Afin de situer la sous-traitance et l'impartition dans le contexte d'une nouvelle forme du travail, c'est utile, et voire incontournable ces jours-ci, de les voir comme les pratiques visant une plus grande flexibilité en milieu de travail. De façon générale, la flexibilité se définit comme la capacité de s'adapter rapidement et efficacement aux changements qui influent sur l'entreprise, que ce soit les changements économiques, technologiques, et cetera. L'intérêt croissant pour la flexibilité touche plusieurs aspects de la gestion des entreprises, mais vu l'objet de ce colloque je vais me limiter à la flexibilité du travail.

La flexibilité du travail se divise en trois types de flexibité plus spécifiques.

D'abord, la flexibilité salariale. C'est la capacité d'ajuster la masse salariale ou les salaires des individus.

Deuxièmement, la flexibilité numérique. C'est la capacité de varier le volume du travail, c'est-à-dire le nombre total des heures de travail.

Et enfin, la flexibilité fonctionnelle qui est la capacité de modifier l'organisation et la localisation du travail.

Pour chacun de ces trois types de flexibilité, il existe ce qu'on appelle une stratégie interne, c'est-à-dire une stratégie qui met l'accent sur la modification des règles et des normes à l'intérieur de l'entreprise en misant surtout sur les employés en place, et une stratégie externe, c'est-à-dire une stratégie qui mise sur les ressources et les marchés à l'extérieur de l'entreprise.

Par exemple, pour une entreprise qui cherche à rendre les salaires plus flexibles, une stratégie externe serait de négocier un système de salaires à double palier, tandis qu'une stratégie interne serait de lier les salaires à la performance de l'entreprise ou des groupes à l'intérieur de l'entreprise, ou même des individus.

Sur le plan de la flexibilité numérique, la stratégie interne consiste à varier les heures de travail des salariés déjà en place par l'horaire flexible, le temps supplémentaire, le travail partagé, par exemple, tandis que la stratégie externe consiste à faire fluctuer le nombre de salariés en utilisant, par exemple, les mises à pied, les rappels, ou encore le travail à contrat, le travail temporaire ou le travail occasionnel.

Enfin, pour ce qui est de la flexibilité fonctionnelle, les mêmes choix s'offrent. D'une part on pourrait chercher plus de flexibilité par la voie de l'externalisation, c'est-à-dire en confiant une partie du travail soit à des sous-traitants, soit à des travailleurs autonomes; ou, d'autre part, on pourrait mettre l'emphase sur la réorganisation interne du travail, notamment par la polyvalence, le travail en équipe, l'élargissement des tâches, et cetera.

Il est donc clair que la sous-traitance et l'impartition sont des pratiques qui cherchent à rendre le travail plus flexible, sur les plans fonctionnel et numérique, par une stratégie axée surtout sur le recours à des ressources extérieures à l'entreprise. De plus, il est évident que ces pratiques, tout comme la grande majorité des pratiques de flexibilité, sont des pratiques « managériales ». Bien sûr, certaines d'entre elles prennent en compte les préoccupations des employés, comme l'horaire flexible, par exemple, ou les avantages sociaux à la carte, mais l'intérêt pour les pratiques flexibles en milieu de travail est essentiellement une préoccupation « managériale ».

La question qui se pose est donc la suivante: qu'est-ce qui explique cette quête de la flexibilité du travail? Avant de vous proposer une réponse, une précision s'impose.

Ce qui me frappe le plus dans le débat sur la flexibilité, c'est le fait que la plupart des pratiques flexibles, et surtout les pratiques associées à la stratégie externe, sont loin d'être nouvelles. Bien que la sous-traitance et l'impartition se présentent souvent commes des innovations, elles reflètent plutôt un revirement, un retour dans le passé, une tentative de démanteler un système de régulation qui a été construit pendant la période de l'après-guerre, du moins dans les pays développés.

Donc, plutôt que de nous satisfaire d'essayer d'expliquer la nouveauté de la chose, il m'apparaît plus pertinent de nous demander pourquoi on fait ainsi marche arrière, du moins pour certaines pratiques flexibles.

I will try to answer this question by looking at six broad sets of factors that have led many firms to seek a competitive advantage to flexibility: globalization, changes in product markets, new technologies, changes in the organization of firms and production systems, changes in the political environment, and the weakening of unions.

How has globalization spurred the search for flexibility? The most obvious reason is heightened international competition resulting from reduced barriers to trade, which has put a premium on finding ways to lower costs, increase productivity and eliminate inefficiencies. Flexibility in its different forms has often been a key part of that response.

But globalization has also meant reducing barriers to foreign investment, which, combined with declining transportation and communication costs over the last 10 years, has made international production systems and, what is particularly important for this conference, international subcontracting networks, much more viable and attractive than they used to be. More generally, the increased international flow of ideas and information that is part of globalization has propagated ideas concerning flexibility. Think, for example, about the spread of quality circles or lean production models. And although each individual country faces its own particular flexibility challenge, the more general global discourse about flexibility is a very powerful factor, particularly within multinational corporations.

Product markets are not just becoming more global, they are also changing in other important ways that have heightened the importance of flexibility.

To begin with, competition has increased not just on international markets, but also on national and local markets. A case in point is the efforts of the Canadian federal and provincial governments to reduce interprovincial trade barriers.

Second, product markets have become characterized by more volatility and uncertainty, leading firms to focus on their capacity to shorten their response to market changes, to position themselves to adapt more quickly.

Third, there has been an increase in demand for quality, both from consumers and also from intermediate users.

Lastly, markets have become more specialized, which has required firms to produce shorter production runs of a wider variety of products for distinct market niches, which also requires them to increase their flexibility.

The third set of factors relate to new technology. Here it is worth mentioning three effects.

First, more rapid technological changes required firms to increase their capacity to adopt and integrate new techniques and processes, to be able to quickly retrain or replace employees with outmoded skills, and to reconfigure the organization of work.

Second, as new technologies increasingly take over standardized and routinized tasks, the nature of work is shifting toward tasks that have a higher intellectual content, that are based more on problem solving and relational skills, which also demands more flexibility.

Third, not only do new technologies require more flexible capacity, they also permit the development of certain forms of flexibility. One example of this is how the combination of computing and communications technologies have allowed the expansion of telework, a form of work that, when it is combined with contract labour, is really just the modern face of the 18th and 19th century "putting out" system.

In addition to new technologies, and in fact perhaps more important than new technologies, are broader trends in the way that firms have sought to reorganize their organizational structures and internal processes. On a general level, downsizing, delayering, re-engineering or thinning the ranks of middle managers and supervisors, forcing responsibility downward, requiring workers and work groups to take on a wider range of tasks.

In the realm of production methods, the introduction of innovations like just-in-time supply systems, the switch from push to pull models of production planning, widespread use of statistical quality control on the shop floor, have all increased the need for greater flexibility.

And lastly, at the level of work organization, team working in its various guises, along with related trends like cellular manufacturing, total quality management, continuous improvement and so on, all create the need and the pre-conditions for more flexible ways of organizing work.

I think the fifth important factor is political and it is the rise of neo-liberalism in the political sphere, a trend that has gone hand in hand, obviously, with the trend toward globalization.

Neo-liberalism, with its emphasis on the superiority of markets and the values of individualism, has played a crucial role in legitimating the pursuit of flexibility, especially in terms of the externally oriented strategy of flexibility.

More tangibly, many governments have taken, or are being pressured to take, steps to deregulate markets to create the conditions for fiercer competition. Moreover, many governments have followed the neo-liberal prescription of making labour markets more flexible, providing yet another important ingredient in the search for flexibility.

And in the public sector, neo-liberalism has played a more direct role, where it has fuelled an obsession with deficit reduction that has translated into financial constraints on public sector managers, forcing them to resort to a variety of flexibility strategies, a case in point obviously being the increased use of contract employees.

Lastly, we should not overlook the general weakening of unions that has occurred over the last two decades, a weakening that is evident in their waning political influence, diminished bargaining power and declining ability to organize new members. All this has made it easier for management to remove what are seen as obstacles to flexibility in collective agreements, like detailed job classifications and other factors that limit the internal mobility of labour. As well, the decline in organizing ability has meant that in the growing sectors of employment, particularly the services, there is an especially pronounced growth of flexible forms of employment that, in turn, makes it even more difficult to organize, a sort of vicious circle for which the only real solution is legislative.

However, given the general decline in labour's political influence, the likelihood of governments acting to help solve this growing crisis of representation is not particularly bright.

To summarize, flexible work practices constitute an important ingredient in the competitive response to a radically different economic, social, technological and political environment. More broadly, the theme that links most of these changes together seems to be a return to market based regulation. Although the attempt to revamp collective agreements, lighten state regulation and so on are sometimes portrayed as deregulation, it is more accurate to see them as a swing of the pendulum away from collective or social regulation toward market regulation or, to come back to a theme I raised earlier, back toward market regulation.

Let me conclude with three points that will serve as caveats to what I have said so far -- because as all academics are trained to do, we have to cover ourselves a little bit -- as well as themes that we might want to pick up in later sessions in this conference.

First, I think it is important that we resist the temptation to exaggerate either the novelty of flexible modes of managing work and labour or the extent of their spread. Obviously flexibility is an important phenomenon and it is widespread, but it is hardly universal. The completely flexible or virtual firm in which employment relations have been reduced to short-term exchanges on something resembling a spot market, is a fiction or very nearly a fiction. Instead, the vast majority of firms, the research shows, have sought to introduce some aspects of flexibility, including sub-contracting and contract labour, without going the whole hog.

Second, we have to be careful not to equate the search for flexibility with the strategy of externalization. This is going to be quite a temptation over the next two days because the key focus of this conference is on sub-contracting, contract labour and outsourcing, methods that are essentially means of externalizing work in an effort to enhance flexibility, reduce costs and offload risks. But we will need to remember, throughout the two days, that externalization is a choice and that other options are available.

Third, these other options are especially important when we consider that an overly enthusiastic search for flexibility can sometimes lead management to try to achieve incompatible goals.

I was in a plant here in southern Ontario recently where an HR department, like so many others these days, was launching all sorts of programs aimed at fostering greater loyalty, commitment, team work and so on. However, at the same time the production managers were turning increasingly to outsourcing, short-term layoffs, contract labour, as a means of achieving their particular goals. So, not surprisingly, the employees found it just a little bit difficult to become enthusiastic about all the talk about partnership and cooperation when their basic job security was being regularly threatened.

This suggests, I would say, that we need to take a close look at the options for becoming more competitive, to measure them carefully against the broader objectives of the firm itself, the needs of employees and the interests of society as a whole. Now that, of course, is the standard way for industrial relations researchers to conclude this kind of discussion, to call for good competitive strategies as opposed to bad competitive strategies. But it is also important, I think, to go one step further and to suggest that a single minded pursuit of competitiveness as such is, as the MIT economist Paul Krugman put it, "a dangerous obsession".

Let me finish up with a very brief quote from the Lisbon group, which I have in French:

"Le problème que pose la compétitivité n'est pas tellement le fait qu'elle existe mais bien plutôt le fait qu'elle prétende s'imposer comme la seule règle potentiellement comprise et respectée par tous. L'obsession de la compétitivité a fait en sorte que celle-ci est en bonne voie d'éliminer du débat public tous les autres principes. Elle ne souffre apparemment aucune concurrence."

Merci. Thank you very much.

M. BRAULT: Je veux d'abord remercier Tony de sa présentation.

Sans plus de délai, I will call upon Terence Hoopes to make his presentation.

I would ask you to put your questions on the back burner for the time being, so as to allow us to hear each presentation before we go to the question period.

MR. TERENCE J. HOOPES (U.S. Department of Labor): Good morning. Bonjour. Buenos días.

I am Terry Hoopes. As Mr. Brault indicated, I work at the Labor Department, but I am a tax attorney by training and I really got into employee benefits through that way.

This issue presents a number of issues that raise some tensions and conflict between the U.S. tax laws and the labour laws on the other hand.

I first came to the issue at the Labor Department when we were working on the contingent work force. As with contracting out, there was widespread confusion over exactly what that meant. To me as a benefits policy attorney, what it really meant was, is there something different about contingent workers or firms that contract out in terms of the benefits that are provided. We find an ageing workforce and an ageing population in the United States. Questions regarding retirement savings and health benefit security have moved from academic discussions into real life examples that mean the difference, in some cases, of life and death for Americans and for others in ageing populations.

What we found was that certain practices resulted in reduced benefits for a number of individuals. We can call them workers, but really, the focus is on individual people. What we were not sure of was whether the reduced benefit frequency was a cause of contracting out or merely an effect of contracting out. We spent some time questioning that, but then we decided it really did not matter, it was the phenomenon of the reduced benefits associated with certain types of workers that raised great public policy concern.

I am speaking today on the legislative framework in the United States regarding contracting out. As Mr. Brault indicated, there are great challenges in definitions here, so I want to try to be clear in terms of where I am coming from and the interest that I have in these issues.

The classification of workers affects their legal entitlements, both under the labour laws and other laws that govern the workforce. It also affects the way businesses and individuals are taxed. Misclassifying workers as employees or not as employees can have serious consequences, not just for the workers and their firms, but also for the government. It is quite a challenge these days for the Department of Labor to come in and determine who a firm's employees are in many instances.

We have also seen a lot of legislative interest in these issues, in terms of classification of workers. We have several different interest groups pushing and pulling in different directions to change the statutory definitions. The status quo, or the definition that we work with now, is equally unsatisfactory to almost all parties. But it is the devil we know. We understand, with all of its drawbacks, what the definition is.

It can be quite confusing having the labour laws and the tax laws use different definitions, as well as having the Congress considering modifications to those definitions. In addition, state laws can also apply in determining who is an employee for purposes of, for example, workers compensation programs.

For example, the growth of temporary firms has raised concerns regarding who the employer is, for accountability purposes, and in some states they have set up a two-tiered system where the firm is initially looked to for primary liability, with the temporary agency standing behind that liability. In other states, they say that both parties are liable for workers compensation responsibilities.

Turning to the topic of contracting out more precisely, the topic of the conference, I want to note that in the United States there is a great degree of freedom in terms of how a business seeks to perform certain functions. The analogy I use in my written material is that if a company needs a certain tangible product, it has a great degree of freedom in choosing whether to manufacture that product or to buy it from an outside supplier. The same is generally true with respect to services or other functions. The primary exception is labour- management relation laws, where we see a union representing a workforce in negotiation with an employer. I will be speaking more on that in a few minutes.

We have seen a trend recently in the United States, for the reasons that Professor Giles mentioned, where more businesses are seeking to focus on their core competencies. They frequently want to focus on business strategies in order to maximize their profits and survive in a more global and more competitive environment. Outsourcing is being seen as a way to implement the strategies, so that outsourcing is used as a tactical method.

The labour-management relation laws in the United States allow employers and unions to negotiate over contracting out. Employers and unions are free to specify that contracting out can be restricted for certain functions, or to place certain numerical limitations on the number of temporary workers to come to a firm, or it can explicitly recognize that an employer is free to contract out.

One of the problems that the labor movement has seen is that when you have workers other than common law employees, it has been difficult to organize those workers. It is conceivable that employees who work for temporary firms may be in greater need of having representation through the unions than other types of workers, but it is difficult to find and communicate with and organize those workers.

A recent case study that we have seen in the United States involves Fedex, the package delivery service. After years of fighting to have representation for the pilots of Fedex, a union was recently recognized and now the company is in the process of attempting to negotiate with the union for the pilots over the first collective bargaining agreement.

The pilots are extremely interested in placing limitations on the firm's ability to contract out the pilot services, especially on, as is described in the press, the coveted overseas routes. However, the company, perhaps with a little bit of a sour taste in its mouth after the unionization fight, has not been too excited about negotiating over these contracting out limitations. In fact, they have not yet been able to reach any sort of collectively bargained agreement on this issue or on other issues. Recently the pilots threatened to strike over this issue. The company's response was you are free to strike if you care to, we are proceeding with our plans to contract out.

Eventually the union returned and conceded that they wanted to bargain for the best agreement that they could receive and that they were not going to strike over this one issue.

What I found very interesting was that as the strike was becoming closer, the pilots, who represented a small portion of the total workforce, had they gone out on strike, would have resulted in the lack of work for the entire firm, all of its employees. The other employees showed up at the headquarters of Fedex to demonstrate in favour of management and they were not particularly sympathetic to the relatively highly paid pilots going out on strike.

The National Labor Relations Act governs mandatory subjects of collective bargaining in the United States. One of the areas where bargaining is mandatory is anything that affects the terms and conditions of employment. Contracting out has been viewed as sometimes affecting the terms and conditions of employment and sometimes not. So depending on the particular circumstances of the case, some of the decisions have come down on both sides of the fence. The standard for determining whether bargaining is required over contracting out is whether the benefits for labour-management relations in the bargaining process outweigh the burden that bargaining would place on the conduct of the business.

Two cases that illustrate the contrast in results that can occur include one where an employer wants to contract out maintenance work that the union workers had been performing traditionally, and there the courts determined that where you are simply replacing the work of the union members with other workers, that does affect the terms and conditions of the work for the affected members of the union. But in a more recent case that is listed in my written materials, in October of 1998 the court decided that a general contractor in a construction business did not have to bargain over every single instance of contracting out, whenever it wanted to, for example, subcontract out the drywall work in a building that it was constructing.

In that situation, the contract actually had language in it regarding contracting out, but it was not a restriction or a recognition that contracting out was explicitly authorized, except to the extent that it said where contracting out was done, which is quite common in the construction business, that the employer was obliged to make sure that the workers of the subcontractor were receiving the same types of wages and benefits as the union members, prevailing wages in effect.

I mentioned the federal tax treatment of employees. We have seen frequently where it is difficult to determine whether an employee-employer relationship exists; this can be quite critical in determining who pays the social security taxes, who is responsible for withholding and depositing income tax amounts, unemployment compensation taxes, and the eligibility to participate in tax favoured pensions and group health plans.

We have seen, as an enforcement agency, that certain employers are quite interested in misclassifying their workers, to call them independent contractors because of the opportunities for cost savings on the cost side, in particular cost savings on the fringe benefit plans. The proliferation of new types of working arrangements with staff leasing and temporary firms and professional employer organizations, have made this determination even more confusing.

The U.S. Treasury Department, which is responsible for collecting taxes in the United States, is concerned that some of these new firms present challenges in their ability to collect taxes. The situation they are concerned about is that if you have a manufacturing firm that goes out of business, there are usually tangible assets that can be attached to satisfy the tax liabilities. If a temporary firm goes out of business, frequently there is nothing left but an empty office that had been rented and some telephones which have been unplugged.

The Workers Compensation Program at the Labor Department had similar concerns. But when they started looking into the actual experience, they determined that the temporary firms in fact were more likely to be current with their tax payments than the small businesses that they tended to service. So while they initially had some concerns, as they looked into it more closely they determined that in fact this could be a positive development.

For tax purposes there is a safe harbour that applies so that if an employer has misclassified its workers as non-employees, there is a way where they can come back into grace without paying heavy penalties.

I would like to contrast that now with the way we do business over at the Labor Department, where it is black and white, one is either an employee or not an employee, and when a firm engages in contracting out, frequently the firm does not view the workers as employees. We view this as a factual determination. We have brought a couple of cases recently. I notice that Business Week has an article in today's issue talking about a couple of our cases. One involved Microsoft, and the other involved Time Warner Incorporated, the publishing firm.

Time Warner was using temporary workers and freelance writers, hundreds if not thousands of these people, and treating them as non-employees. And yet, they showed up to work, they were given assignments, they were assigned deadlines, they worked in offices run by Time Warner. My agency filed a law suit recently, challenging the denial of benefits for those affected workers. With respect to the pension benefits, you can put a dollar sign on the potential damages to the workers. But interestingly, one of the remedies that we are seeking is to enable the employees, as we view them, to retroactively elect whether they would have joined the group health plan or not. I think that it may be somewhat difficult to handle these matters retroactively, but we have proceeded instead.

In the interests of time, I will simply note that my written materials discuss the various laws the Labor Department enforces and interprets, and note that the written material at the end contains a list of factors that apply for the various laws in determining whether someone is or is not an employee entitled to labor protections. Some of these issues certainly arise whenever there is contracting out and unfortunately for all concerned, it is not easy to be certain that you have classified your workers correctly. On the other hand, we do not have a very simple legislative fix to this and expect it to become more and more of an issue with globalization and flexibility demands.

MR. BRAULT: Thank you, Mr. Hoopes, for this very interesting presentation.

Without further ado, I will ask Mr. Cinta to make his own presentation.

You are free to make bets between yourselves as to whether or not all the speakers will respect the time allotted. You may also want to decide whether or not we will be invited over for a drink at the bar if this panel is able to do all it has to do within the time allotted.

Thank you.

YURI CINTA DOMINGUEZ: Buenos días. I am going to speak in Spanish if you don't mind. I will try to make it slowly.

Los procesos de subcontratación del trabajo no son un fenómeno reciente en el mundo. De hecho, ciertas ramas de la economía han estado presentes en las formas de organización del trabajo y de la producción como parte de su funcionalidad.

Resulta importante la discusión de este tema dentro del ámbito internacional, ya que, originalmente, la subcontratación se utilizaba cuando una empresa usuaria carecía de personal especializado para la realización de labores específicas por un corto tiempo. Sin embargo, actualmente, en muchos países se recurre a ella para disponer de un mayor personal, pero evitando la relación directa con todos sus trabajadores y, así, eludir cargas fiscales y de seguridad social.

Haciendo referencia a la legislación laboral mexicana, el fundamento constitucional para la regulación de las relaciones laborales se encuentra plasmado en el artículo 123 de la propia Constitución. Dicho artículo se divide en dos apartados correspondientes a distintas relaciones laborales. El apartado a), que interpretando sus disposiciones, rige de manera general todo contrato de trabajo, incluyendo el trabajo en régimen de subcontratación, y, el apartado b), que rige las relaciones de trabajo entre los poderes de la unión, el gobierno del Distrito Federal y sus trabajadores.

El citado apartado a) del artículo 123 constitucional da origen a la Ley federal del trabajo, legislación que resulta el principal ordenamiento jurídico en México en cuanto a materia laboral se refiere. De este ordenamiento, se pueden desprender las siguientes interpretaciones y conceptos:

El término trabajo se define como toda actividad humana, intelectual o material, independientemente del grado de preparación técnica requerida por cada profesión u oficio.

Por trabajador, se entenderá la persona física que presenta a otra persona física o moral un trabajo personal subordinado.

Por relación de trabajo, se entiende, cualquiera que sea el acto que la origine, la prestación de un trabajo personal subordinado a una persona, mediante el pago de un salario.

Es pertinente señalar que el salario tienes dos características fundamentales. La primera, que es un elemento constitutivo de la relación de trabajo, y la segunda, que es una consecuencia de la prestación del servicio.

Aquí también es importante clarificar los conceptos de personalidad y de subordinado que hace mención la legislación. La naturaleza personal de la prestación del servicio dentro de la relación laboral se refiere a que el trabajador deberá prestar el servicio por sí mismo y no por conducto de otra persona. De lo contrario, dicha relación se podrá interpretar como no laboral. Por su parte, el término subordinado también sirve para diferenciar las relaciones de trabajo de otras prestaciones de servicios que se encuentran reguladas por diferentes ordenamientos jurídicos, distintos al laboral. En México, no toda actividad realizada de una persona para otra, está regida por la legislación laboral, por lo que es necesario diferenciar los caracteres que nos permiten establecer si la prestación de un servicio se encuentra regulada por el marco laboral o por un ámbito del derecho común o privado.

En relación a todo esto, la subordinación debe entenderse, de manera general, como la relación jurídica que se crea entre el trabajador y el patrón en virtud de la cual el trabajador está obligado, dentro de la prestación de sus servicios, a cumplir sus obligaciones bajo las instrucciones dadas por el patrón y, todo esto, para el mejor desarrollo de la empresa.

El término patrón se define como la persona física o moral que utiliza los servicios de uno o varios trabajadores. Aquí debemos destacar el hecho de que si el trabajador, conforme a lo pactado o a la costumbre utiliza los servicios de otros trabajadores, el patrón de éste lo será también de los otros.

Ahora bien, dentro de la legislación laboral mexicana, la figura de la subcontratación no existe como tal, sino que dicho concepto puede equipararse al término intermediación, regulado de manera específica por nuestra legislación laboral. En este sentido, para los efectos de nuestra legislación, el término intermediario se define como a la persona que contrata o interviene en la contratación de otra u otras personas para que presten servicios a un patrón.

Cabe señalar, que los tipos de intermediario regulados en nuestra legislación, se encuentran en tres diferentes artículos. La intermediación es un acto anterior a la formación de la relación de trabajo. Es decir, la intermediación es la actividad de una persona que entra en contacto con otra u otras, para convenir con ellas en que presten sus servicios bajo una relación laboral en una empresa o establecimiento. De esta manera, el intermediario es, ante la empresa o establecimiento que se beneficia con la prestación de los servicios, un gestor o agente que actúa por cuenta de la misma.

Por lo que al intermediario se refiere, se desprenden las siguientes observaciones: El intermediario no se beneficia con el trabajo que se le presta a la persona por la cual está contratando. Los beneficiados con el trabajo contratado por intermediación son responsables frente a las relaciones de trabajo con los trabajadores.

Para que exista la intermediación, es necesaria la relación triangular entre el intermediario, sus trabajadores y la empresa usuaria. Aquí es pertinente aclarar cuales son las relaciones que existen entre estos tres protagonistas del trabajo en régimen de intermediación. El intermediario y sus trabajadores tienen una perfecta relación laboral en la que se presenta un servicio de manera personal, subordinada y mediante el pago de un salario. Por su parte, la empresa usuaria y el intermediario establecen una relación que no se puede considerar laboral, sino que tiene un carácter mercantil. Sin embargo, es importante destacar que, en ella, se presentan elementos de obligatoriedad para ambas empresas respecto de los trabajadores.

Por último, la relación que existe entre los trabajadores del intermediario y la empresa usuaria no puede considerarse tampoco como una relación de trabajo, ya que no se dan los elementos de personalidad y subordinación que, como vimos, son las condiciones necesarias para configurar la relación de trabajo, aún cuando puede llegar a existir una responsabilidad solidaria entre las empresas usuarias y el intermediario.

La legislación laboral establece que se considerarán como patrones y no como intermediarios, las empresas establecidas que contraten trabajos para ejecutarlos con elementos propios suficientes a fin de cumplir con las obligaciones que se deriven de las relaciones con sus trabajadores. En caso contrario, serán solidariamente responsables los beneficiarios directos de las obras o servicios por las obligaciones contraídas con los trabajadores.

En virtud de todo esto, ........ un régimen de intermediación se debe entender la prestación de un trabajo personal subordinado a una persona física o moral que, sin disponer de elementos propios suficientes para cumplir con las obligaciones que deriven de las relaciones con sus trabajadores, ejecuta obras o servicios en forma exclusiva o principal para otra empresa física o moral.

La legislación laboral, al establecer una responsabilidad solidaria entre el intermediario y las personas que se benefician directamente con la prestación del servicio, otorga ciertas situaciones jurídicas que son ventajosas para los trabajadores. Para entender los efectos de la responsabilidad a la que se refiere nuestra legislación, es necesario comprender que el intermediario asume de manera principal las obligaciones que se derivan de la relación con sus trabajadores, por lo que la responsabilidad solidaria que asume la empresa usuaria surge a raíz del incumplimiento por parte del intermediario de dichas obligaciones. Por ejemplo, una empresa conviene con una persona en realizar la construcción de una casa habitación en el régimen de administración de obra. Si la empresa constructora no cumple con las obligaciones contraídas con los trabajadores por no contar con los elementos propios y suficientes para ello, el dueño de la obra será solidariamente responsable de dichas obligaciones laborales. Sobre este punto, los Tribunales han resuelto que, para que la empresa usuaria pueda deslindarse de esta responsabilidad solidaria, tendrá que demostrar la solvencia del intermediario para que entonces éste sea el que cumpla las obligaciones con los trabajadores.

Dentro de las relaciones laborales que se originan por contrato de intermediación, se observa lo siguiente:

Los intermediarios no podrán recibir ninguna retribución o comisión con cargo a los salarios de los trabajadores.

Los trabajadores disfrutarán de condiciones de trabajo proporcionales a las de los trabajadores que prestan sus servicios en la empresa beneficiaria.

De lo anterior, se debe interpretar que cuando el trabajador en régimen de intermediación ejecuta su labor con elementos propios suficientes del patrón, adquiere los mismos derechos que corresponden a los trabajadores subordinados a esta empresa. Sin embargo, cuando es la empresa usuaria quien cuenta con los elementos propios y suficientes, no nos encontramos frente a un trabajo en régimen de intermediación, sino en una perfecta relación laboral.

Quisiera concluir mi intervención diciendo que a pesar de que la legislación laboral mexicana establece claramente cuándo existe una relación de trabajo propiamente dicha y cuándo una relación de intermediación o subcontratación, en esta última persisten ciertas circunstancias que deben ser analizadas con detenimiento. Se hablaba de la flexibilidad que la legislación debe tener en este tema para poder discutir ciertos factores, ciertas circunstancias que se pueden presentar y poder determinar bien quién responde para los trabajadores, quién responde de sus obligaciones. Por todo eso, me parece muy importante la realización de este tipo de foros en los que se puede conocer la experiencia y la aplicación de la legislación de otros países.

Muchas gracias.

M. BRAULT: Merci, Monsieur Cinta.

Sans plus tarder, je passe la parole au Professeur Bernier.

PROF. JEAN BERNIER (Université Laval, Québec, Canada): Bonjour. Good morning. Buenos días.

Pendant que le canon lumière se réchauffe et que la technologie se prépare à se mettre en place, on me permettra de remercier vivement ici Gaston Nadeau du ministère du Travail du Québec pour l'assistance qu'il m'a apportée dans la préparation de la présente communication. En fait, il ne serait que juste que nous co-signions cette communication.

Après avoir entendu nos collègues américain et mexicain qui ont, je pense, largement confirmé les propos que tenait Serge Brault dans son mot d'introduction, à savoir la difficulté de s'entendre sur le concept de sous-traitance, et aussi de la diversité des règles applicables, je crois que ma communication ajoutera à cette diversité.

En fait, toutes les provinces du Canada, de même que le législateur fédéral, ont adopté, à un moment ou l'autre, des dispositions légales qui touchent, directement ou indirectement, la sous-traitance et l'impartition. Ces règles ont toutes pour objectif de protéger ce qui constitue la pierre angulaire du régime de rapports collectifs du travail, à savoir l'accréditation syndicale et la convention collective, en évitant que le transfert total ou partiel d'une entreprise ait pour effet de mettre en danger le droit d'association et la convention collective.

Lorsqu'on considère l'ensemble des législations en vigueur au Canada, on observe qu'en cette matière non seulement les objectifs sont communs, mais il y a aussi une certaine similitude dans les moyens de les atteindre. Néanmoins, on constate également certaines différences non négligeables d'une province à une autre, et plus particulièrement en ce qui concerne le Québec.

En conclusion, je tenterai d'esquisser certaines voies d'avenir, aussi bien en regard des transferts à l'intérieur de la confédération canadienne qu'en se qui touche ce qu'on pourrait appeler le particularisme de la législation québécoise.

Les règles relatives à la sous-traitance et à l'impartition, à défaut d'être toujours formulées explicitement, découlent des dispositions applicables dans les cas de vente, de transfert ou d'autre forme de disposition de l'entreprise. Ces dispositions prévoient généralement que le transfert d'entreprise s'accompagne d'une transmission chez l'acquéreur des droits et obligations résultant de l'accréditation syndicale et de la convention collective liant déjà l'entreprise cédante. En somme, c'est la reconnaissance du rattachement de l'accréditation syndicale et de la convention collective à l'entreprise et non à la personne de l'employeur. De plus, cette protection des droits collectifs est automatique, puisqu'il s'agit de dispositions d'ordre public. Le cas échéant, les parties intéressées n'ont qu'à en faire constater l'application.

Il s'agit en quelque sorte de faire obstacle à la règle civiliste de la relativité des contrats, ou à la règle du « privicy of contract » sous le régime de la « common law », et d'éviter que la vente, le transfert, la cession totale ou partielle de l'entreprise, ait pour effet de rendre caduques l'accréditation syndicale et la convention collective, quelle que soit l'intention réelle poursuivie par l'employeur.

Par ailleurs, en aucun cas les textes de loi n'ont pour objet de limiter le droit de l'employeur de confier des travaux en sous-traitance ou de faire appel à des entreprises extérieures pour venir exécuter chez lui certains travaux. Lorsque de telles limites existent, ou bien lorsque le recours à la sous-traitance est assujetti à certaines conditions, ce n'est pas dans la loi mais plutôt dans les conventions collectives qu'on les trouvera. C'est ainsi, par exemple, que certaines conventions collectives limitent le droit des employeurs de recourir à la sous-traitance en ce qu'elles assujettissent cette pratique à la condition qu'elle n'entraîne aucun licenciement ou aucune mise à pied.

Pour ce qui est de la transmission des droits en tant que tel, dans deux provinces seulement le législateur précise-t-il que les textes visent également la sous-traitance, et encore dans certaines circonstances seulement. Néanmoins, les instances compétentes ont considéré, le plus souvent et de façon constante, que la sous-traitance est une forme de transfert ou de cession partielle de l'entreprise dès lors que l'objet de la sous-traitance peut être considéré comme une entreprise au sens organique du terme.

C'est donc le transfert total ou partiel de l'entreprise elle-même qui donne ouverture à des dispositions pertinentes, et non la forme que peut revêtir ce transfert. Par ailleurs, lorsqu'on estimera qu'il s'agit de sous-traitance simple de main d'oeuvre, on conclura que les règles relatives à la transmission d'entreprise ne s'appliqueront pas puisqu'il n'y a pas sous-traitance d'entreprise mais simplement un transfert de fonctions.

Néanmoins, dans toutes les provinces à l'exception de trois, l'instance compétente a le pouvoir de déclarer, par le biais d'une procédure dite de déclaration d'employeur unique, de déclarer que deux employeurs juridiquement distincts ne font qu'un pour les fins de l'application des lois relatives aux rapports collectifs du travail. Cette déclaration sera prononcée lorsque la commission aura acquis la conviction qu'il s'agit d'une entreprise à double volet, ou bien qu'on est en présence d'une intégration ou d'une communauté de direction suffisante. On peut croire que cette déclaration est susceptible de couvrir un certain nombre de situations qui seraient d'ailleurs apparentées à la sous-traitance de fonctions et qui seraient autrement écartées de la portée des règles protectrices visant les situations de transmission.

L'application de ces règles assure non seulement la transmission de l'accréditation et de la convention collective chez le nouvel employeur ou chez les sous-traitants, mais elle prévoit la continuation de toutes ou de certaines des procédures engagées au moment du transfert, qu'il s'agisse, selon la loi applicable, d'une requête en accréditation, de négociations collectives déjà entamées, de l'arbitrage d'un différend ou d'un grief, ou d'un recours contestant un congédiement en raison de l'exercice d'un droit résultant de la loi.

Bien que similaires à bien des égards, la législation québécoise, de même que l'interprétation qu'en ont faite les tribunaux, comportent certaines caractéristiques qui mettent en lumière le particularisme du cadre juridique applicable au Québec. Pendant de nombreuses années, la jurisprudence du Tribunal du travail s'est montrée partagée entre deux conceptions de la notion d'entreprise, donnant ouverture à l'application des règles régissant la transmission des droits en cas de sous-traitance.

Selon un premier courant de pensée, l'entreprise doit être considérée comme un ensemble de moyens permettant d'atteindre les buts pour lesquels elle a été constituée, ces moyens consistant dans un ensemble d'éléments humains, matériels ou intellectuels. C'est ce qu'on a appelé la conception organique de l'entreprise. Pour les tenants de cette thèse, pour qu'il y ait transfert ou cession partielle d'entreprise, il ne suffit pas qu'il y ait uniquement transfert de fonctions, mais il faut qu'on puisse observer qu'il y a une cession d'une partie de l'entreprise, c'est-à-dire d'un ensemble de moyens. Cette approche, on l'aura noté, est celle qui prévaut ou prédomine dans les provinces anglophones.

Selon un deuxième courant de pensée qui a cours au Québec, l'entreprise est plutôt constitutée d'un ensemble de fonctions dont l'exécution permet de réaliser son objet. C'est ce que l'on a appelé la conception fonctionnelle de l'entreprise. Dès le moment où il y a transfert d'un certain nombre d'opérations ou de tâches vers un sous-traitant, cela suffit pour donner ouverture à l'application des dispositions relatives au maintien de l'accréditation et de la convention collective, dans la mesure évidemment où il s'agit de fonctions couvertes par l'accréditation syndicale.

On comprendra aisément que cette conception fonctionnelle de l'entreprise donne lieu à une application beaucoup plus large des règles protectrices du droit d'association et de négociation, en même temps qu'elle constitue, de ce fait, une contrainte plus grande pour les employeurs.

Cette vision contradictoire de l'entreprise -- conception organique, conception fonctionnelle -- a amené la Cour Suprême du Canada à se pencher sur la question. Dans l'Arrêt Bibeau rendu en 1988, la Cour a statué que la définition de l'entreprise qui doit prévaloir est celle qui correspond à la conception organique de l'entreprise. Toutefois, cette définition organique de l'entreprise n'excluait pas qu'en certaines circonstances le simple transfert de fonctions puisse être considéré comme une cession d'entreprise dans la mesure où l'entreprise en question ne posséderait pas d'autres caractéristiques propres. Il s'agissait là d'une ouverture visant des situations exceptionnelles, mais les tribunaux du Québec n'ont pas tardé à l'emprunter pour en faire une interprétation telle, qu'elle fait de plus en plus place, de nouveau, à la conception fonctionnelle de l'entreprise.

Depuis l'introduction dans la législation des dispositions relatives à la transmission des droits et obligations, la loi québécoise a toujours comporté cette exception dite de la vente en justice. En effet, alors que dans les autres provinces ce n'est pas tant la forme que revêt le transfert qui compte, mais plutôt l'objet du transfert, c'est-à-dire l'entreprise elle-même, le législateur québécois a voulu que l'entreprise qui fait l'objet d'une vente en justice soit, en quelque sorte, libérée de toute obligation résultant de l'accréditation ou de la convention collective en vigueur au moment de la faillite.

De façon générale, le Commissaire du travail au Québec dispose de pouvoirs largement similaires à ceux des Commissions de relations de travail des autres provinces, sauf sur une question qui n'est, du reste, pas négligeable. C'est celle de la déclaration d'employeur unique.

En effet, contrairement à ses homologues des autres provinces ou du fédéral, le Commissaire du travail québécois n'a pas le pouvoir, sauf face à une situation d'osmose totale, de déclarer que peuvent être considérés comme un seul employeur aux fins de l'accréditation et de la négociation collective deux employeurs qui ont des liens organiques suffisamment étroits pour être considérés comme tel. On peut probablement soutenir que ce pouvoir permet aux Commissions des autres juridictions canadiennes de compenser, en quelque sorte, la non-application des dispositions relatives aux droits de suite en cas de sous-traitance déguisée vers un employeur lié.

En conclusion, je vais jeter un regard sur l'avenir en abordant brièvement deux questions.

Dans un état fédéral comme le Canada se pose aussi la question de savoir ce qu'il advient de l'accréditation et de la convention collective liant une entreprise de compétence fédérale qui passe dans le champ d'une province, ou réciproquement. En l'absence de dispositions prévoyant la reconnaissance mutuelle des règles applicables en matière de transmission des droits, ce passage entraîne automatiquement la caducité de l'accréditation et de la convention, à telle enseigne que le syndicat et les salariés ainsi affectés se trouvent contraints de reprendre, a benicio, les procédures en accréditation devant les instances compétentes.

Suite à la recommandation du Groupe de travail chargé de réexaminer le Code canadien du travail en 1996, le législateur fédéral adoptait, en juin 1998, une disposition au Code, dont la mise en vigueur n'a toutefois pas encore fait l'objet d'un décret, mais qui introduit la reconnaissance automatique de l'accréditation émise par une province, ou de la convention collective conclue en vertu des lois d'une province, lors du transfert d'une telle entreprise du champ de compétence provincial vers le champ fédéral. Jusqu'à ce jour, deux provinces seulement prévoient la réciproque.

Quelques perspectives au Québec. Sous la pression du monde municipal, le ministère du Travail du Québec a créé, en 1996, un Groupe de travail chargé d'examiner les dispositions relatives à la transmission des droits en cotisations d'entreprises afin de chercher à les adapter à la situation actuelle. Bien que l'harmonisation de la législation québécoise avec celle des autres provinces du Canada n'était pas le premier but recherché, force est de constater, a priori, que plusieurs des recommandations de ce groupe de travail vont dans le sens d'un rapprochement avec les textes et les pratiques des autres juridictions canadiennes. J'en mentionnerai simplement quelques uns.

D'abord, il est apparu important que le Québec adopte, lui aussi, une règle de réciprocité applicable aux entreprises passant de la compétence fédérale vers celle des lois québécoises.

Deuxièmement, le groupe a recommandé que l'exception de vente en justice soit retirée, car il apparaît que rien ne la justifie, d'autant plus que la faillite paraît avoir, à l'occasion, servi au redémarrage d'une entreprise dorénavant libérée de la présence syndicale et de la convention collective.

Le groupe a aussi recommandé que suite au glissement jurisprudentiel évoqué plus haut, le législateur précise bien que les dispositions relatives à la transmission des droits et obligations ne trouvent pas leur application lorsqu'il s'agit d'une simple concession de fonctions de travail.

Le groupe a aussi recommandé que de façon concommitante à la recommandation précédente, le législateur accorde au Commissaire du travail le pouvoir d'émettre une déclaration d'employeur unique, comme cela existe dans la plupart des autres juridictions au Canada.

En terminant, encore une fois, bien que l'harmonisation des lois du travail avec celles qui sont en vigueur chez nos voisins n'était pas le but premier poursuivi, c'est quand même de façon tout à fait consciente que les auteurs du rapport ont pris en compte l'appartenance du Québec à un espace économique commun. Voici d'ailleurs un extrait de ce qu'ils écrivaient à cet égard -- et je terminerai là-dessus.

"Sans faire de l'uniformisation des règles juridiques applicables dans un espace économique commun un objectif en soi, nous ne pouvons renier le fait qu'une norme juridique est sensée correspondre à une certaine vision de la société. Or la société québécoise, tout en respectant sa spécificité, évolue au sein de l'espace économique nord-américain et participe, à sa manière, à l'évolution de la société nord-américaine, comme cette dernière à la sienne. Voilà qui autorise la prise en compte des règles juridiques élaborées par nos voisins."

Je vous remercie.

M. BRAULT: Merci, Jean.

Rest assured that we will indeed have time for coffee, as planned. One of the tasks that I have as a moderator is to summarize the very interesting presentations that were made, so I will draw some very personal conclusions from the presentations we heard this morning.

First of all, as we can see, the phenomenon itself is not easy to define. We have heard from our presenters that it is a social, political, as well as legal issue, that is indeed raised in all our three jurisdictions.

Je voudrais très brièvement vous rappeler que dans un rapport qui avait été préparé par l'Organisation internationale du travail en 1996, on avait essayé de définir ce qu'on entendait par sous-traitance. La notion avait été décomposée de la façon suivante.

On disait d'abord, c'est le cas d'une entreprise qui embauche des travailleurs pour ses tâches normales par l'entremise d'une autre entreprise qui, elle, conserve certains attributs de l'employeur. Je pense que ça rejoint certains des éléments de la présentation de notre ami mexicain.

Ensuite, il y a le cas d'une entreprise qui embauche des personnes pour ses tâches normales et qui leur donne le statut de travailleurs indépendants travaillant pour leur propre compte. Je pense qu'on voit des éléments ici qui ont été soulignés par Monsieur Hoopes dans sa présentation, où on voit la difficulté de classifier un travailleur, est-il un employé, est-il un entrepreneur indépendant, travaille-t-il pour son compte, travaille-t-il pour autrui.

Le troisième cas, c'était celui d'une entreprise qui passe un contrat avec une autre entreprise pour que celle-ci se charge de la production de biens ou de fournitures de services qu'elle-même assure normalement. On voit ici, encore une fois, la notion traditionnelle de sous-traitance.

Dans son ouvrage, Canadian Labour Law, George Adams nous dit ceci du phénomène:

"Subcontracting or contracting out involves the transfer, by an employer, of work previously done by its own entreprise and its own employees, to an outside contractor."

He also speaks about contracting in:

"... which would be a subset of subcontracting in general, wherein a subcontractor comes into the employer's premises to perform functions, through the employer's specifications, formerly undertaken by the employer's own employees. It is also referred to as 'labour only subcontracting'."

Dans la mesure où il s'agit d'un phénomène qui est passablement répandu, on a vu ce matin, à la présentation de nos orateurs, à la fois que le phénomène est difficile à décrire et que dans la mesure -- et c'est là-dessus que je vais terminer -- dans la mesure où on recourt à la sous-traitance au nom de la flexibilité, on peut présumer que c'est parce que les coûts associés à la sous-traitance, les coûts largement définis, sont des coûts moindres que le recours à la forme traditionnelle d'emploi.

On a vu, dans la présentation de la législation, que les limites -- je pense que c'est ma compréhension de la présentation qui nous a été faite, mais on voit que les législations domestiques de chacun de nos pays ont, en fait, été définies en fonction de la relation traditionnelle employeur-employé, master-servant, ou préposé. Alors que là on assiste à une apparition, à une prolifération de nouvelles formes d'emploi, et de nouvelles formes aussi d'organisation du travail, et qu'en fait la sous-traitance qui nous rassemble aujourd'hui est une manifestation de ces phénomènes et que le recours à la sous-traitance est un phénomène croissant qui n'est pas étranger à la faiblesse relative de la législation en ces matières.

Je vais me contenter de conclure en vous citant un ouvrage canadien, que ceux d'entre nous qui sommes familiers avec l'arbitrage considérons un peu comme notre bible. C'est l'ouvrage de Brown and Beatty intitulé Canadian Labour Arbitration. It is as follows: "in assessing whether or not our labour legislation, as such, has any impact on the recourse to subcontracting or contracting out, a determination that certain tasks fall within the class of work normally performed by employees within the bargaining unit does not imply that the employees have a propriety right to that work. To the contrary,..."

This is probably the most important issue.

"... in the absence of specific language in the collective agreement providing otherwise, it is now universally accepted in Canada that bargaining union work may be subcontracted to non-employees, provided that the subcontracting is genuine and not done in bad faith. And whatever the view may have been in the earlier times, it is now settled that to prohibit subcontracting, the agreement must expressly so provide."

This is obviously in the context of industrial relations, where you have a union organization involved. So given the fact that most of the labour force is not covered by collective agreements, I guess it is fair to say that regardless of how we characterize it, indeed subcontracting is a phenomenon that is basically not covered except in the case where there is a transfer of a business, in the case of Canadian legislation, or Quebec legislation for that matter.

Malheureusement, le temps qui nous est alloué, étant donné qu'il y a une sanction très sévère à le dépasser, est terminé. Ce serait un sacrilège de vous priver du café, alors nous allons faire la pause maintenant et vous pourrez en discuter dans le couloir en prenant un café. On aura sûrement l'occasion d'échanger par la suite.

Merci beaucoup de votre attention. Merci à nos panellistes. Merci bien.

--- Pause

--- Reprise après la pause

M. BRAULT: Mesdames, messieurs, you may want to take your seats.

Our next speakers are both from the United States. Before we turn to their presentation, we have just been allowed to go a little beyond 12:00 if we feel like it. I was told that a number of you had some questions to put to our former panellists and, obviously, to our next panellists, so after their presentation, we will turn to the floor for questions. If indeed the former panellists are still around, I will probably invite them to join us here to take questions from you.

We will break some time around 12:15 p.m. or 12:30 p.m., but rest assured that any time we take beyond 12:00 o'clock we will recover later on, in the sense that we had planned to start at 1:30 p.m. Should we go beyond 12:00 o'clock, we will obviously resume a little later.

Our next speaker is Brent Garren, who is Senior Associate General Counsel of the Union of Needle Trades, Industrial and Textile Employees, otherwise known as UNITE, which has 250,000 members in, mainly the United States, Canada and Puerto Rico. Mr. Garren represented the AFL-CIO at the ILO's International Labour Conference for the past four years, sitting on the technical committees concerned with the protection of homeworkers and with contracts, labour.

We did, in the past, indeed find time to have a few drinks together in Geneva and I know that he will have a lot to say on our next topic.

Brent, the floor is yours.

MR. BRENT GARREN (Senior Associate General Council, Union of Needle Trades, Industrial and Textile Employees, United States of America): Good morning.

I would like to thank the organizers of this conference for this opportunity to address you all. I, like you, am looking forward to the whole proceeding, today and tomorrow. I think it will be very useful.

What I am going to speak on is not, perhaps, exactly what the title in the program is. Basically I want to explain the union's point of view on the two issues of contracting out and the use of independent contractors in place of employees. Those are the two subjects I want to deal with: contracting out, and the use of independent contractors.

Concerning contracting out, I would draw the following distinction. I believe there are legitimate reasons for contracting out, and illegitimate reasons. The legitimate reasons go to adaptation to change, flexibility, as Professor Giles explained it, in terms of increased efficiency or involving the use of either employees, either workers or management, with specialized knowledge, specialized tools, where you are bringing some specialized input into the process. There, you have contracting out that increases productivity, increases efficiency. That is perfectly legitimate and as a unionist discussing social policy, we have no objection to that.

As a footnote or a parenthetical, let me add that in particular collective bargaining situations where particular groups of workers we represent may lose their jobs, that represents a problem that we have to deal with. But right now, I want to speak more in terms of social policy, and that kind of legitimate contracting out is something that we have no problem with.

What we have an enormous problem with is contracting out that is used to avoid unions, avoid collective bargaining agreements, lower wages, and eliminate health and other benefits. The elimination of health benefits, as Terry Hoopes discussed a little bit on an earlier panel, is, I think, a particular problem in the United States, where we have no national health care system and health care is largely delivered through private employers and, in particular, through union contracts.

The essential response of the labor movement, I believe, to the idea of contracting out, or certainly the response of UNITE, my union, is to stress the responsibility for the user enterprise, the enterprise that is contracting out the work, sending the work out to the enterprise that will actually perform the work -- in ILO terminology, the entity that sends out the work is called the user enterprise. The essential point is to make the user enterprise responsible contractually, legally, and morally, for the conditions of the employees in the contracting shops. And to the extent we have full responsibility for the user enterprise, that will both eliminate or minimize illegitimate contracting out, while allowing contracting out for legitimate efficiency purposes.

Let me speak a little bit about the history of contracting out, particularly in the women's garment industry in the United States. That is what I am most familiar with. Contracting out is a 70-year-old phenomenon in women's garments. In the 1920s in New York, when the cloak and suit industry and skirt and women's garment industry employed hundreds of thousands of workers, my predecessor union, through a series of general strikes in New York, was able to organize the garment industry and put a floor under the wage and working conditions that were terrible, truly sweatshop conditions. Shortly, within a few years after achieving union contracts with decent conditions, 75 per cent of the employers in the cloak and suit industry shut down their inside shops, fired their workers, stopped producing garments and, instead, turned to contractors.

This shift from inside production to contracting production did not bring in any specialized equipment, did not bring in any specialized knowledge, did not introduce any efficiency. It had one purpose, and one purpose only, which was to avoid the union contract and have the manufacturers avoid all responsibility for conditions in the contracting shops. What the manufacturers were able to do was play one contractor off against another, because contractors in the garment industry, it is extremely little capital, it is basically the provision of workers, of the labour, that is all that is involved in contracting. The contractor himself has, as I say, extremely little capital. It takes less capital to start a garment shop in New York city today than it does to own a taxi cab. All that contractor does is act as a glorified foreman for the manufacturer, but dressed up as an independent businessperson.

There are roughly 20,000 contracting shops in the United States today, just as there were, in terms of similar numbers, in the twenties. The manufacturers can play one contractor against another, induce an auction block system, a bidding war system, in which the contractors compete against each other for the work, basically one point of competition, how far they can drive down wages and labour costs.

That system, that we had in the twenties, has not basically changed. Through union contracts and otherwise, some of the horrors of it has been controlled, but to this day, 85 per cent to 90 per cent of garment production, particularly, again, women's garments, garments that are subject to fashion, are contracted out. Today we have the giant branded manufacturers, like Nike, like Reebok, the giant retailers, like Federated, like the Gap, like the Limited, responsible for the production of billions of dollars worth of clothing, making hundreds of millions, if not billions, of dollars in profits and having their production carried out today in the City of New York, in Miami, in Los Angeles, in tiny little contracting shops where the violation of minimum wage is rampant. Two-thirds of the contracting shops in the garment industry in the United States do not pay minimum wage. Roughly two-thirds or more do not pay overtime. There is virtually no enforcement of occupational safety and health. For thousands and thousands of these workers, hundreds of thousands, really, no taxes are collected. They operate in a black market.

And you have the ludicrous situation, where somebody can be making a pair of pants for Wal-Mart and their contractor goes out of business owing them 10 weeks worth of wages, and that worker cannot collect the unpaid wages, ultimately, for a product that is being designed and controlled by Wal-Mart and sold by Wal-Mart and the profit goes to Wal-Mart, but because this worker works for a 20-person contracting shop in Chinatown in Manhattan, they cannot collect their back wages.

This is something that happens -- millions of dollars of back wages are lost by garment workers in the United States annually. There are millions of dollars that are recovered by the Department of Labor, by the union and others working with the Department of Labor. That is a small portion of the wages that are lost because of a contracting out system. Of course workers would be able, ultimately, to recover if Wal-Mart were their employer, if Liz Claiborne were their employer, if Nike were their employer; but because they are employed in contracting shops, they suffer the conditions they do.

As I said, the basic response of UNITE to contracting out in the women's garment industry -- and, we believe, an appropriate response in general -- is the notion of responsibility for the user enterprise. In our contracts or private collective bargaining agreements in the garment industry, we have contracts with some of the producers, what we call jobbers in the garment industry, such as Liz Claiborne, Calvin Klein, Ralph Lauren, and these contracts require them to put their work only in union shops, not to use non-union contracting shops, and require them to pay directly for employee benefits, such as pension and health care and vacation, and require them to guarantee the wages in the contracting shops so that if the contractor defaults on the wages, then we can go directly against a Liz Claiborne for unpaid wages.

So to the extent that we are able to unionize and maintain unionization of the Claibornes and the Ralph Laurens, we can impose this kind of responsibility. But unfortunately, it is now a small sector of the garment industry that is under those kind of contracts, so we are engaged in a variety of other attempts to make the retailers and branded label manufacturers responsible. A major element of that is a campaign of public opinion involving demonstrations, exposés, when we find, for instance, unpaid wages, which we did with Wal-Mart, people making Wal-Mart clothing in New York. When they could not collect their wages, we had a series of demonstrations, press conferences and so on, to put the spotlight on Wal-Mart, to reclaim the back wages.

Various efforts towards corporate codes of conduct, some of which are sponsored by the White House. The Apparel Industry Partnership is one of those. The ILO is dealing with corporate codes of conduct. This is another avenue to try to establish responsibility for the retailers and branded label manufacturers.

The third thing we are doing is legislative, which, frankly at this point, given the political situation, we are unlikely to achieve any time soon on the national level. The essence of the legislation we are seeking, the two things I want to point to, one, there is a Bill in Congress, called the Stop Sweatshop Act, which would make the garment industry retailers and manufacturers responsible for violations of the Minimum Wage and Overtime Act, so that workers who now only have a legal remedy against the fly-by-night contractors who go in and out of business and very often do not have the resources to pay when they are found to have violated the Fair Labour Standards Act -- that is the federal minimum wage and overtime act -- this legislation would now mean that the workers would have a right to collect their unpaid wages and unpaid overtime from the Wal-Marts and Macy's and the Gap and so on, who directed the operation that they worked on.

The second thing I want to point to is that we have a provision in our labour law, specifically for the garment industry, that exempts garment industry manufacturers and contractors from secondary boycott laws. Secondary boycott laws -- I hope people are familiar with them, I do not really have the time to go into it -- are an incredible impediment when workers in a contracting shop want to exercise economic power to engage in collective bargaining. Secondary boycott laws often prevent them from using their economic power against the firms, the user enterprises that actually control their conditions, their flow of work. The prices set by the user enterprises sets a ceiling on the wages and benefits that workers in the contracting shops can get. The secondary boycott and anti-trust laws are government regulation at their worst. They are regulation aimed specifically at preventing -- or perhaps aimed is not right, but have the result specifically of preventing workers from exercising their economic power against the decision-makers who control their standards.

Let me speak very briefly on the question of independent contractors and the misclassification of employees as independent contractors.

I used to drive a cab in the City of Chicago. I worked for Yellow Cab. I would go in and I would get 45 per cent of the metre. It was essentially a piece rate system. The more I put on the metre, the higher my percentage, the more I would get back. One day I went in to work and I was told that I now was not an employee, I had to pay the company to lease the cab, I had to pay the company for gas, and what was left over, I could keep as my profits. Absolutely nothing changed in the way in which I did my work. I had no more control over the business, no more risk of profit and loss, no more anything than I did the day before, but now, if I spoke to the driver next to me and said we ought to get together and do something to get a higher percentage on the metre, I would be violating the anti-trust law and I would be subject to trouble damages.

That is the situation that millions of workers face. There are cleaning contractors. There is a case in Seattle, where the company that does the cleaning -- again, you are talking about multimillion dollar real estate companies that get the cleaning contracted out. They took each floor of the building and charged people. They said come and be a business person, buy the lease, buy the option, the right to clean this floor of the building. And those people who had been, in the past, or trying to be represented by SEIU, Service Employees International, immigrant women making essentially minimum wage or less, all of a sudden became independent businesspeople, were denied the right to a union, denied minimum wage, denied all the protection of labour law.

That is the reality we face. I just want to say, in terms of that, it is essential that labour law look at the economic reality of subordination. If the person performing the work is under subordinate circumstances to the person providing the work, that is an employee and that person deserves the protection of labor law.

Thank you.

MR. BRAULT: Thank you, Brent.

Our next speaker is Sharon Cohany, who is an economist in the office of employment and unemployment statistics of the U.S. Bureau of Labor Statistics. She has extensive experience with the BLS new measures of contingent and alternative employment arrangements, helping to develop concepts in questionnaires, in authoring articles in the Monthly Labor Review.

Given the difficulty we have trying to define the notions we are trying to address here, I am sure that Sharon's presentation will be of great interest.

Thank you.

MS SHARON COHANY (U.S. Bureau of Labor Statistics): I want to thank you for giving me the opportunity to speak on BLS research in the area of alternative employment arrangements.

First, BLS, for those of you who may not know, is a major statistical agency of the U.S. government, responsible for a number of programs that measure the well-being of the American worker. BLS is a data gathering and disseminating agency and not a policy agency, although our data, of course, are used extensively to craft and to evaluate a variety of policies.

In recent years in the United States, there has been considerable concern over job quality. There has been a perception of growth in non standard employment arrangements, a perception of increasing temporary work, of intermediated employment, of a weakening of the ties between worker and employer, terms such as "disposable worker" or "just-in-time workers" gain currency. There is a lot of discussion of these issues and some attempts to measure it, but very little hard data.

BLS saw a very definite need to step into this area and provide some conceptual framework and some information. We began doing the conceptual work, in the late nineteen eighties, for both contingent and alternative work arrangements. We received funding for a first survey in February 1995.

This survey was conducted as a supplement to the Current Population Survey which is our monthly survey of some 50,000 households that is the primary source of information on the labour force. We identified four alternative work arrangements that we were particularly interested in. I should say, as other speakers have said, that these are not necessarily new arrangements, but they were ones that we felt could be measured through a household survey and, in fact, were important to measure. Those four were:

Independent contractors, independent consultants and freelance workers, which we refer to as independent contractors, for short.

The second arrangement was on-call workers, those workers who report to work when they are needed, when they are asked to report.

The third arrangement was temporary help agency workers, those workers who are employed by temporary help firms.

And the fourth arrangement was contract company employees, which are those workers who are employed by a company that contracts out, them or their services, and who usually work on the premises of the company for which they are doing the work.

Our findings from February 1995 were rather interesting, I think, and somewhat surprising, even to us. We can compare those findings with a repeat of the survey in February 1997. In both cases, we found that one in 10 workers belonged to one of these four alternative arrangements. The largest by far was independent contractors, which accounted for 6.7 per cent of all workers.

We also found tremendous diversity, within the four arrangements and among them. For example, independent contractors as a group tended to be fairly well compensated. They also had a high level of satisfaction with their way of working. Most of them preferred to be an independent contractor rather than a regular employee. And very few of them were contingent, that is very few regarded their arrangement as temporary.

On the other hand, temporary help agency workers had pay that was below average. A majority would prefer to have a regular job, although a substantial minority did prefer their way of working. And somewhat surprising was the extent of long-term assignments among temporary help agency workers. I believe in the latest survey about 28 or 29 per cent of temps had been on their current assignment for one year or longer.

As far as unionization, relatively few of the workers in these alternative arrangements were union members, even in the context of relatively low unionization rates in the United States in general.

Between 1995 and 1997, there were relatively few changes in the extent or composition of workers in alternative arrangements. In fact, they grew at about the same pace as employment overall, although temporary help agency workers and contract company workers grew somewhat faster, on average. The demographic characteristics were very similar. One thing that seems to have changed is the preference for the arrangement. More workers in 1997 expressed a preference for their alternative arrangement than was the case in 1995.

The type of information that we can get on alternative work arrangements from a household survey is somewhat limited. Household surveys are very good for getting demographic and job data, but they are not the source for information on topics such as outsourcing or contract labor. We do have some limited information that I would like to mention, that is based on employer surveys.

The first was a special set of questions that was added to a number of industry wage surveys in the mid-1980s. These questions asked companies in about 13 manufacturing industries whether they contracted out for a variety of business services and, if so, to try to identify their motivations for doing so. Three motivations that were identified were: to reduce labour costs; to adjust to volatile demand for the company's products or services; and to take advantage of specialized skills that existed in the contract firms.

A lot of analyses of these data have been done by Kathryn Abraham, currently the Commissioner of Labor Statistics, together with Susan Taylor, in an article in the Journal of Labor Economics -- that is probably the one that goes into the most detail -- where they studied the relationship of the kind of service contracted for to the motivation involved, as expressed by the company.

In addition, BLS has a large monthly survey of establishments, the Current Employment Statistics Survey, which has been used to gather some information on some of the industries that have been discussed this morning. For example, that is how we know that temporary help agency work has increased something like sixfold from 1982, the first year that the survey captured that information, through 1997. It is also able to record the rather dramatic rise in employment in a variety of business services.

In conclusion, I would like to let you know, first, that there will be a third supplement to the Current Population Survey, on contingent and alternative arrangements, conducted in February of 1999. The results of that survey should be available some time late in the year. I think it is worthwhile to note the limited amount of data on outsourcing and contract work in general. More of the BLS information has been collected from the point of view of the worker. However, I think this kind of information can answer many questions and address some of the myths that surround these issues.

Thank you.

MR. BRAULT: Thank you very much for these very interesting presentations.

We will now move to questions from the floor. Are there any questions you wish to put to this morning's speakers?

I