Workplace Bullying and Intensification of Labour Controls in the Clothing Supply Chain: Post-Rana Plaza Disaster

This article examines workplace bullying and the intensification of labour controls in the clothing supply chain. It appears that extreme forms of bullying are deployed to intensify labour controls, including locking workers in, frequent wage cuts, setting moveable targets and carrying out intense observations. The context of this study is surplus value-starved clothing factories in Bangladesh. Global supply chains’ production regimes and the absence of state protections and trade unions enable factory managers to systematically deploy bullying tactics to achieve production targets. Drawing on Burawoy’s works, this article advances the debate of how workplace bullying is impacted by wider structural conditions with managerial strategies of coercion in factories. It is argued here that when the state intervenes in the factory only to protect and preserve capitalists’ interests, explicitly and implicitly, coercive strategies of control turn into extreme bullying on the shopfloor.

Monitoring or payroll maximization? What happens when workers enter the boardroom?

We examine whether worker representation on corporate boards results in improved monitoring or payroll maximization. Several economic theories predict that worker representatives would use control and voting rights in the boardroom to transform firm assets into private benefits and increased wages, but labor contract models suggest that workers’ inside information should permit improved monitoring. To investigate this conflict, we use mandatory worker representation on corporate boards in Germany. Using hand-collected data, our results suggest that the worker representatives’ payroll maximization incentives dominate their monitoring duties. Specifically, worker representatives reduce real earnings management when it results in wage cuts or job losses but not when it increases payroll or job security. Similarly, worker representatives are generally associated with improved monitoring of tax planning activities. However, when the risk of offshoring jobs is high, worker representatives do not promote tax planning for low-aggression firms and instead block aggressive tax planning for high-aggression firms. This evidence helps policymakers and researchers better understand the role of workers in corporate governance systems and contributes to the ongoing public debate about introducing worker representation in the United States and the United Kingdom.

NATURE-BASED TOURISM ENTERPRISE ADAPTIVE RESPONSES TO COVID-19 IN SOUTH AFRICA

COVID-19 is forcing a re-orientation of tourism research agendas. Emerging themes relate to ramification, transformation and adaptation. The aim of this paper is to contribute to the research cluster on adaptation by examining tourism business adaptive responses to COVID-19 through the lens of a case study destination in the global South, namely Bushbuckridge in Mpumalanga Province, South Africa. The methods implemented were qualitative, using semi-structured interviews. Data was analysed from 20 interviews conducted with enterprise owners or managers in a nature tourism destination which is one of South Africa’s tourism-dependent areas and thus most exposed to the negative impacts of COVID-19. The results show that adaptation to the crisis has been challenging because of the financial impacts experienced by these enterprises in the wake of minimal government support. The enterprise adaptive responses included staff reductions and wage cuts, adjustments towards the domestic market through price cutting and changes in marketing as well as adjusted tourism product offerings towards an emerging Black middle class domestic market. Of critical importance is the finding that these adaptive measures cannot replace the revenues formerly generated from the international tourism market. Accordingly, without a change in government policy and the availability of direct government financial support, there is a danger that in the short term the tourism product base will be diminished as many lodges and other tourism businesses are in danger of permanent closure.

Nominal Wage Adjustments during the Pandemic Recession

In this paper, we show that the pandemic recession has led to frequent cuts in nominal wages. Within three months in 2020, as many wage cuts had occurred as occurred throughout the Great Recession. Unlike employment declines, wage cuts were concentrated at the top of the wage distribution. However, these cuts have been relatively short lived, particularly among high earners. Finally, wage cuts have been concentrated in firms that have seen large employment declines. Wage cuts appear not to be a substitute for cutting employment, at least when the shock to labor demand is this large.

Mutinies against Austerity

The last empirical chapter considers mutinies under times of austerity, starting with the Chilean Navy and ending with the Invergordon mutiny of the British Royal Navy; both occurred in 1931. The first mutiny, called in response to drastic cuts in wages, terminates with Chilean attacks upon their own fleet, and there were calls to follow that lead in Invergordon. In the event the latter mutiny, also generated by wage cuts, is defused by reducing the cuts to wages and by dividing up the fleet—a classic tactic of the establishment that effectively separated the problems into individual ship’s cases that were much easier to discipline. And whatever the promises made to the various crews in Invergordon, the reality was that many ‘marked men’ were singled out and removed from the navy to prevent the spread of the political ‘contagion’.

Tracking the impact of COVID-19 on economic inequality at high frequency

Pandemics have historically had a significant impact on economic inequality. However, official inequality statistics are only available at low frequency and with considerable delay, which challenges policymakers in their objective to mitigate inequality and fine-tune public policies. We show that using data from bank records it is possible to measure economic inequality at high frequency. The approach proposed in this paper allows measuring, timely and accurately, the impact on inequality of fast-unfolding crises, like the COVID-19 pandemic. Applying this approach to data from a representative sample of over three million residents of Spain we find that, absent government intervention, inequality would have increased by almost 30% in just one month. The granularity of the data allows analyzing with great detail the sources of the increases in inequality. In the Spanish case we find that it is primarily driven by job losses and wage cuts experienced by low-wage earners. Government support, in particular extended unemployment insurance and benefits for furloughed workers, were generally effective at mitigating the increase in inequality, though less so among young people and foreign-born workers. Therefore, our approach provides knowledge on the evolution of inequality at high frequency, the effectiveness of public policies in mitigating the increase of inequality and the subgroups of the population most affected by the changes in inequality. This information is fundamental to fine-tune public policies on the wake of a fast-moving pandemic like the COVID-19.

Does income shock affect informal employment? Evidence from Russia

PurposeThe purpose of this study is to examine whether participating informality is attributed to income shocks such as wage arrears, unexpected wage cuts or compulsory unpaid leaves. The current research uses Russia longitudinal Monitoring Survey 2002–2015.Design/methodology/approachUsing formal jobs as the base category, the authors conducted pooled multinomial logit regressions allowing for the two additional employment statuses: workers without contracts and unincorporated business workers.FindingsThe overall results mainly suggest that no effects occur. In other words, unexpected negative income shocks are not the main driving force of informality. Although the majority of previous studies are based on survey questions on unexpected income shock which has sample selection bias, to obtain robustness, the current study used Russian minimum wage reforms as income shocks. This research shows that Russian minimum wage reform does not affect the decision of informality in the labor market.Research limitations/implicationsGiven the data limitations, the authors only observed and examined the supply-side of the labor market. Tax-evading motives would be the main reason for informality; to ensure this conjecture, however, demand and supply sides need to be simultaneously examined which is beyond the scope of this study.Originality/valueIn contrast to a large number of studies on cross-sectional differences in determinants of informal job holding, emphasis on the effects of income shocks on informal employment across business cycles has been minimal. The current study focuses on the business cycles because trends of informal employment can be interpreted differently regardless of whether in an economic boom or recession. Russia, as a unique natural experiment, provides us to examine informal job holdings over the business cycle.

Can reference points explain wage rigidity? Experimental evidence

I examine whether reference points can provide an explanation for rigid wages in recessions. Even though a recession provides a good reason to adjust wages downward, workers’ perception of a “fair wage” may depend on their previous wage, their reference point. Using a laboratory experiment, I test this idea by varying whether initially concluded contracts—and their stipulated wages—can serve as reference points. My experimental results show that with initial contracts workers punish wage cuts even in recessions, leading to considerable more rigid wages. Surprisingly, this is even true without an “objective” justification to feel entitled to initial contracts.

South Africa’s government faces major tax dilemmas

Significance Wealth, inheritance and ‘solidarity’ taxes are being considered -- with the latter recently flagged as one solution to pay for COVID-19 vaccine procurement and pandemic-related relief -- as well as strategies to broaden the tax base. Impacts A politically contentious wealth tax could prove a bellwether for whether technocratic or politically expedient measures are prioritised. Compromise on proposed public-sector wage cuts by government would raise taxpayer resentment and potentially hinder compliance. The ruling ANC will be reluctant to countenance the largest of planned yearly tax increases ahead of the 2024 general elections.

Wage Setting Behaviour of Firms in Industrial Estates of Khyber Pakhtunkhwa, Pakistan

The objective of the study is to analyze the wage setting behaviour of firms. For this study four major industrial estates of Khyber Pakhtunkhwa. Using stratified random sampling, data is collected from 342 firms. Multinomial logistic model is used to estimate the effects of determinants on wage change. Most of the firms change wage rate once in a year. Majority of the firms follow time-dependent wage policy. Half of the firms, which are following time-dependent wage policy, change the wage rate at the end or start of the fiscal year. Most of the firms are not found to index wages. Moreover, the percentage of firms not involved in wage indexation is higher for daily workers than for permanent worker. Labor productivity, employment level in the economy, government regulations, taxes, demand for the product, and inflation are important factors of wage change, but the most important factor is the labour productivity and least important is pressure from the labour union. Imperfect competition and size of the firms are the important determinants of wage flexibility, while wage indexation, information set of expected inflation and fringe benefits provided to workers are the important determinants of wage rigidity. It is important for Pakistan to avoid wage cuts at the times of recession and disinflationary policies be carefully designed as sacrifice ratio, albeit moderate, is not zero.