New Zealand's current Labour-led government, driven by union interests, is doing nasty things to employment law which serve to advantage a few (select unions) in the short term, at the long-term expense of nearly everyone. However the situation may not be as depressing as it appears. The final result of over-prescriptive regulations, between employer and employee, could be a kind of progressive backfire as employees option to sell their labour as private contractors, only. This could trigger an excellent evolution.
The model that I'm thinking of is the same as what we have today, with tradesmen. Many tradesmen today link to a website which acts as a hub for people looking for a worker (example here). The customer search is efficient, and examples of the tradesman's work can be viewed online, with customer feedback also presented.
This is the free market in action, at its best, backed by the internet which serves as an excellent communion tool and, so importantly, a medium for comprehensive transparency. People win the reputations they deserve, positive and negative, which directly impacts what they can charge for their labour. As always, quality goes up and costs go down, as the performance-pressure is on (I must say, the opposite situation of a state monopoly,).
So here is the question. Why not have all workers act as private contractors? Why not have a colourful open CV selling yourself, online, based within a go-to hub for employment so you can be continuously headhunted? Your open CV would have pictures, video presentations of yourself and maybe your work.
The real question of course, is what would the effect of this be...if everyone is to effectively work for themselves and on the same level of a tradesman?
Well for a start, you would be able to set your own wage (for any given job) as the legal minimum becomes irrelevant. Technically you are a business - not an employee. This is great for people who would otherwise be forced out of the job market, such as the only commonly skilled, disabled, or slow. Increased labour participation of course equates to higher productivity, which is the foundation of general prosperity (carving up cakes never works - growing cakes always works).
I think it's particularly good for the elderly. For example, if they can work 15 hours a week on a low performance-pressure wage of, say, $10 per-hour, giving them an extra $120 after-tax adding to their pension, then that could be an invaluable monetary boost while staying in contact with others, and keeping physically and mentally active for health.
It's also great for people who are working part-time, or otherwise not at all, yet who want to boost their income a little with their skills. Mowing lawns, gardening, homecare, etc, or basic mechanical work?...anything. Once the system is in place, anyone can broadly market themselves with a few clicks on their website, to update their profile.
As for employee-employer relationships, it would work wonders. Employers would be under constant pressure to respect wanted staff, because if the employer tolerates abuse or other problems in their workplace, they can then know that all their current contractors need to do is maybe lower their price a little, on their open CV's, and they will have others offering them roles elsewhere - maybe immediately. They can be constantly 'tempted' with an easy transition.
[Note, it should be law that no employer can demand that a given contractor cannot directly advertise themselves to other potential employers, online, via the main site. The competitive dynamic needs to be protected].
Transparency must go both ways:
We should also make it mandatory for contractors to assess their employers, via a government online survey, with the results displayed online so we can achieve the [currently missing] proper workplace transparency, which will then drive every employer to be sure that their workplace is relating to their staff as they should. It should be costly for an employer to fail to respect staff...
-Employers that tolerate abuse of any kind would find that they cannot get good staff at a good price, as they develop their reputation which is openly and immediately accessible to anyone, via a single click on a screen. Bluntly, who would accept a job with an employer who has "a-hole" written all over their open assessment? You see what I mean.
[Note, with an accountability system like this the employer must have their right-of-reply included, and rankings should be taken as medians, not averages, to defend against unfair assessments. Needless to say the system would need to be developed carefully, with the template probably created as a state service. If an employer can be a referee for an employee, then surely it should work the other way around too? In both cases employers and employees should be able to present an open right-of-reply in response to any given assessment].
Concluding:
Transparent, accountable, free markets with plenty of competition are by far the best form of protectionism in the workplace. It empowers employers to quickly remove inappropriate workers, and workers to quickly remove themselves from inappropriate employers.
The far greater flexibility, along with an absolute minimum state regulation, makes for more commercial investment and likewise rapid economic development (replacing handsaws with chainsaws, basically. See here) as New Zealand becomes a better place to invest in.
But what about job security? Being an honourable contractor is all the security you should need. No company wants to lose good workers, and with this system you will find it won't so much be about finding work, but simply the price you can charge.
-In saying this, sometimes middle-managers want to get rid of highly talented workers, as they may be seen as competitors or personal profesional threats. But I predict this can and would change. The enhanced need for internal transparency within companies (driven by the need to quickly identify and solve problems, to avoid developing poor open assessments) would clean out a lot of that kind of politics. Abuses of power would be dealt with quickly as they would naturally need to be.
As employers must compete hard for staff, the market will precisely decide the prices (wages). As the system induces more rapid economic development, you will find that wages alround steadily rise. Productively growth is the universal bottomline for prosperity.
And finally, as I stressed previously, we will evolve workplaces that ensure people are happy. More people will go to work smiling - not dreading - because an employers failure to respect people will come at a hefty price. So they will. And also, employers will be free to remove toxic contractors quickly, as we're using accountable markets to make things work like they should, which is far more effective than state regulations that too often make things worse, not better, as they are notorious for unintended consequences.
Employers in general should have no problem with this change. The new demands that they would tolerate are the same demands that their competitors must tolerate. All it does is change the game a little, and as I believe only to good effect. There's nothing for employers to fear unless they should be afraid.
However one key change we should see, is employers approaching prospective employees when seeking new staff, and not so much the other way around. Employers will search for contractors and make offers, as opposed to openly advertising for staff to come to them. It would be a headhunting game, like when people seek out a tradesman to build a new addition to their home.
Ultimately contractor and employer relationships will become more mature, professional and progressive. All staff (including cleaners!) will predictably be treated like co-professional, and employers will simply be seen as what they are - a contractors given customer. It would, hopefully, be the end to the parent/child relationship that we see in New Zealand employment culture today.
Another reason why we should all work for ourselves, or simply start thinking like this, is that the administrative side can be taken care of seamlessly via the internet. There's no [theoretical] need to fuss to be self-employed. Once you're on the system, taking on different jobs should typically be as simple as logging-in and logging-out, with a few clicks of an icon.
-Andrew Atkin
Related Posts:
Achieving meritocracy (here):
Building training videos (particularly good for new contractors): (here)
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