Digital Transformations & Challenges for Trade Unions

Anna Byhovskaya

Trade Union Advisory Committee to the OECD (TUAC)

SCALE/ SPEED/ SCOPE

Disruption of key sectors (transport, health, hospitality, finances, education)

Fragmentation of production processes

Digital products know no degradation: recombined, tailored and versioned – shift from physical value creation

Workers compete against one another

Outsourcing to platforms

The nature of work is changing

Increased flexibility

More inequality

Shifting control (to the manager, to the platform etc.)

Mobile work

GVCs and the loss of place

Productivity wage gap

Inequalities

412 million internet users (Europe)

$4 trillion in global e-commerce sales

by 2020

Digital Disruption

Disruptive innovation describes a process by which a product or service takes root initially at the margin of the market, relentlessly moves up & eventually displaces established systems.

No industry or country is immune to technological change: differentials in absorptive capacity

Digital Economy

Cross-border, jurisdictional

ambiguity, rapid data flows

Lead industry players

Broadband coverage, ICT use

New business models

Online on-demand & crowd work

Autonomy and control

Pay by the task, assignment, or sales

Employment relationship & “the

concept of the employer”

Social security, taxes and training

deficits

Regulatory Challenges Quality

INVESTMENT COMPETITION TAXATION EMPLOYMENT PRIVACY

Next Production Revolution

5m jobs replaced by 2020 (WEF, 16’)

47% of US jobs potentially automatable (Frey & Osborne, 13’, Ronald Berger)

9% of jobs are at high risk of being displaced through automation, as over 70 percent of the tasks they involve can be automated. Another 25 percent of jobs would be transformed but not necessarily eliminated, since only half of the involved tasks can be automated (OECD & McKinsey, 16’)

The Internet of Things reduces costs among industrial adopters by 18% on average.

Global supply of industrial robots increased from 81k in 2003 to 254k in 2015 & the price keeps on falling

Tech jobs requierments change every 3 yrs (Siemens)

DEEP DIGITAL INTEGRATION + DATA INTENSITY

Changing or automatable occupational tasks

Use of data to monitor performance

IT IN EVERYTHING

Functions become more integrated in

the core business

THE NOTION OF SERVICE

Growing expectations to

add value

Servitification

Convergence between manufacturing & services

• Networks to predict

failures

• Manage energy use

• Provide good jobs & a

better work-life balance

• Disruption beyond

manual & cognitive

routine jobs

• Robotics/ CPS for blue-

collar work

• AI for white-collar work

• More complex GVCs

Growth of new and “hybrid” roles across sectors

Health & Care Education Biotechnology Infrastructure &

Mobility

Engineering & IT Financial

Services

Management &

Professional

Services

Technology Telemedicine, AI in

Radiology reading,

Clinical Analysts,

Informatics Nurse

Specialist

Distance Learning

Services, Mobile

Applications for

Training

Organ design; 3D

printing;

nanotechnology

specialists

Self-Driving vehicle

infrastructure

developers,

Hyperloop developers

Robotics engineering,

Internet of Things,

Machine learning

Blockchain Specialists,

Fintech Sourcers,

Crowdfunding,

Multichannel banking

Managers blending

tech and sector

leadership and know-

how

Security Pharma and health

systems cyber

security specialists

Containing

Cyberbullying; cyber

security for learning

databases

Greater food security

through

biotechnology and

advanced farming

methods

Safety certification

and inspection for

self-driving vehicles

and infrastructure

system.

Next generation

cybersecurity tools

Financial

Cryptrography,

Banking Cyber

Security.

Managing global

cybersecurity

strategies

Demographics Geriatric Personal

Care Aides, Fitness

and wellness

coordinators for

seniors; childcare

professionals

K-12, TVET and

university teachers

across emerging and

advanced economies

Prosthetics,

immunization

production;

reproductive

medicine and

research

Road, rail and air

mobility

infrastructure blue

and white collar roles

in emerging markets

Smart infrastructure

and urban planning

specialists

Multigenerational

advisors, Retirement

advisors

Adapting

management

methods to

multigenerational

team leadership

Nature of Work Home visit nurses,

childcare, eldercare

providers working on

care platforms

On demand tutoring

via platforms; lifelong

learning Specialists;

Mobility and sharing

platforms (transport

and hospitality)

Project based

engineering work

End to end digital,

Video advisory, social

trading, Moblie

money, P2P

Managers leading

globally dispersed,

virtual teams

Climate Change Industrial safety and

health engineers

Environmental

sciences and

management teachers

Environmental

Biotechnologists-

using microbes to

consume pollutants

Green Infrastructure

coordinators and

installers

Environmental

Engineering, Clean

energy,

Green

investing/advisory,

Advanced

environmental

portfolio risk

screening

Environmental Impact

Assessment Managers

DIFFERENTIATION & TIME SCALES ALONG VALUE CHAINS + ACROSS SECTORS

Anticipate Change

✓Social/ employment effects (including automatable or modifiable tasks)

✓Quality of future work: Cost savings - for whom?

✓Skills needs & training systems

✓Technological maturity & times scales

✓Enhanced complexity of GVCs

✓Industry spending on ICT & KETs

✓Ethical & liability standards

✓Environmental & human safety

Breaching Silos

Little if any public consultation (until now), only few governments & institutions seriously involve stakeholders

Tripartite Frameworks ILO Future of Work Commission

OECD Going Digital

Work 4.0/ Industry 4.0

Disruption Council (DK, 6 TU reps)/ Multi-stakeholder Digitalisation Council (Sweden)

Employment Security Councils (Sweden)

EC consultations on social protection

Multi-sector agreement – recommendations on the digitalisation & platforms (Belgium)

The Labour Movement Going Solo

Legal action

Campaigning (Transport for London declining licence)

Organising in growing sectors (Israel)

Outreach to self-employed and non-standard workers:

regulatory change (Ireland)

platform (Germany)

Evidence: The Gig is Up vs the Taylor Report (UK)

The role of CB and EPL in delivering fairer outcomes

OECD 2017: centralised or coordinated CB cushions the impact of

economic shocks;

OECD 2016: reducing EPL for regular contracts negatively impact the

lower middle class and the poor

OECD 2016: Minimum wages, EPL, trade union density, wage

coordination reduce wage inequality between firms

IMF 2015: link between trade union density and rising inequality

ILO 2016: firm use of temporary contracts is not determined by the EPL

of regular workers.

ILO 2016: Benefits of collective bargaining for NSFW (ILO)

Firm Dynamics

Services have been an important driver of firm creation: contributing around three-quarters of all jobs created by new firms in 2014. Productivity gaps between firms of different sizes are much smaller in the services sector than they are in manufacturing.

Wage gaps in manufacturing are increasing in many countries: Wage gaps between larger and smaller manufacturing firms increased in Norway and the United Kingdom and in all OECD Eastern European economies except Poland, between 2008 and 2014.

The development of affordable digital tools and platforms offer new opportunities for micro-enterprises to tap into foreign markets.

Common Ground

Competition – level playing field (SMEs underuse)

Purchasing & “Brain”- power vs. income inequality

Sustainable tax benefit structures

Responsible business conduct across the business supply chain

Italian Transport Union & Amazon

IndustriAll & Asos

Strategies

Skills & Training systems

• Cognitive, social and problem-solving skills

• Skills necessary to cope with and shape digitalisation process

• Exploit new opportunities of learning through information technologies

• Concrete governance, financing & operational frameworks

High Performance Workplaces

• Stimulate more effective employee involvement and commitment

• HPWs are associated with increased profits

• Employees report higher job satisfaction and greater opportunities for innovation and creativity, alongside lower staff turnover

Openings

Negotiating wage floor standard agreements (ACTU & Airtaskers)

Recognition of the freedom to associate and of collective voice (Foodora, Austria)

Total surveillance workplaces (Orange France)

OHS (poorly tested algorithms, new materials)

Ethical standards on the development and use of AI (Commission with Google, UNI Global)

Shape a just transition, protect core rights & put a

halt to regulatory arbitrage

• Existing workers cannot simply be left behind to face unemployment

• Involve all affected workers & trade unions

• Customized to sectors & regions

▶ Standards for the diffusion of new technologies agreed in tripartite frameworks, through collective agreements & consultation at the firm level

▶ Address challenges from digital business models in view of high market concentration, corporate governance & taxation

▶ A just transition framework including by securing quality jobs & by ensuring affordable access to connectivity worldwide

▶ Identify sectors with high job creation and displacement potential through interdisciplinary and participative research that takes into account the role of trade unions

▶ A lifelong learning guarantee: strengthen VET systems, allow for paid educational leave & introduce learning time accounts

▶ Universal social protection schemes that are universal and portable, if needed built on multi-employer plans

COMPOSITION AND QUALITY OF NEW JOBS

THE ROLE OF TRADE UNIONS

• Monitor the compliance with

labour standards, & inform

about their rights and benefits

• Ensure that collective

agreements & worker

representation mechanisms

account for the use of new

technologies

• Organise workers in new fast-

growing businesses and

sectors

• Contributing to new ICT,

digitalisation and broader

policy frameworks (e.g. in

councils, commissions)

• Participating in the delivery

& delivery of on-the-job

training and VET systems

• Offering exchange platforms,

career guidance and e-

training offers

How to deal with it?

Challenges

• Independence yet direct competition

• Isolation

• Geographically expansive

• Task-based, fragmented, short-term

• No re-employment guarantee

Solutions

• Workers seek collective agency

• Establishing the location & duration of the work (data)

• Employment classificiation

• Union renewal or new unions,

• Cooperatives, online forums, worker centers

• Increasing access to employer provided social services

• Sectoral bargaining may be particularly suited, need strong representative structures