Corporations are everywhere. We talk about them: we use expressions like ‘being corporatized’, or ‘the corporate agenda’, or ‘corporate culture’, or ‘the corporate sector’. We know many of their names: Exxon, Bell Canada, Weston, McCain’s, SNC-Lavalin, Bombardier, Rogers, Google. They are everywhere.
Yet, no one has ever seen one; no one has ever touched one; no one has ever smelled one; no one has ever kissed or hugged one. Some are mighty, some are medium-sized and some are tiny. While they are everywhere, they are invisible; they exist but are not tangible.
They are creatures of law.
Why does law promote such strange things as corporations?
The reason given is that law wants to provide a device that will lead to a better economy. The ideas is that, if people with resources to invest are allowed to put their resources together, the aggregated amount can be more efficiently deployed than the many separate amounts that make up that total could be. Efficiency is the goal. To this end, any number of investors can agree to bring some part of their capital to add to that of other like-minded investors. They can then apply to a public Registrar to form a corporation. If a corporation is registered it will own all the bits of capital invested by these applicants and it will be expected to use them to satisfy the investors’ craving for profits. Any such application by investors will be granted automatically. All that needs to be proved to the Registrar is that the applicants are competent, over 18 and not bankrupt at the time of application and that they have selected a name for the corporation that is not used by any other person or firm. If they cannot think of such a name, they may use a number. Once the application is granted, a number of legal things happen.
Making life easy for corporations
The new corporation is treated by law as a person with all the capacities of any adult human being, as being legally equivalent to you and me. As such, it can own and use property—that is, it can own and use the capitals put in by the investors—as you and I would be allowed to do if we had any capital at all, if we had any property that we could afford to invest. With this property, with this capital, the corporation, as a person, is able to buy things made by other legal persons, whether they be human beings or other corporations, mould and change these supplies, materials or services to produce things or services and to sell those. All these actions are legitimate actions, respected and enforced by our ordinary law. Law thinks this is such a good idea that it allows corporations to reproduce, to have children, as you and I can. Of course, we have to find a mate and create social and personal relations to do so. The corporation merely hires a flunky to go to the same Registrar that gave birth to it, proves it is an adult (easy to do as it is born as an adult!) and that it is not bankrupt at the time. It does not have to prove it is of sound mind
because, of course, it has no mind of its own.
Once registered, the corporation is ready to chase profits. No buts or beg your pardons: it is created, by law as a respected and honourable participating member of our political, economic and social systems. It meets with our formal approval. We do not restrict it in any way that we do not restrict ourselves.
Now consider a different scenario: the union scene
A bunch of workers come together and decide they want to form a union. The first thing to note is that law does not go out of its way to help them. Apparently, law does not believe that a union—unlike a corporation—will lead to more efficiency or to any other public good. So, workers have a much heavier burden to discharge when they want to form a union.
Why do workers want to unionize? They desire to do so because they do not want to compete with each other for scarce jobs. They are, by definition, people who do not have disposable assets, who do not have any disposable wealth. Whatever they own, they need to spend to satisfy their immediate needs: shelter, food, clothing, education, etc. In our capitalist economies, there are only a few people who have disposable wealth; the vast majority of us need to find a way to survive by working for those rich people. Those rich people do not have to invest their wealth just to survive. They have the whip hand when negotiating with needy workers. And they will whip us as this gives them more bangs for the bucks they invest when they employ us. One of the few ways that workers have to off-set this built-in, morally unjustifiable, disadvantage is to reduce competition among themselves. Historically, the law set its face against this. Its ideological starting point was, and remains, that all of us should act alone, all of us should take individual responsibility for our own welfare. Hence to join a union to exercise collective economic power to get better terms and conditions when contracting with those wealthy people who own most of the wealth, is, to the law, undesirable behaviour. It took centuries—and many bloody struggles in which workers were killed, imprisoned and deported—before we got to a situation where, in special circumstances, the law was forced to permit unions to be legally formed and to allow them to bargain on behalf of their members.
The modern right to unionize and bargain collectively remains seriously circumscribed. It is not so much a right as it is a limited licence, that is, a privilege that can be taken away. Unions are marginalized legal organizations; corporations are considered pivotal, to-be-protected organizations.
Making things difficult for unions
Workers, unlike investors, have to prove a lot of things before their union is given a measure of standing. It is not enough to show that they, the applicants, are adult, competent and not bankrupt. They must prove that a majority of people who can be classed as similarly placed workers in one workplace have agreed to join the union. To establish this, the union must find a place and time where they can talk with all the other workers in that enterprise. The rich guys, the employers, do not have to let the union organizers come and talk to the workers. More often than not, the rich guy uses its property right to keep unionists off its premises. Union organizers must find ways and means to speak with workers. As, until there is a union, workers feel threatened, organizers must frequently act secretly, stealthily. This means that union organizing is more like engaging in a sleazy affair than it is like a legitimate civic activity like, say, forming a corporation. The union may have to ward-off anti-union scare tactics by the rich guy, the employer. And the employer has a lot of scary tactics available to it. It can make the winning of a majority a complex affair by arguing that some people ought not to be included in a union because they are really bosses or just not employees. It can, and often does argue, that unionization will lead to job losses, closures or worse terms of employment. This leads to manipulations and costly manoeuvrings. The lesson is stark: no one can oppose the formation of a corporation; the employing class can oppose and hinder the formation of a union.
When the investors of capital come together, to use their collectivized power, they are doing so because they want to improve their lot. This is made easy by law. When workers come together to use their collectivized power they do so for exactly the same reason. This is severely inhibited by law.
Why is it all so hard?
In a society in which it is persistently claimed that everyone is equal and is equally treated this makes no sense. It makes sense in a capitalist economy where capitalists are to be treated better than anyone else. Capitalism and democracy, capitalism and equality, cannot live side by side.
Suggested talking points that arise out of this analysis, ie., what do we do with this understanding/ what is to be done?
As workers attempt to organize, they must argue that if it is wealth owner’s legally given right to invest their capital and join with others to do it, workers should have a similar right to invest their only capital, their bodies and their minds and join with others to make this more effective. If it is everyone’s right to form or join a corporation and be given legal protection for acting in concert with like-minded people, so it should be the workers’. Just as it is everyone’s right, as a matter of law, to join others when seeking profits, it should eb everyone’s right, as a matter of law, to join others when seeking to have decent conditions of employment. Every organizational fight, every fight about limitations on union activity, ought to raise the argument that everyone has the right to be a union member and that, like corporations, every union should have no restrictions placed on their actions, at least no restrictions that we do not impose on individuals. There is no reason why a union’s right to act on behalf of workers should be restricted to workers at one place of employment. There is no reason why bargaining should not be industry or sector-wide or even wider. That kind of discussion when a problem arises will change the nature of the debate and consciousness of workers.
Corporations versus Unions — part II
When a group of workers announce that they are about to exercise their right to strike, the media and the politicians bang the drums of fear and anger, especially, but not only, if the strikers work in a public utility, a school or medical facility. How dare these workers inconvenience us, how arrogant must they be to abuse their legally granted power?!
What a sham!
The right to strike, as a legally protected action, hardly ever amounts to the kind of threat posed to us by the legal, economic, or political power possessed by employers.
Limits on the right to strike
In Canada, a certified union may go on strike if first, it has negotiated to reach a collective agreement with a specific employer in good faith (a vague concept that allows employers and lawyers to make claims about bad faith, inflicting costly delays and tactical disadvantages on the union), second, it has given appropriate notices to the relevant employer and to a government tribunal and shown that the workers at that place of employment support strike action by voting (allowing for disputes about the voting procedures, as to who should be allowed to vote and for claims of irregularity—that is, imposing costs and creating tactical hurdles to clear), third, if a certain amount of time has elapsed (giving the employer a chance to prepare , to stockpile, to organize work be done elsewhere and/or to find replacement workers) and fourth, if it is shown that any order made by a Minister to enter into conciliation or mediation has been obeyed (more costs, more time).
Only if all these requirements have been satisfied can a union go on strike.
Limits on one way that employers can strike
The employer, dissatisfied with the progress of negotiations for a collective agreement, may, after showing it has bargained in good faith and has given appropriate notices (note: it does not have to hold a vote!), stop ‘working’. This means that it may close its doors to its workers. Just as workers are entitled, in the very restricted circumstances set out above, to withhold their investment in the business, I.e., their labour power, in order to put pressure on their employers, employers may withhold their investment in the business, i.e., their assets, their capital, in order to put pressure on their workers. This is called a lock-out. Apparently, our legislators want to make sure that employers are treated the same way as unions are. They do not want to be unfair to employers. They need
not have worried.
More limits on unions’ right to strike; retained rights for employers to strike
Once a collective agreement is concluded, the workers are not allowed to strike while it remains in force. The employer cannot lock-out the workers. That looks as if employers and workers are treated evenhandedly. But it is not true.
The employer may, of course conducts its business as it chooses. It can change work speeds, practices, tell workers how to behave, determine how many workers are to be assigned to certain tasks, whether new workers should be hired, whether a new piece of equipment should be purchased, etc. Such unilateral decisions will affect the terms and conditions of the workers. Some decisions may well contravene the ruling collective agreement’s terms but workers cannot use the power that gave them that agreement: they cannot strike to defend them during the life of the agreement. Instead, to set things right, they must resort to a quasi-judicial scheme, grievance arbitration, that takes time and costs a lot of money. In the meanwhile, they must live with the disputed terms and conditions imposed by the employer. This position is tellingly described by labour lawyers as a direction to workers to:
“Obey now, grieve later.”
What this means is that during the life of an agreement, workers cannot use their collective power, employers can. For that is what the employer is doing: it is deploying its combined assets—workers, equipment, substances, technologies—as it wishes. It can use its economic power, the workers cannot do so collectively. Workers may express their anger as individuals. That is, they cannot strike, but they may resign if they do not like the changed or new terms or the orders made by the employer. Of course, the threat by an individual to withdraw her labour has no real economic impact on an employer. Their lack of individual clout is why the workers formed a union and sought the right to strike in the first place.
The point is clear: crucial aspects of the imbalance between employer and worker power is retained by the legislation that gives workers the so-called right to strike which is portrayed as having swung the balance in favour of workers.
This is not the only way in which employer might continues to be protected by law.
The continued subjugation of workers, unionized or not
Just as individual workers may quit their job if they do not like the conditions of employment, that is, if they do not like the return of their investment of their individual labour power, every employer is entitled to withdraw its investment at any time it thinks its return on its capital is not satisfactory. This right stems from the fact that law allows a property owner yo do as it likes with its own property.
Thus, if an employer down temporarily tells its workers that it is not closing to get a better deal, that is, it is not bargaining by using a lock-out to get a better deal, it is no longer subject to collective bargaining law. It is exercising its private property rights. It may unilaterally decide to withdraw all or some of its property invested in the enterprise. This threat-which exists whether uttered or not–has enormous influence on the minds of those likely to be affected, acting as a brake on the demands formulated by unions and their members. To put it mildly, whether workers are unionized or not, a huge power differential is built into all employment relationships. diluting the force of the right to strike considerably.
To take but one example: before finally closing its Oshawa plant, General Motors, again and again, persuaded governments to give it large amounts of taxpayers’ money by the simple device of saying: ”Unless you give us the cash, we will take our cookies and go to, say, Mexico, leaving Oshawa high and dry”. And, again and again, governments showered cash on this giant corporation…and then it left Oshawa, leaving it high and dry anyhow.
Blackmail is too kind a word for this. What it truly is is the use of the employing class’ built-in legal power to threaten to wage a capital strike, even as our elites complain about the unacceptable power of unions because they might strike in some very limited circumstances. The employers’ right to engage in a capitalist strike is vastly more effective than the limited right to strike given to workers. It is fiercely protected by our laws. There are no restrictions of any kind! The employers’ right to strike is not a licence but a real right.
Everything is upside down in capitalist law.
The suggestions to be made at any discussion of this pamphlet would concern the nature of the bargaining unit, the role of unions as managers of discontent, the limits and costs of bargaining, the conduct of strikes (scabs, picket lines and the laws around these topics) and a linkage to the next pamphlet on public and political strikes.