In publica commoda

Title of the Project
Two Worlds of Precarious Employment: A Comparative Study between Chile and Germany

In recent past decades important transformations have occurred in the world economy which have deeply changed the labor market. Standard employment, that is, full time employment with social protection, diminished, whereas atypical employment increased. The scientific literature evaluates atypical employment as precarious. While there is a relative consensus as to what atypical employment means, there is no a clear definition of what precarious employment really is. This study intends to define this concept of precarious employment. For this purpose, the Chilean and the German cases will be compared. The theoretical argument of my dissertation is that atypical employment is not necessary precarious employment.
Research question
During the past decades the number of atypical contracts of employment in Germany has increased. These atypical employment relationships differ from standard employment (i.e. a stable fulltime employment relationship, which falls within the scope of social security provisions) in at least one feature, usually even more than one. Atypical employment is not per se a problem, it turns into a problem when atypical employment becomes precarious employment. Precarious employment relationships cannot secure the worker´s existence because they cannot prevent income risks. In the case of precarious employment there are several kinds of income insecurities: there is no regular income, there is no protection against social risks such as unemployment, illness, accidents, and age. When such events occur, there is no possibility to receive any income. Additionally, someone working in a precarious employment relationship is not necessarily protected against those risks by collective agreements (between the trade union and the employer or – at firm level - between the works council and the employer).

Precariousness means that workers in precarious employment relationships have less rights than those who work under standard employment contracts: a) There is no legal protection at all. This is the case for illegal work because no valid contract of any kind exists. b) The worker is not entitled to any employee rights because he works under a commercial contract instead of a contract of employment. Or c) The employee does not have all the rights provided by labour law. The reason for this is that because of special conditions in the contract of employment certain labour law provisions are not applicable. For example, according to section 1 of the Act Against Unfair Dismissals (Kündigungsschutzgesetz) a prerequisite of protection by that Act is that the employment relationship has been in existence for at least six months. This means that employees working under a fixed-term contract might not be protected against unfair dismissals.

But there is not simply one definition of precariousness, it is a relative concept that depends on the context. Precarious employment relationships differ from each other depending on their sociopolitical context. In addition to that, precariousness does not mean the same for all groups of workers: In spite of the fact that many occupational groups are affected by precariousness the way in which this precariousness is expressed is not the same in all cases. From these ideas result the following theses:

1. The main thesis, which is supported in this study, is that precariousness is a relative concept which depends on the respective context: It is expressed in different ways depending on the sociopolitical context.
2. In a certain sociopolitical context, occupational groups with high qualification on the one hand and those with low skills on the other are affected by precariousness in different ways.
3. In spite of different sociopolitical contexts there are similarities as far as the division in occupational groups with high and low qualification is concerned: Groups of highly qualified workers are affected by specific kinds of precariousness, and so are the groups of less qualified workers.
4. When the institutions of social policy change, the kind of precariousness that can be found in a certain context also changes.

Justification for the selection of cases
The aim of this study is to answer the main question, i.e. what precariousness means in different contexts. For this purpose, following the most different case design, two cases are chosen that are contrasting with regard to their sociopolitical profile: Chile and Germany. The social policies of both countries are compared with each other in their constitutive facets, and in theirs compensative facets as well, i.e. the organisation of the labour market on the one hand and social security policy on the other. As far as the organisation of the labour market is concerned the two cases show the following differences: In Germany the labour market is highly regulated. In Chile, on the contrary, it is highly deregulated. In the case of social security policies, Germany has a generous system of social security. For Chile, the opposite is true: The Chilean social security system is rather deficient. This study does not deal with all branches of social security but only with the pension systems, which play an important role for precarious employment. In the German case there is a pay-as-you-go system, in the Chilean case, on the other hand, there is a capitalization system. The (de)regulation of the labour market and the pension systems are compared because these two aspects play a decisive role in the configuration of precarious employment relationships.


Method of comparison
Four comparisons are drawn in order to verify the four theses that were mentioned above:

For the verification of the first thesis ("precariousness is a concept that depends on the context") the Chilean and the German social policy systems are compared in their two facets: The organisation of the labour market as the constitutive aspect of social policy and the social security policy as its compensative side.

The second thesis ("in a certain sociopolitical context occupational groups with high and those with low qualification are affected by precariousness in different ways") is verified by making two transversal comparisons, both of which are intra-country comparisons. The two chosen occupational groups (lowly and highly qualified) in each country are compared to each other. This comparison is made both for Chile and for Germany. The selection of the occupational groups examined in this study is founded on the most similar case design, i.e. the Chilean groups are as similar to the German ones as possible. For this reason, workers in the cleaning industry in Germany and housemaids in Chile on the one hand are selected (group of lowly qualified workers), free collaborators in Germany and their counterparts in Chile (group of highly qualified workers) on the other. The group of lowly qualified workers is contrasted with the group of highly qualified workers in each country.

For the verification of the third thesis ("in spite of different sociopolitical contexts there are similarities as far as the division in occupational groups with high and low qualification is concerned: lowly qualified workers are affected by specific kinds of precariousness, and so are highly qualified workers") two transversal comparisons are made. This time, they are inter country comparisons. The group of lowly qualified workers in Chile must be compared with the German group (i.e. housemaids with workers in the cleaning industry). The same must be done with the highly qualified occupational groups (free collaborators in Germany and their counterparts in Chile).

In order to verify the fourth and last thesis ("when there is a change in the institutions of social policy the kind of precariousness changes as well") a longitudinal comparison in Chile is made. This longitudinal comparison aims to demonstrate how precariousness changes when the conditions of social policy change. For the purpose of this comparison the two facets (constitutive/compensative) of social policy have to be considered. A specific aspect of the labour market and a specific aspect of the social security system are examined: the deregulation of the labour market and the pension system. These aspects are chosen because radical neoliberal reforms of the social system took place in Chile: In 1979 an extensive deregulation of the labour market were undertaken, in 1981 the pension system was privatized. This results in a pre and an ex post investigation design. Both the deregulation of the labour market and the reform of the pension system are especially important for the problems of this study because they play a significant role for the precarious employment relationships.