The Supply Side

Workers may see part-time employment as a desirable or necessary form of labour market participation for a nurober of reasons. Frequently financial, social or legal disadvantages are recognised and accepted when making the decision to work part time - indeed some of these

"disadvantages'' may even be the motive behind the decision to take up such employment. The fact that part-time workers are sometimes excluded

from the obligation to pay employee social secur.ity contributions, coupled, in some countdes with tax exemption on low income, may provide a significant incentive to accept such forms of employment relation. For certain groups, such as married "secondary" earners, young people still in education seeking additional income for a limited period, or pensioners who want or need additional income, the freedom from social security obligations, implying higher net income, may constitute the prime attraction of part-time employmenL

This exclusion from the system of social security may, however, become very problematic, if the social or individual arrangements on which this freedom from the obligation to contribute to such systems is based, show signs of disintegrating. Examples of this are situations where income security via another (primary) breadwinner is no Ionger guaranteed (and where in the case of divorce the compensation for the reduced ability to earn one's living on the labour market is inadequate ), or where the precarious forms of employment performed by young persons still in the education system are no Ionger a short-term option, but become the only chance of finding employment at all. In such circumstances insurance-free employment ceases to be a "bridge" to regular fully protected part-time employment and becomes a "trap" for the workers affected.

Very few studies are available on the dynamics of part-time employment, in particular on the motives and occupational biographies of (marginal) part-time workers (for the West Germany cf. Büchtemann/Quack 1989).

Health insurance/maternity benefits

As on the employer side, there are differences in the way various categories of workers are integrated into different national systems; here again we can distinguish between financial contributions on the one hand, and the granting of benefits on the other.

In the countdes mentioned above, citizens have the right to get medical treatment by the National Health Services. In Denmark, while all taxpayers contribute to the health insurance/maternity benefit scheme,

benefits provided by employers are conditional on e~ployees working more than 10 hours per week and, in the case of maternity benefit, having been insured for at least 6 months during the 12 month period before the birth of a child. In other words~ workers who either work too few hours or have been employed for too short a time are not entitled to employer-paid benefits, receiving merely the (low) level of sickness/rnaternity benefit paid under the state scheme. All workers contribute to the finances of the health fund unless their income is solowastobe tax exempt .

. )'.l

The situation in the United Kingdom and the N etherlands is rather different: while here too isanational health service (financed by taxes) or a "people's insurance system" (financed by employer contributions) respectively, financial benefits such as sick pay and maternity benefit are financed jointly by ernployer and employee contributions. Contributions are paid by all employees in the N etherlands ( except domes tic s taff) and by all those earning above 46 pounds per week in the United Kingdom. If a non-insured worker becomes sick or has children he or she is not entitled to transfer:"benefits from the insurance scheme (in the United Kingdom), or receive support either from the employer or the health fund (in the Netherlands). In the United Kingdom the employer is obliged to grant maternity leave only if the employment relation amounts to more than 8 hours per week and 5 years' tenure or more than 16 hours after 2 years' job tenure.

In the remaining three countrie·s (West Germany, Belgium and France) the health insurance system is such that, while it applies only to employees, dependent family members and the unemployed are also covered (although they do not receive cash transfers). The schemes are financed by employer and employee contributions, whereby matginal part~

timen; and those on short-term contracts are excluded both from contributions and benefits. The critical thresholds are 10 and 15 hours per week (or minimum income levels). Maternity benefits are conditional on a given length of job tenure. N on-insured persans receive no financial compensation in cases of sickness or maternity from the insurance system

or employer despite the loss of earned income they have suffered 11.

Exemption from insurance contributions has the advantage for employees of increasing net income during employment, but entails the absence of any financial compensation in tim es of sickness and maternity ( during which, it should be remembered, employment is often forbidden by law).

Old-ageinsurance

The various systems of old-age insurance can similarly be grouped into a number of categories. In the N etherlands and Denmark all tax-payers contribute to the financing of the state pension scheme and all citizens are entitled to a state pension. The level of benefit depends on the length of time spent in the country in Denmark, but is granted irrespective of this in the Netherlands where marital status is a decisive factor. In the United Kingdom and France state schemes provide a basic pension, although these are linked to paid employment. The basic pension in the United - Kingdom is subject to contributions having been paid: in order to receive the full pension an employee must have paid contributions for 90% of his or her working life; contributions are only payable above an income of 46 pounds per week. Those who have paid contributions for less than 52 weeks are not entitled to a pension at all. In France the minimum pension requires at least 15 years of paid employment. This pension is partially decoupled from income and need; it is calculated based on the most favourable 10 years. A supplementary pension, necessary for elderly persans in all four countdes if they are to live above subsistence level, is dependent on both the contributions paid and the length of employment.

The "people's pension" in the N etherlands and Denmark does not distinguish for these purposes between full~ and part-time employment, whereas in the cases of the French and British basic pensions, and the supplementary pensions in all countries, it is of decisive importance whether workers have paid contributions at all, and if so how much and for how long. The supplementary pension schemes are geared towards the

11 This practice has recently been seen as an indirect form of discrimination against women workers by the European Court, which ruled that a West German employer had to pay sickness benefit to a non-insured (female) worker (cf. Hörburger 1990).

principle of life-long, continuous fuH~time employment .. Significant cuts in benefits occur if employment is interrupted, is not subject to contributions or if earned income falls due to the part-time nature of employment. In other words, it is not only that marginal part-time workers are excluded from the supplementary pension schemes altogether, but also that those with regular part-time work, who regularly pay contributions, end up with reduced pension entitlements. While the conditionality described above applies to the supplementary pension in Denmark and the N etherlands and also to the basic pension in the United Kingdom and France, this is the sole principle in Belgium and the West Germany. This means that those workers not subject to social insurance contributions (in West Germany those working less than 15 hours per week and earning less than DM 470 per month; in Belgium those working less than 4 hours per day) have no· entitlement to a pension of their own, while part-time workers above the insurance threshold and those with discontinuous employment biographies have significantly reduced entitlements.

For workers dependent on part-time employment these different systems of providing for old age can have serious effects on their (financial) situation after retirement. While in Denmark and the Netherlands elderly persans receive a minimum provision independent of their employment biography, and in the United Kingdom and France at least a basic pension if th_ey were employed at all, in Belgium and the FRG a working life of marginal part-time employment can end without an independent and individual entitlement to a pension. Depending on the precise relationship between basic and supplementary pensions, the pension system permits workers in the first four countdes to opt for part-time work with far less risk in later years than in Belgium and the FRG. In these two countdes marginal part-time workers are dependen.t either on support from a full~

time worker with pension entitlement (including provisions for surviving dependents such as widows) or, in the absence of such support, on social security, which in mostcountdes is subject to a means test.

The short~term advantage of an increased net income from employment which is not subject to social insurance contributions must be set against

the considerable social risks facing marginal part-time ~orkers at the end of their working life; this risk is, as we have seen, particularly acute in West Germany and Belgium. Recent empirical surveys indicate that women's awareness of · the importance of the risk is growing in many countdes (for the FRG cf. Schwarze/Wagner 1989a/b).

Unemployment Insurance

Warking time is an even more important determinant of unemployrnent insurance benefits than is the case in the health, rnaternity and old-age insurance systems. Nationalsystems of social security covering the risk of unemployment are, more heavily oriented towards the insurance principle with the result that unemployment benefit systems have relatively high thresholds for both contribution-financing and benefit entitlement. Part-time employees working fewer than 18 hours per week (West Germany), 15 hours per week (Denmark), 3 hours per day (Belgium), or earning less than 46 pounds per week ( United Kingdom) are excluded entirely from national systems: they pay no cöntributions and receive no benefits.

Moreover, those who do pay contributions (in France and the N etherl ands all employees must do so) do not always receive benefits proportional to their contributions. In Belgium, for example, part-time workers employed for between 3 hours per day and 18 hours per week pay reduced contributions and have restricted benefit entitlements; only those receiving at least average wages are entitled to the same (pro rata) benefits as full-time employees. Similarly in Denmark, part-timers whose working time lies between 15 and 30 hours per week have only a reduced entitlement to unemployment benefit. In France, part-time or short-term workers falling below minimurn tenure or warkingtime thresholds receive benefits which arenot proportional tn their working time and their level of contributions. The situation in the N etherlands is similar; part-timers with a weekly working time of less than 8 hours are entitled only to the minimum level of benefits limited to a maximum of one year; all other

workers receive high er benefits for Ionger periods. O~ly in the United Kingdom do insured unemployed workers receive a flat rate independent of previous income; this, of course, treats part~time workers as full-time workers.

A further significan t f actor in the FR G and the United Kingdom is tha t, in principle at least, those receiving unemployment benefit must declare themselves willing and able to take up full-time employment. Although individual or group-specific exceptiorts to this rule are sometimes granted (for child-care responsibilities, for example ), this condition nevertheless provides an indication of the social norms on which the unemployment insurance system is based.

In sum, part-time work (in particular employment for fewer than half of regular hours), while it may lead to a limited reduction in contribution payments, often results in workers being completely or largely excluded from unemployment benefits. The length of employment is also particularly important in the unemployment insurance system as all national systems have minimum employment periods attached to benefit entitlement, and in almost all cases the length of time for which benefits are paid is linked to the duration of contributions payments.

In some countdes the unemployed can take on part-time employment without losing their entitlement to unemployment benefit. In West Germany, for instance, part-time employment up to 18 hours per week is allowed, although above the negligible sum of DM 30 per week 50% of earnings are deducted from unemployment benefit. The sum of both . sources of income must not exceed 80% of the previous month's net

. . - . . . .

income, in order to prevent the combination of unemployment benefit with contribution-free part-time employment from exceeding the level of unemployment benefit to any great extent. Other provisions, introduced in a different political context, exist in Belgium, France and Denmark: in these countdes workers with a "full-time entitlement" to unemployment benefit receive unemployment benefits if they take up part-time

the previous level. Many of these provisions were introduced in the 1970s in order to encourage the unemployed to take up part-time employment.

Position of part-time workers in labour law

As shown in the previous sub-section, the inclusion of part-time workers in protective labour-law provisions varies widely, particularly on questions such as protection against irregular employment, the right to a written labour contract and dismissal protection. It is difficult to envisage any positive incentives for taking up part-time employment arising out of the legal position of such employment, except perhaps that the lack of dismissal protection in Denmark, the United Kingdom and the Netherlands also implies that part-time workers have the right to quit' without notice. This apart, the exclusion from overtime bonuses, from active and passive electoral rights to institutions of workforce representation (in the Netherlands) and from maternity benefits etc.

amount to an unjustifiable discrimination against (marginal) part-timers compared with (regular part-time and) full-time workers. In particular irregular, short-term, part-time employment is obviously considered less worthy of protection by governments and the parties to collective agreements. While labour law and the collective bargaining system - the origins of which lie in the compromise between the "right" of employers to dispose of labour and capital as they seefit and the substantial interests of those dependent on wage and salary income - have responded to a limited extent to the growth of unprotected employment, very substantial gaps are evident in those employment relations based on a low volume of working hours.

These gaps are most obvious in the regulation of flexible part-time working and of additional work ("overtime") for part-timers. This of course is precisely the area in which the interests of employers and

part-time workers most immediately conflict. Many part:part-timers, especially women with children, choose part-time work in order to be able to look after their children when they are not under external supervision. Flexible working time, often changing by the week, obligatory overtime on demand, inconvenient working hours during evenings, early mornings or weekends conflict directly with the commmitments which induced such women to take up part-time work in the first place. Given the unequal power relation between employer and employee, it is the employer who will be in a position to define the legal "space" left open by labour law. The scope for the employer to modify the employment relationship according to his/her interests is hardly limited by statutory or collectively bargained restrictions in the United Kingdom and the Netherlands.

On the basis of the above it is possible to attempt to draw up a balance of the advantages and disadvantages of (marginal) part~time employment.

Short-term advantages (such as a high er net income) are offset by substantial disadvantages in the event of sickness, maternity, unemployment and in retirement. In the case of old-age pension insurance the risks are lower in countdes with a fixed basic pension than in those in which the pension system is tied exclusively to paid employment. In the health insurancejmaternity benefit system the risks are serious in all countries~ and are still more significant in the case of unemployment insurance because of the exclusion of even larger numbers of part-time workers in some countries.

The following table gives a summarised overview on the position of part-time employees

Employees' Status in Social Security and Labour Law Regulations (Part-Time Compared to Full-time Employees) ·

DK F B FRG NL UK

Health Insurance/

Maternity Benefits

-contributions

=

^{= =} _1)

-benefits ^_1)

Stat. Pension Insur.

= = =

Suppl. Pension Syst.

Unemployment Insur.

-contributions ⁼

=

-benefits

Dismissal reg.

= = =

-.

part-time as full-time employees

lower f or part-time with low hours volume --:

1):

lower /reduced f or part-time employees with less than 50% of reg. working time only domestic employees excluded

The decision to work part- rather than full-time is associated with an increase in risks due to the relative weakness of statutory and collectively bargained protection in all countries. Part-time workers with few hours are often no better protected than those completely outside the employment system. Given that the decision between non-employment and (partial) employment is linked to the financial position of the household, part-time workers are clearly dependent on earned income but simultaneously inadequately (if at all) protected from the effects of the loss of such earnings. The financial opportunities offe-red by part-time work are thus built ou sand. Part-time work, particularly in its low-hour form, represents a form of employment which is subject to numerous risks

and uncertainties.

While the international comparison has shown that there are differences in the degree of risk, it nevertheless remains a common feature of all countries investigated that the significant gaps in legislative and collective regulation of part-time work divides this form of employment into a

"protected sector" consisting of those working more than 16-18 hours per week (high volume or "long" part-time work) and an "unprotected sector"

below this level (low volume or "short" part-time employment). In this

"precarious" segment the balance of incentives would appear to lie in

favour of the employer, with workers bearing considerable additional risks.

The discussion whether such forms of unprotected part=time employment are "voluntary" or "involuntary" misses the point. Which of the objective disadvantages faced by part-time workers on low hours are overcome by pointing to the fact that employees "choose voluntarily" to work in such employment relations? The subjective acceptance of employment relations such as exist on the labour market may make such risks more bearable, it does not make them disappear. Forthis reason the concept of (in)voluntariness is more of an indicator of the extent to which those affected come to accept the realities with which they are confronted on the labour market. This, of course, depends not only on their own individual situation but also on available labour market alternatives, on social norms of (in particular female) participatiort in the labour market, on the restrictions on their timedbudget in the case of having children etc .. How is it possible to use the concept "voluntary" to explain the fact that in all countdes women perform lower paid work with more restricted chances of

The discussion whether such forms of unprotected part=time employment are "voluntary" or "involuntary" misses the point. Which of the objective disadvantages faced by part-time workers on low hours are overcome by pointing to the fact that employees "choose voluntarily" to work in such employment relations? The subjective acceptance of employment relations such as exist on the labour market may make such risks more bearable, it does not make them disappear. Forthis reason the concept of (in)voluntariness is more of an indicator of the extent to which those affected come to accept the realities with which they are confronted on the labour market. This, of course, depends not only on their own individual situation but also on available labour market alternatives, on social norms of (in particular female) participatiort in the labour market, on the restrictions on their timedbudget in the case of having children etc .. How is it possible to use the concept "voluntary" to explain the fact that in all countdes women perform lower paid work with more restricted chances of

Im Dokument Beschäftigung Research Area Labour Market and Employment (Seite 48-58)