Contracting Out

Q: The University must inform the Union first before any contracting out occurs.
(Fact)

Contracting out or outsourcing results in the elimination of jobs and the replacement of employees by workers who are hired by a third party company. Companies bid on contracts and paying lower wages to workers is often how the company makes money on the contract. As the majority of these companies are non-union, workers do not have an organized voice and a place at the table, so wages and benefits can be slashed without much resistance from workers.

The Harvard Workers' Center prepared a report last October on outsourcing at Harvard University titled "Outsourcing, its Discontents, and some Solutions". The report identified that it is "always with the goal of cutting labor costs" that contracting out occurs and that "outsourcing benefits institutions primarily through weakening workplace rights and reducing wages and benefits."

The report found that at Harvard contracting out has resulted in the creation of two supervisory levels, Harvard and the company, that are "inefficient and possibly in violation of employment law." Outsourcing "divides workers into tiers which can be played against each other. At Harvard, management has used this strategy" to drive down wages in some areas. Contracting out "creates a dispensable, replaceable pool of workers who are easily exploited and can be used to drive down standards for other workers. Outsourcing creates loopholes which allow institutions to evade employment and labor laws."

One of the major problems with contracting out is that "outsourced workers demanding better compensation or working conditions can be 'permanently replaced' by Harvard without even any apparent legal conflict. The fact that Harvard University has no obligation to bargain with employees of contractors means that contract employees will find it difficult to pressure Harvard - their 'economic employer' on matters of compensation."

Our collective agreement states that "if the University decides to contract out work which will result in the lay off of bargaining unit employees it will, before it gives notice to employees, first give notice to and, if the Union requests, meet with the University to discuss the University's plans." (Article 2:04)

Contracting out turns the clock back on our rights. It attempts to eliminate hard-won gains such as fair wages, decent benefits, sick leave and vacations. Contracting out creates uncertainty about keeping decent jobs and replaces these jobs with McJobs. There is nothing lavish about employees wanting jobs that pay fair wages, provide good benefits and the security of knowing that they will be able to continue to pay their rent or mortgage and educate their children by keeping a good job. Europe is a good example of how the economy and society as a whole benefits when there are fewer have-nots. The trend to contracting out is part of an assault on the living standard of working people and is not in the interest of either employees or society as a whole.