Engaging with Flexibility and Security at the Company-Level: A Comparative Institutional Analysis Between Italy and Denmark

This paper explores the impact of collective bargaining over policies on flexibility and security at company level in the chemical and pharmaceutical sector, a major manufacturing industry that is highly exposed to international competition and characterised by a long history of collaboration between social partners. By focusing on collective bargaining in one sector of economic activity across two different countries, this paper makes a twofold contribution to present academic research. First, it sheds light on the role of sector and company-level actors and institutions in shaping regimes of flexibility and security (Burroni and Keune,2011). Second, it enlarges the scope of comparative institutional analysis beyond national level institutions (Ibsen and Mailand,2011; Marginson and Galetto,2013).

The selected countries for this comparative analysis are Italy and Denmark as they each answer to different industrial relations framework. A cross-national comparison between this countries helps understand how various international trends – such as employers’ search for flexibility and collective bargaining decentralisation – are mediated by national and sector-specific institutional arrangements providing for policies of flexibility and security within companies. It is argued that the two-tier bargaining system framing the chemical and the pharmaceutical sector in Italy and Denmark enables and constrains local level negotiations on issues of flexibility and security. Moreover, this study demonstrates that similar articulating mechanisms between the sector and the company-level limit the scope of cross-national variation in the way in which items of flexibility and security enter local bargaining agendas. (Marginson and Galetto,2013). Nevertheless, the scope of cross-company variation in the types of flexibility and security negotiated – and the variety of trade-offs between these – may well differ, as it depends on local actors’ capability to leverage on institutional resources given the sector and the firm-specific contingencies they face.

Crucially, due to their capital-intensive and knowledge-intensive productions processes, the global structure of their businesses – vertically integrated – and their highly differentiated product portfolio, all the manufacturing plants investigated represent ‘organisational fields’ (Edwards,2011) for social partners’ to adjust the headquarter requests for flexibility with compensating forms of security. This finding corroborates Pulignano and Keune’s study (2013) according to which low market competition, complex technology, and product differentiation positively influences workers’ structural power on the trade-offs between flexibility and security. Consistently, the outcomes of collective bargaining within and across the four companies investigated are interpreted as ‘balanced’ trade-offs between flexibility and security (Walton and McKersie,1965, Pulignano et al. 2104)

Thus, the multi-level nature of this research helps explore the different typologies of flexibility and security trade-offs conceived by sector-level social partners as a response to the institutional framework in which they are embedded. Moreover, it expands the debate to the implications that sector-level arrangements have at the company-level, when social partners bargain on similar issues. Finally, as institutions may enable and constrain policy choices, and yet never fully determine them, this research calls attention to the role of sub-sector contingencies and the way in which these interplay with the resources available to actors (Meardi and Marginson, 2009)