Employer Association Governability and Training Levy. Lesson from the 2014 Reform of the French Further Training System
Our research questions are the following one: To what extent training levy might increase the governability of employer associations? Do employer organisations really search for such organisational resources? These are precisely the questions asked by Franz Traxler in an article published in the European journal of political research (Traxler 2010). In his article, Traxler discards the idea that external resources related to corporatist institutions might increase the governability of employer associations over their large firm members. In our communication, we will question these findings through the case of the French SME confederations and their attachment to training levy.
For that purpose, the paper/communication is divided in four parts.
In the first part, we outline the importance of external resources in the neo-corporatist political exchange between the state and intermediary organisations, and we explain how training levies provide employer associations with neo-corporatist external resources (Pizzorno 1978). We show then the kinds of resources training levy provides.
In the second part, we will discuss the logic of employer collective action by sketching out the debate in the German-speaking sociologist literature (Offe and Wiesenthal 1980, Streek and Schmitter 1999, Traxler 1993). Franz Traxler pointed out that there is a class dimension in the way collective action is organised. Unlike trade unions, employer collective action is technically easier since it may rely upon the huge resources of large firms. But it has political implications because one consequence is the intra-associational domination of large firms.
In a more recent paper on employer collective action and neo-corporatism, Traxler minimises nevertheless the relevance of a second concept put forwards by certain scholars on collective action and neo-corporatism, that is, the concept of ‘organisational development’ (Streeck and Schmitter, 1985). According to Traxler, external resources the main employer organisations are granted by political exchanges with public authorities cannot be seen as an attempt to increase their governability. The remainder of our paper questions and qualifies the picture Traxler draws regarding the impact of external resources on employer organisations’ governability. One first step consists in distinguishing two dimensions of governability: the ability to discipline firm members during the implementation of corporatist policies (ex post governability) and the capacity of employer organisations to express positions during collective bargaining and/or policy setting up that do not comply with the interests of their most powerful members (ex ante governability). Because the former has already been invalided by previous works on vocational training (Soskice 1994, Culpepper 2003), we pay attention to the latter dimension of governability.
To do so, we then scrutinise the employer association in France and their preferences towards the suppression of training levy proposed during the 2013 collective bargaining on further training. Summing up, part of our findings is consistent with Traxler’s view in that training levy does not seem very strategic for Medef’s organisational interests and because the huge external resources provided by the neo-corporatist governance of training levy did not undermine the intra-associational domination of large firms. Indeed, the large firms from the metalworking and the bank/insurance sectors, but also the board of Medef actively promoted the abolition of the training levy. However, our analysis of the French employer interest intermediation system and the reform of the further training system lead us to the conclusion that external resources are strategic for the governability of SME associations. Indeed, despite the threat of defection of its main members, the metalworking employer association UIMM, the board of CGPME refused to sign the agreement and engaged a huge but unsuccessful lobbying against the abolition of training levy. That shows the importance of external resources related to training levy for the SME association, and also how it enables CGPME to contest the interests of its most powerful financial contributors.
Why should one give much credit to a study on the governability of SME employer organisations whereas large firm-dominated employer associations are usually the principal ones in European political economies? Well, beyond the fact that SME associations has much to say about collective action, SME employer organisations’ powerfulness – and thus their capacity to gain access to (neo-corporatist) external resources – has implication for the study of institutional change in European countries in several aspects. Firstly, contemporary developed economies are characterised by the overall rise of business power (Scharpf and Schmidt 2000; Hacker and Pierson 2002). That means that employer collective action has more impact on institutional change than in the post-World-War II period. Secondly, the contemporary period is also marked by increasing tensions between export-oriented large firms and domestic-oriented small-sized companies (Thelen 2003; Cognard 2013). Thirdly, in this context and owing to the decline of membership, SME associations are likely to prefer a logic of influence over the logic of members, by for instance trying to insurance their access to corporatist resources and adopt conservative strategy in certain policy field. Finally, the power of SME representative organisations matters because in the divided European societies, institutional change is driven by cross-class coalitions between a more disorganised labour and an already fragmented employer side (Thelen and Busemeyer 2012; Busemeyer, 2012). However, the very much opportunity for SME associations to enter in effective alliances with a part of trade unions relies upon their own powerfulness and thus the additional organisational resources they may obtain.