Sub-National Governance of Industrial Relations and the Chances of Union Revitalization. Evidence from Italian Shopping Malls.

Traditional industrial relations institutions as unions and collective bargaining are less and less diffused in innovative workplaces, giving credit to convergence theory illustrating a neo-liberal trajectory along which work regulation is increasingly set unilaterally by firms (Baccaro and Howell 2011).  To examine and discuss what underlies this trajectory, its drivers and inexorability, this article focuses on unions' inclusion or exclusion from regulatory processes regarding shopping malls known as Factory Outlet Malls, namely huge multi-employers retailing complexes with almost one thousand workers, mostly shop assistants. Such workplaces are particularly challenging for traditional industrial relations institutions because their features (a greenfield site fragmented into several micro-firms, a young workforce experiencing high turnover) are usually associated to workers' under-representation (Grugulis and Bozkurt 2011; Ikeler 2011). But the context matters too, and here Italy is particularly intriguing: first, it allows to test the resilience and adaptability of a relatively 'organized' system of industrial relations facing new challenges; second, while major labor laws remain nationally embedded, the Italian legal framework on retailing has been extensively reformed in 1998 and 2001, moving several competences from the national to the sub-national level (Regions, municipalities); third, Factory Outlet Malls arrived in Italy exactly in 2000, followed by other twenty-five cases. For these reasons, this research brings original materials to the long-standing research tradition on Italian sub-national patterns of industrial relations (Locke 1992; Regini 1995; Trigilia and Burroni 2009) and contributes to the timely debate on multi- and sub-national governance of social and economic policies (Keune and Marginson: 2013; Sase 2016).

     The working hypothesis is that innovative businesses rely on new ways to coordinate socio-economic activities that, challenging the old features of regulation, allow the first-mover to act as a rent-seeker, unless involved entrepreneurs, politicians and unionists reach a new compromise. So there are two kinds of actors, 'first-mover' and 'subordinate', and three kinds of actions, unilateral, negotiated and cooperative. In this research, first-movers are entrepreneurs, who promote and develop retailing complexes such as Factory Outlet Malls, but also local governments, which hold the legal authority to give planning permissions and retailing licenses to make them operate. Instead subordinate actors are the unions, firstly concerned about how to reply to first-movers' strategies to gain their recognition and affect the regulation of the retailing complexes. Within this framework, fieldwork focused on industrial relations dynamics in the eight Factory Outlet Malls evenly present in four Italian regions - Tuscany, Emilia Romagna, Lombardy and Veneto - since 2000 until 2015. The four Regions display two basic differences: the first regards the institutional architecture of the policy-making in retailing, whose barycenter lies at the central level in Tuscany and Lombardy, whereas at the local level in Emilia Romagna and Veneto; the second regards the political sub-cultures dominant in these areas, with Tuscany and Emilia Romagna always administered by leftist and progressive forces, and Lombardy and Veneto by moderate and conservative forces. These two factors, one structural and another ideological, produce four types of governance: 'neo-corporative' (Tuscany), 'social dialogue' (Emilia Romagna), 'pluralist' (Lombardy), 'conservative' (Veneto). Thanks to an extended review of policy documents, court rulings, local newspapers and forty interviews to key-informants, this research aims to clarify the effect of different types of governance on industrial relations institutions.

     Clear findings emerge from the empirical analysis. Whenever the policy-making in retailing is decentralized at the local level, employers and local administrators join together to exclude the unions from work regulation, regardless of the dominant political subculture. On the contrary, when the policy-making is controlled centrally, such as by regional policy-makers or judges, the regulatory process allows cooperative or negotiated solutions inclusive of all the industrial relations actors, unless the state is ideologically hostile to the unions. A straightforward demonstration comes from the Sunday openings issue, whose legal framework varies sub-nationally. In some cases, the management imposed to the workforce these openings thanks to an 'institutional loophole' (Benassi et al. forthcoming) created by the local government: the entitlement of 'touristic city', which comes along with an extremely loose legislation on retailing. In other cases, management and unions regulated these openings through an institutional experimentation, collective bargaining at the 'site' level, where the workers' counterpart is the property owner of the mall, rather than the legal employer, the tenant shopkeeper. Here the deal is signed because the unions accept a flexible working time arrangement in return for compensations like a wage increase, training courses, an office for the union local branch. Further confirming the consistency of these results, this institutional experimentation halted only when a national government with an anti-union agenda interfered, as done in 2011 by Monti's liberalization of the retailing sector, which repealed all the constraints on shop opening hours previously introduced by some Regions.

     Exploring the industrial relations dynamics in Italian Factory Outlet Malls, this article contributes to the timely debate regarding institutional change and sub-national governance of work and employment regulation. Among the four types of sub-national governance under the spotlight, three - neo-corporatist, pluralist, conservative - appear in line with their institutional paths. Vice versa, the one inspired to 'social dialogue' is experiencing an institutional change, being unable to meet its labor-friendly expectations. Besides, the research illustrates that union revitalization and the regeneration of traditional industrial relations institutions are possible even where least expected, in fragmented workplaces of the low-end service economy. This article explains why institutional experimentation took place in some shopping malls and not in others, delivering two arguments about the social and economic governance of industrial relations. First, a certain degree of centralization and an attitude at least not openly hostile to unions are two necessary conditions for the regeneration of industrial relations institutions, while a decentralized institutional structure and an anti-union ideology are both sufficient conditions to prevent the reproduction of traditional industrial relations institutions. Second, the pivotal actor is the state, whose interplay among the national, regional and local levels substantiates the above-mentioned structural and ideological factors underpinning the multi-level governance of industrial relations.