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The Law of Work
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Canada's Income Inequality Continues to Grow

by David Doorey October 21, 2008
written by David Doorey October 21, 2008

A recently released study by the OECD found that Canada ranks 18th among developed countries in terms of income inequality:

In the last 10 years, the rich have been getting richer leaving both middle and poorer income classes behind.  The rich in Canada are particularly rich compared to their counterparts on other countries..  Canada spends less on cash benefits such as unemployment benefits and family benefits than most OECD countries.  Partly as a result, taxes and transfers do not reduce inequality by as much as in many other countries.  Furthermore, their effect on inequality has been declining over time.  Over the past 10 years poverty (people who live on less than half median incomes) has increased for all groups… to an overall rate of 12%.

There are lots of reasons for this embarrassing result.  What reasons can you think of?
One issue often debated is the extent to which there is a relationship between unionization rates and income inequality.  Since unions tend to raise wages of workers, we might predict that strong unions equals less income inequality.   For example, check out this study using Canadian, U.S., and UK date.    
Take a look at the rough correlation between countries with high unionization rates and low income inequality.  Using quick stats I took from this article by Blanchflower, the top ten countries on the list (countries with the lowest income inequality), include these (listing those I have stats for in the article):  
1.  Denmark (union density, 2003: 70%)
2.  Sweden   (2000, 80%)
3.   Austria  (2003, 38%)
7.    Finland  (2003, 74%)
8.    Belgium (2002, 55%)
Canada, on the other hand, at 18 on the list, has a unionization rate around 28% (2003).  Other notable bottom feeders:
 

     19.  Spain  (2003, 16%)
     23.  New Zealand (2002, 22%)
     24.  U.K.    (2003, 29%)
     25.   Italy   (2003, 34%)
     27.  U.S.A. (2003, 12%) 

We need to be cautious doing direct comparisons of unionization rates across countries, because the systems for measuring are not always the same.  Still, this is an interesting question for policy, since most of our current conservative governments in Canada are adamantly opposed to collective bargaining.  If collective bargaining decreases the gap between rich and poor, should our governments be doing more to increase the union density rate in Canada?

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David Doorey

Professor Doorey is an Associate Professor of Work Law and Industrial Relations at York University. He is Academic Director of Osgoode Hall Law School’s executive LLM Program in Labour and Employment Law and a Senior Research Associate at Harvard Law School’s Labor and Worklife Program. Professor Doorey is a graduate of Osgoode Hall Law School (LL.B., Ph.D), London School of Economics (LLM Labour Law), and the University of Toronto (B.A., M.I.R.).

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TheLawofWorkDavid J. Doorey🇨🇦@TheLawofWork·
14h

Here’s Michael Lynk piece from my Law of Work blog:

https://lawofwork.ca/academic-freedom-and-labour-law-in-canada/

The context in Canada is that most profs are unionized, covered by collective agreement ‘just cause’ clauses, & discipline is decided applying just cause principles, accounting for context of work site.

Liam McHugh-Russell@LMcHugh_Russell

So @TheLawofWork has said tenure is just the protection you get in most unionized workplaces-- against all but just cause dismissal--except you wait 6 years to know whether you get it. I feel this misses something. Any writing on the lives of "tenure" as legal category?

Reply on Twitter 1527785033318244352Retweet on Twitter 1527785033318244352Like on Twitter 15277850333182443521Twitter 1527785033318244352
TheLawofWorkDavid J. Doorey🇨🇦@TheLawofWork·
14h

I think Michael Lynk has written on this topic?

Question I asked is what’s the substantive difference in terms of protection from discipline between ‘tenure’ and ‘just cause’ in arbitration case law. Tenured profs have other entitlements (serving in some positions, etc).

Liam McHugh-Russell@LMcHugh_Russell

So @TheLawofWork has said tenure is just the protection you get in most unionized workplaces-- against all but just cause dismissal--except you wait 6 years to know whether you get it. I feel this misses something. Any writing on the lives of "tenure" as legal category?

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TheLawofWorkDavid J. Doorey🇨🇦@TheLawofWork·
15h

Congratulations to one of my oldest and best friends from many moons ago, Stephanie Vaccari, for winning Managing Partner of the Year, @BakerMcKenzieCa.

Always knew great things were in store.

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