Neo-Abolitionism: The case for abolishing the employer-employee contract in favour of workplace democracy – Fellows’ seminar by David Ellerman

25 February 2019

“Conventional liberalism implies the abolition of slavery, coverture marriage, and autocracy, and should also imply the abolition of the employment contract. This is a fundamental contradiction running through liberalism,” said David Ellerman, philosopher, political economist and mathematician, and currently Visiting Scholar in the Philosophy Department of the University of California at Riverside and the University of Ljubljana, Slovenia, and STIAS fellow.

“Liberalism is supposed to be about increasing individual choice. There is a deeper classical liberalism tradition developed through the democratic and abolitionist movements against the idea of a voluntary slavery contract – we need to recover that tradition,” he continued.

“I believe the same arguments can be applied to the employment contract.”

“As there is no actual transference of responsible human agency from the labour seller to the buyer, the contract to rent a person is legalised fraud on an institutional scale and should be abolished alongside coverture marriage and slavery contracts.”

“Classical liberalism frames the basic social/economic/political issue as: Coercion versus consent. But this is horrible intellectual history,” he continued. “Since Antiquity, the sophisticated defence of slavery and autocracy has been based on a voluntary contract (often ‘implied’). Slavery was justified as a voluntary plea bargain based on the practice of giving prisoners of war the choice of being killed or sold into slavery. Democratic classical liberalism developed counter-arguments against those contracts as being invalid and for the associated rights as being inalienable. Our first task is to recover that tradition that largely descends from the Reformation Doctrine of the Inalienability of Conscience through the Radical Enlightenment (conceived in Holland and Scotland) in the abolitionist and democratic movements.”

“But, once we have recovered the argument against the voluntary contract to sell oneself, I believe we find it also applies against the voluntary contract to hire or rent oneself out, i.e. the employment contract, the basis of our current economic system. Hence the name: Neo-Abolitionism.”

Ellerman - 1
STIAS fellow David Ellerman during his seminar presentation on 21 February 2019

Renting of persons

Ellerman described the employer-employee relationship as a controversial institution in the economic system.

“An employment contract from an economic viewpoint is the renting of a person (like the renting of a car),” he explained. “The employer is not buying the entity but buying the services of the entity for a specified period. The system is based on a voluntary contract and the selling of a limited amount of labour – unlike selling all labour which would be voluntary slavery.”

“All people who work in an enterprise are responsible for using the inputs and producing the outputs. But employees are not machines and there is no such thing as not being a responsible person. Responsibility cannot be transferred to an employer or voluntarily alienated.”

Ellerman used the examples of the Coverture Marriage Contract, the Voluntary Slavery Contract and Pactum subjectionis or government based on implied consent to advance his argument.

“In the Coverture Marriage Contract the independent legal personality of the wife was extinguished,” he said. “There is ordinarily a factual requirement of incapacity to have a person legally declared incompetent. However, married women under a coverture contract are not of diminished capacity so there are the legal effects of incapacity without the factual aspect — a legalised fraud. It has therefore been abolished over time in most countries although some vestiges remain.”

“In the Voluntary Slavery Contract the slave took on the legal status of a non-person but a person does not become a thing just by signing a contract. The contract is therefore a fraudulent mismatch between the legal and factual elements. The law said one thing but it differed in practice. This was particularly evident when a slave committed a crime. ‘Things’ cannot be held responsible, only persons.”

Pactum subjectionis referred to government based on implied consent. In democracy the social contract implies that sovereignty lies with the people and they delegate power to a leader but they never alienate that power. Similarly, you cannot alienate responsibility for your actions.”

“Personal contracts must be voluntary and non-fraudulent. These three types of contracts have been abolished over time on the basis that they place normally capacitated adults into a position of diminished capacity which is legalised fraud. If these have been abolished, so should the employment contract. The contract to rent out a person is invalid.”

“The theory of inalienable rights is violated by the renting of persons, the employer is not the delegate of the employees (both are responsible for the results of their joint actions), and modern natural rights or labour theory of private property imply that people should appropriate the (positive and negative) fruits of their labour (currently appropriated by the employer).”

“Responsible human action cannot be separated from the living worker,” he continued. “The alternative is that everyone is a member of the democratic entity where they work. People jointly work and govern themselves, and jointly appropriate the fruits of their labour in a genuine system of non-fraudulent market contracts.”

Ellerman indicated that there are some examples in practice of such worker co-operatives particularly in Spain and Italy.

“In the USA, some form of it exists as ten per cent of the US workforce are involved in employee stock-ownership plans,” he added. “But it may well be an obvious thing to do in South Africa – to include workers in the democratic ownership of companies.”

Ellerman is currently completing a book with the same title as his seminar while in residence at STIAS.

Michelle Galloway: Part-time media officer at STIAS
Photograph: Christoff Pauw


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