REDIRECTING THE REGULATORY FOCUS OF LABOUR LAW – FROM THE CONTRACT TO THE ORGANIZATION? THE EXAMPLE OF NON-FINANCIAL REPORTING IN THE EU

In a wide sense, the paper deals with the shifting regulatory character of labour law (more particularly, labour-related regulation in a wider context). The paper strives to highlight how the effectiveness of labour law is increasingly related to the activation of market-based incentives for compliance and what kind of innovative regulatory mechanisms might support such aspirations. More concretely, a particular, EU-linked innovative ‘regulatory case study’ is conceptualized in a complex theoretical framework: the link between labour law and non-financial (‘social’) reporting. In this context, the paper analyses Directive 2014/95/EU on disclosure of non-financial and diversity information by certain large undertakings and groups amending the Accounting Directive 2013/34/EU both from the perspective of regulatory theories and labour law doctrine. The theoretical pillars of our analysis are rooted, among others, in the new governance, decentred regulation, reflexive law, regulated self-regulation and light-touch regulation literature. The paper also draws insights from the ‘law and economics’ study of labour law and attempts to relate all these regulatory theories to non-financial reporting in the context of labour law. The main goal of the contribution is to identify how these relatively new legal ‘channels’ might be able to bring new forces of compliance into labour law, and how the role of law is changing. The essence of associated EU-level (and national-level) legal developments is analysed in a theoretical context, with a broad view on the possible future of labour regulation. Even though these regulatory methods are still rather on the periphery of labour law (in strong intersections with other branches of law, such as company law), they have the potential to become more integral building blocks of a modern labour law architecture. These new regulatory methods can contribute to improved compliance with labour laws and can foster responsible, decent employment practices.