The Parallel Historical Path of Company and Labour Law

Frank Carrigan*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review


The paper explores the conceptual foundations of the legal principles that govern the operation of company and labour law. The paper argues that far from seeing the doctrinal architecture of company and labour law as a product of apolitical and objective rules a paradigm shift is required. The rule book conception of law is a misguided methodological framework. In sharp contrast to that methodology this paper avers the legal principles governing company and labour law must be viewed through the prism of the sovereignty of property rights. In effect, the viewpoint that law is an autonomous domain is eschewed in this paper. Instead the historical, social and economic forces directing legal developments in two crucial fields are illuminated. The upshot is a study illustrating the dialectical bond that exists between company and labour law. The paper is divided into three parts. The first part examines the way prescriptive law is the keystone of labour law. The role of the control test and implied terms are scrutinized in order to illuminate the way that the common law of employment facilitates the hegemony of managerial prerogatives. Apolitical legalism plays no role in this sphere of law. The second part considers the juridical forms that entrench the power of shareholders and managers in the modern company. In this sphere of law the courts sanction facilitative law by prioritizing the voluntarist assumptions of business people. The curve of legal reasoning in company law is dominated by the courts treating the leading personnel in companies as the personification of economic relations. The owners and administrators of capital are regarded as occupying the commanding heights of the economy, and are given judicial support to choose their own constitutional arrangements. Shareholders and directors are vested with a large degree of autonomy and discretion that is translated into the capacity to opt in and out of the regulatory web. The final part sums up the factors that underpin the triumph of the prescriptive and facilitative law that dominates labour and company law.

Original languageEnglish
Pages (from-to)19-48
Number of pages30
JournalLiverpool Law Review
Issue number1
Publication statusPublished - Apr 2011


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