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I don't understand how anyone in the world accept such social contract of being laid off anytime for arbitrary reasons. If you create a company, you take care

• vasco 8y ago
  What about when people get comfortable and stop performing at initial levels. Or if you realize you have too much middle management?
  • _ph_ 8y ago
    If single employees fail to perform, they should eventually be let go - idealy after given the opportunity to fix their performance. The cancellation of a major project also might make a whole department obsolete. But a blanket lay-off of 10% of the work force for a company which claims to be healthy, that is quite employee-unfriendly.
    • deleted 8y ago
      [deleted]
  • skrebbel 8y ago
    Yeah, comfortable employees, we shouldn't have that. At my company I ensure that everyone is always borderline burned out!
    • unethical_ban 8y ago
      I think you're missing the point, with or without intention. "Comfortable" doesn't mean that they have a nice house and are happy with their life at work. Comfortable in this context means they no longer have any concern about their own job performance, knowing they have a "sure thing" and underperform in their duties.
      • skrebbel 8y ago
        Good point. But I wasn't responding to the GGP's central argument, only to the implication that it's bad when employees get too comfortable. In particular, I'm ranting against the use of the word "comfortable" for describing unmotivated/shitty employees. It's perfectly achievable to have a company that consists of people who are motivated, comfortable, and extremely productive. It's a ridiculous Americanism that the only way to motivate employees is by making them "uncomfortable" (eg through fear of losing their jobs, like your example, or through other means).
        • SamReidHughes 8y ago
          Well, there's a reason America has a higher standard of living than Europe.
          • pbhjpbhj 8y ago
            People in USA [I assume you mean] are happier and more fulfilled than those living in Europe?
            • SamReidHughes 8y ago
              The median American is richer than the median European (in basically any large country). The SpaceX employees that got laid off are going to get other jobs and continue making more money and having more money to spend than their European counterparts. Edit: A few reasons. One is that, since it's easier to switch jobs, good employees have more leverage. Another is that, since it's easier to fire bad employees, the expected value of a new employee is higher and you can afford to pay them more. I think a big part of American prosperity is a result of companies being able to fire people. It's probably the most important bit of employment non-regulation that this country has, and it's a big aspect in which America is more worker-friendly than European countries. Other missing regulations, like working hours limits, vacation time regulations, don't benefit workers as much (or at all).
          • ben_w 8y ago
  • Klover 8y ago
    If your employees are performing worse than initially, then what are you paying them training for? And getting more comfortable in their position should usually reduce friction around their job and have more experience, so they can do their job better..
• tanilama 8y ago
  It is not exclusionary. By capitalist logic, a company grows because it makes profit from the market, if a company can't do that or lose its source of investment, it needs to shrink or disappear. What you describe is more like a political entity, where the leader is elected and responsible for the welfare of his/her electorate, and if he/she fails to perform, he/she will get booted out. But that is not a company.
• Findeton 8y ago
  You're also hired for arbitrary reasons, so that makes it even.
• raquo 8y ago
  There's at-will employment model on one side, and the Japanese Salaryman model on the other side (low vs high loyalty). As usual, the sweet spot is somewhere in between the extremes.
  • fabianhjr 8y ago
    Where in that scale does a coop worker-owner fit?
    • vkou 8y ago
      It depends on how the co-op votes.
• nullifidian 8y ago
  >If you create a company, you take care of it and all of its members. Companies are not created to take care of their employees. They are created to make profit and/or accomplish a societal goal. If a company is non-profit then it's just the latter. As someone from a post-communist state, it's plainly obvious to me that people on average don't work as well as they could if the threat of termination does not exist. My parents told me anecdotes about their coworkers who were reading books on the job, even playing videogames, and that's in an aero-space design bureau in the 80ies, in less elite organizations systematic alcohol consumption by groups of employees on the job was not something to be surpised by. And that pattern repeats itself in many countries where employment is semi-guaranteed.
  • wolco 8y ago
    The threat of randomly being fired will cause many focused workers to change how they act. They stop trying to help each other, blame increases and internal politics dominates. If this continues the remaining employees try to hire new employees with a fatal flaw so when the next wave comes they will be the first out.
    • nullifidian 8y ago
      I'm not saying that N% layoff is a necessarily a good practice. My main objection was to the notion that companies are created to take care of the employees. To me it's the role of the state to take care of the people, the companies are here to be efficient for eveyone's benefit.
  • drieddust 8y ago
    Termination due to non-performance on the job is entirely different from at will termination which can hit a performer and non performer alike. You seems to imply employees are the resources to be used to achieve goals. I do not see an issue in this arrangement if Employees have the same negotiation power as the employer.
    • nullifidian 8y ago
• raverbashing 8y ago
  That's just being idealistic. Why would someone ever hire if they wouldn't be able to terminate the contract if it's ever needed? And this goes both ways, I do want to be able to quit (with a "short" notice) Other answers gave plenty of good reasons: employees underperform, projects change, companies close, etc It's a job, not a marriage, and even those are becoming shorter. Note I'm not proposing "at-will" employment, I don't think that is good as well (even if employers like it, I don't think it's good for overall labour relations)
  • alkonaut 8y ago
    There are placees where termination for arbitrary reasons doesn’t exist (see e.g Sweden). Those economies still seem competitive. If you lay off 10% because times are worse and there is less work, then interestingly you are more or less required to re-hire the same people when you hire again (typically that would be negotiated so you’d buy them out instead). The 10% you fire also has to be the 10% last hired, you can’t fire the 10% worst performing (again, this can be negotiated so firing an older underperforming hire quickly becomes very expensive - think 1-2 years salary or similar) Is this perfect? No. But it makes employers think hard about hiring for better or worse, and it means you plan far ahead to ensure you have enough work in bad times, and don’t go on a hiring spree in good times.
    • raverbashing 8y ago
      > see e.g Sweden). Those economies still seem competitive. That's what you get when you have a high qualified and restricted (in numbers) workforce. But let's see if it keeps being that way or it goes the way of France and Italy (So how's that idealistic view working out in their real estate market again?) Again, it's a job, not a marriage. Some stability and regulation is welcome, sure, but jobs for life don't exist anymore.
    • nullifidian 8y ago
      >arbitrary reasons doesn’t exist (see e.g Sweden) It's important to note that these countries (Sweden, Japan) with higher employee protections and guarantees are very different in terms of culture from the hyper-individualistic US. https://en.wikipedia.org/wiki/Law_of_Jante https://en.wikipedia.org/wiki/Law_of_Jante <- basically an invese of the American culture
• austenallred 8y ago
  That sounds like a fantastic way to make it too risky to ever hire anyone
  • mkio 8y ago
    In Germany you see things like a single person having to do all jobs at once at a Pizza Hut or only three people working at the same time in a supermarket. A lot of customer-facing businesses are insanely understaffed. If your employer doesn't hire enough coworkers for whatever reason, your life will be miserable.
    • jononor 8y ago
      Isnt there a maximum average hours of work around 40 a week in Germany?
      • ben_w 8y ago
        Sounds about right. EU Working Time Directive is something like 40 or 48, but my German isn’t good enough to read German law.
      • wongarsu 8y ago
        Yes, with a few exceptions it's restricted to a maximum of 8 hours a day on average (and 10 hours max), with 5 days a week. However, how much stress you can be exposed to in those 8 hours isn't mandated. You can run many businesses understaffed with fairly little impact if you are willing to regularly replace employees suffering from burnout [1] 1: https://en.wikipedia.org/wiki/Occupational_burnout https://en.wikipedia.org/wiki/Occupational_burnout
• techsin101 8y ago
  Doing that would make hiring very risky. And interviews would be a year long
  • nothrabannosir 8y ago
    Technically isn’t that what probation is? A very long interview?
• pavelrub 8y ago
  What would be the rationale behind that? This clearly places limitations on a company's ability to optimize for achieving its goals, and ultimately stifles innovation. At the very least the long term impact of those downsides needs to be incorporated into any sort of social calculus. Would you prefer to live in a world without Teslas or SpaceXs, as long as employees are "taken care" of by their companies? This isn't necessarily even a false dilemma - it's entirely conceivable that certain ventures would require some kind of a layoffs strategy in order to be successful. Nor is it indicative of anything being wrong with "the state of the company" as you claim, unless you define it as such. I find it entirely unconvincing that optimizing for "employee care" is overall more beneficial to humanity, including for the long term well being of the exact same employees and their families, than the alternative.
  • TheOtherHobbes 8y ago
    Why would it "stifle innovation"? Having to run a company sustainably should promote innovation. It may stifle impractical get-rich-quick strategies and customer scamming, but that's not a bad thing.
    • breatheoften 8y ago
      This is very true - a huge amount of 'business strategy innovation' centers not around how to find better product-market fit or how to efficiently produce excellent products but on how best to game predictable trends to funnel benefits of resource collection/human effort at scale into a smaller number of hands (owners, management and the biggest/earliest investors). The idea that upside potential of an organization's efforts can/should never make it into the workforce and the effort to ensure that it remain this way is extremely sad and corrupting and makes for a world where misaligned incentives and exploitation are much more likely than they 'should' be.
    • pavelrub 8y ago
      Because it removes degrees of freedom. If there are N ways to achieve goal X, and some of those ways include layoffs, then removing those ways from the space of possible strategies will reduce the probability of companies achieving X.
• thefounder 8y ago
  Unless the said companies are funded by government I don't understand why there would be a problem. As a CEO your job is to maximize the profit not to create a socialist enterprise. Why should I pay you if I no longer need your services? That being said I believe things could be done to make the transition easier for workers without hurting the company. For example announcing the layoffs in advance(i.e give a 4 months notice at least). This should be enough so that the workers can find another job.
  • tasssko 8y ago
    The problem here is you said I. Personally if anyone in my company fires someone because “I no longer need your services” will be fired for hiring someone permanent that needed firing. Also if they follow our hiring criteria we want them in other places. This across the board lay-off is a sign of some kind of corporate correction. My advice is to think of it that the people you manage work for the company not for you. Correction: you don’t need advice.
    • sokoloff 8y ago
      If you fire a permanent hire for doing that, presumably you then also need firing for making a permanent hire that needed firing...
      • tasssko 8y ago
        Well done ...
• pmontra 8y ago
  I used to work for a mobile phone operator in Europe, so no quick way to lay off people. After the startup phase they ended up with hundreds of people in the software/network department that they really didn't need anymore. Not there at least, as the focus moved from development to operations. Some people were moved to operations but (I spare you the technicalities) we eventually ended up in a separate company providing exactly the same services to the original one. Then we started to get incentives to quit. I left even before they reached that phase. They are still doing the same job with less and less people (I think they moved many jobs in cheaper eastern Europe countries.) The point is that sometimes you really need less people to do the job or you can find them in other places without affecting the final product or service. There is nothing that can prevent a company to do that, not even employee friendly European legislation.
  • isostatic 8y ago
    In the UK, if your job is genuinely no longer needed, you can be made redundant, with mimimal pay off and notice (Typically 1 month notice and a minimum of 1 week per year redundancy)
    • toyg 8y ago
      “Genuinely” being basically arbitrary. What you do is you move people from role X to Y then, shortly after, you say role Y is no longer needed.
      • celticninja 8y ago
        Nope, not how it works.
        • Milner08 8y ago
          Ehh, I've seen that happen in the UK, but only on the small scale. You cant do that if you're making 10% of the workforce redundant but if its one or two people you can. They moved them to a new role, gave them very little work to do and genuinely made them hate work, then after a year (I think they hoped they would have quit by then) the positions magically became redundant and they had a months notice. Safe to say I left that place of my own accord not long after.
• azernik 8y ago
  Note that, in this case, the workers are getting "a minimum of eight weeks’ pay and other benefits" - this kind of thing is sadly not mandatory, but it probably should be. Companies can suddenly not need a worker as business requirements change, but the entirety of the resulting insecurity and switching cost should not fall on the worker.
• unethical_ban 8y ago
  So cut from the top down, period? Cut the people with the vision and strategy of the company, until nothing but the assemblers and forklift drivers are left? I believe in worker rights, and the ability of a person to live in relative economic security. But should a company not EVER be able to restructure when it realizes it has too many workers, or too broad a mission? Is 2 months pay and medical not a decent send-off for workers who provide little value to a company? I wish healthcare were publicly provided, but besides that, if the alternative were for SpaceX to file bankruptcy or to go broke for lack of competent management, I'll take some laid off workers.
  • candiodari 8y ago
    It's funny how you assume there'a choice. Unemployment in Europe as a whole (including Eastern Europe) is ~20%. Depends on what/when exactly of course but it is. Government (non-productive by definition, by which I mean they don't add value, not that they're not useful) is easily half of the remainder. So Europe has 40% value-adding employees among the working age population, which is about half the total population, or 20%. In America it's actually better, close to 30%. Everywhere else it's much worse. In the Middle East, Africa, most of Asia it's at most 10%, and usually less than half that. That means that you could, not in 50 years when the robots have taken over, TODAY, kill 85% of the population and the net effect on the world would be ... nothing. GDP wouldn't drop by so much as a dollar. Today, 85% of all humans alive are useless for the economy (some are school children and will become useful, but you could assume that to be ~10% and you wouldn't be far off the mark). So for doing everything we do today, and for guaranteeing the future, we need around 25% of the human race. Everyone else is economically useless. Note that this figure has been dropping for 40%, and has been for essentially all of history, with only short blips where more of the human race is actually useful (like the 30 or so post-WWII years). Even 15% economically useful population, historically speaking, is actually high, not low. What I mean to say is that the neutral expectation should be that that number is going to drop, not rise. So: no, a company should not ever be able to restructure. Every month, every day, every second we can keep that number up by even a small amount gives use one more month, one more day, one more second of the society we currently have, where people are actually somewhat useful. The alternative, if you think it through, I'm sure you'll see, is war. Or to put it another way: we need these people to have a job much more than we need a few extra dollars of GDP.
• Erlich_Bachman 8y ago
  The point of a properly functioning capitalistic system is not that every employe will stay at the same company for the longest time possible. It is to have liquid labor force markets, which will make sure that both the companies can obtain (and replace when needed) the employees that match the company perfectly - and at the same time that every employee will easily find (and change when needed!) a matching workplace, one that best suits their (possibly continuously evolving) trade skills, ambitions, life circumstances, risk appetites etc. Also, > laid off anytime for arbitrary reasons They are not arbitrary by any stretch of the meaning of that word. There are business reasons, changed or evolved business goals or market conditions. Those are all real objective phenomena which play very important role in the life of a company, ignoring which would be very fundamentally detrimental for companies and for markets in general.
• kgwgk 8y ago
  Employees can also leave at anytime for arbitrary reasons.
  • johnchristopher 8y ago
    Employees rarely leave for "arbitrary" reasons.
    • SerialOwl 8y ago
      When I left my previous employer, the reason was absolutely arbitrary. The new one paid more. I didn't have to wait for the old company to not pay me the agreed upon salary, spend months offering them a "compensation improvement plan", and documenting their failure to follow it in fear that they might sue me for leaving for the "wrong" reason. It's amazing how people pretend at-will employment is somehow equal for both sides when only employees can actually terminate the employment at-will.
      • johnchristopher 8y ago
        > When I left my previous employer, the reason was absolutely arbitrary. The new one paid more. That is literally the inverse of what arbitrary means: existing or coming about seemingly at random or by chance or as a capricious and unreasonable act of will Now: > I didn't have to wait for the old company to not pay me the agreed upon salary, spend months offering them a "compensation improvement plan", and documenting their failure to follow it in fear that they might sue me for leaving for the "wrong" reason. It's amazing how people pretend at-will employment is somehow equal for both sides when only employees can actually terminate the employment at-will. Where I live you have (it's the law) to keep on working (and being paid for that work) for a certain number of weeks (depending on how long you have been working at that company). So the company can find a replacement, so you can wrap up things and pave the way for the transition. It's not rare that you can come up with an agreement that let you do that from home (because you are leaving on bad terms) or that the employee takes his vacant days or extra hours to fill up that period.
• totallybro 8y ago
  totally, bro...
• douglaswlance 8y ago
  Cutting top performers would result in disincentives that would reduce overall profitability. They cut the bottom 10% of weak performers because they weren't up to the standard.
• aristophenes 8y ago
  Two points in rebuttal. First, companies can expand more confidently if they know they can reduce more easily if they need to. It is more efficient for companies to be able to right-size themselves. Bolstering this point of view is that the USA has a 4% unemployment rate, which is about as low as you can get without things starting to break down. The US economy has been outperforming almost everyone too, creating more prosperity for more people, compared to countries with more restrictive controls over employment. Second, specific to SpaceX, they actually succeeded in making reusable rockets. They used to need to build a new rocket for every launch. Then they needed to build their reusable fleet up. Now they don’t need to build hardly any rockets. I think this is what success looks like for them right now. From this point of view a 10% reduction is pretty low, and is only so low because they still have even bigger plans.
  • the8472 8y ago
    > Bolstering this point of view is that the USA has a 4% unemployment rate As a counterpoint, Germany has much stronger employee protection laws and unions and has a comparable unemployment rate. That said, resizing is still possible there, it just has some lag.
    • Cardinal_ 8y ago
      Kinda off topic but job protection in Germany is such a joke it's almost fake news. Got terminated recently after 12 months for no reason, filed for unfair dismissal, won the case. 3000 eur is what I got (lawyer fees 1500). You can be fired for very little cost, it's dangerous to think you're protected.
      • JanSt 8y ago
        The longer you are with your employer, the longer the protection. You should also receive Arbeitslosengeld I for at least 6 months (longer if you would‘ve been employed longer) and unlimited time of Arbeitslosengeld II (I think you would qualify), so you won‘t be homeless, freeze, lose your health insurance nor hunger, because it‘s all payed for by social security.
• marcoperaza 8y ago
  Freedom to fire enhances the willingness to hire. There’s a balance to be found, but if you make it impossible to get rid of employees you no longer want, you end up with an anemic labor market, like Europe’s. Barriers to firing also make it harder to justify hiring higher-risk candidates (e.g. former felons, high school dropouts).
  • anticensor 8y ago
    Hard-to-fire markets also have necessary laws to promote hiring former felons, old age and disabilities.
• Rainymood 8y ago
  >laid off anytime for arbitrary reasons. You can also leave for any arbitrary reason, anything else is slavery, simply put. This goes both ways. >If you create a company, you take care of it and all of its members. If you create a company, you have a fiduciary duty towards your shareholders. A company only exist when it is profitable (either now or in the future) and it can only continue to exist if it can do so profitably. Companies don't exist to "take care of its members", those are what unions are for ... oh ... wait ... >Will the 10% of the employees be the ones who are already in the less comfortable financial and social situation in their private life ? How is this even relevant? You provide a service to the company and they pay you for it, they can decide not to do business with you and vice versa. Empathy has little to no place in business, unless it generates more profit of course.
  • benjaminsuch 8y ago
    "...anything else is slavery" What?
    • Rainymood 8y ago
      If you are in any non-voluntary way forced to stay with the company and you can't leave. For example foreign workers that do labour intensive work where their housing is being taken care of by the employer in an exploitative way, they can't quit working because their employer is in charge of their housing, etc.
  • adwn 8y ago
    > You can also leave for any arbitrary reason, anything else is slavery, simply put. Being a slave entails more than just having to fulfill your voluntarily agreed-to, contractual obligations. Using the term "slavery" for this trivializes actual slavery – i.e., ownership over a human being.
• alan-crowe 8y ago
  There is a bigger picture in which employers intermediate between producers and consumers. As a consumer, you are free to shop around. You bought a Ford, but perhaps next time you buy a Honda. If the government is really serious about saying that Ford cannot lay off workers, the government has to help. For example, by introducing a tax on importing Hondas. In the big picture, your job security as a producer trades-off against your right to be a disloyal consumer.
• matz1 8y ago
  Because it's also suck to not able to fire your employee for any reason. A company purpose is to make money, not to take care its member. Its the government job to take care of its citizen. Using basic income, universal health care, cheap/free housing, etc.
• twodave 8y ago
  So companies should be required to keep their low-performers indefinitely? That sounds like a recipe for getting 100% of your work force laid off to me... of course we don’t know the motive behind the layoffs so I guess we are both making some assumptions.
• kerbalspacepro 8y ago
  >If you create a company, you take care of it and all of its members. No. A company doesn't have members, it has employees. Americans should know by now that a company has no loyalty to them and they should have no loyalty to the company. If they don't know this, it is their fault for being naive (or a Boomer).