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You own a factory. Your employees don't. There's a power imbalance in the employment relationship. Most people (who don't own things like factories) need a reg

You own a factory. Your employees don't. There's a power imbalance in the employment relationship. Most people (who don't own things like factories) need a regular, predictable, stable income to survive, and finding new employment is not always easy. Therefore, people in most developed countries have agreed that by taking on an employee, it is contingent on the employer to provide some guarantee of stability. This is borne out by laws restricting firing in many cases, and requiring severance pay in the event. The USA is an aberration in this regard - even the workers seem to value the rights of the employers far above the rights of the employees. I'm not sure why this is.

louisswiss 6y ago
> even the workers seem to value the rights of the employers far above the rights of the employees. I'm not sure why this is. To paraphrase a famous quote, in the USA the workers don't see themselves as workers, but as temporarily down-on-their-luck owners.
- Naracion 6y ago
  Out of curiosity, what is the quote and whom is it by? (not trying to challenge you, just interested)
  - louisswiss 6y ago
    > “Socialism never took root in America because the poor see themselves not as an exploited proletariat but as temporarily embarrassed millionaires.” By Ronald Wright.
- dx87 6y ago
  That quote by Ronald Wright is actually paraphrasing part of a John Steinbeck book, where he's using it to describe people who wanted socialist governments, but were dissapointed that everyone ended up poor instead of a utopia where everyone has everything they need. It's funny how it started out as a criticism of people who think that the government should have more control of how businesses operate, but has been paraphrased so many times that it's now used as a way to criticise people who want to minimize government involvement in business.
- LegitShady 6y ago
  >To paraphrase a famous quote, in the USA the workers don't see themselves as workers, but as temporarily down-on-their-luck owners. It's hilarious applying it here, given the situation described was reversed. Your position is that the worker who doesn't own the factory should dictate what the factory owner should pay because of a power imbalance. Weird. Perhaps the issue is having difficulty telling the difference between workers and factory owners in general.
manigandham 6y ago
Nobody is stopping you from owning a factory. The workers are also free to leave anytime without any notice or responsibility to the employer. This is a flexible arrangement for both parties that focuses on individual freedom and responsibility. It also helps make it easy for entrepreneurs to start companies and create jobs in the US and is a direct reason why we don't see the same innovation in regulation-heavy regions.
- jashmatthews 6y ago
  Sweden and Germany, for example, are heavily regulated but have more innovation in terms of GDP% than the USA. If you're talking about why we don't see more visible commercial innovation from European countries then it's more about access to the enormous amounts of capital to build a big name startup like Uber etc. Nobody notices the legions of small bootstrapped or seed to profitable software businesses across the EU.
  - manigandham 6y ago
    How do you measure "innovation in terms of GDP"? I certainly don't see trillion-dollar world-changing companies like Google, Microsoft, Apple and Amazon coming from those regions. What small business could replicate the impact of Windows, or Gmail or the iPhone?
    - haneefmubarak 6y ago
      (not the parent) I would think that since innovation and growth (caused by innovative use of resources or increase in efficiency or novel products and services) in general should be relative to the population and its state to begin with, nominal GDP growth per annum would be a reasonable metric as a proxy for the wildly non-measurable "innovation in terms of GDP"; for reference, here's the data for 2018: USA: 2.9% Canada: 1.9% Sweden: 2.2% Norway: 1.3% Finland: 1.7% Denmark: 2.4% Germany: 1.5% France: 1.7% Ireland: 8.2% (not a typo, likely explained by expansion of business services from NA into EU) UK: 1.4% Portugal: 2.4% Italy: 0.8% Greece: 1.9% Spain: 2.4%
sgustard 6y ago
In return for these employee benefits, the employees make less money, and are less likely to be hired, since every mis-hire is a potentially fatal error for the business. The laws of economics are not magic and the costs have to go somewhere.
- kharak 6y ago
  I hear this claim often enough, but never seen related studies. Is getting hired in Germany more difficult, compared to the USA? And if so, can you attribute that to employee benefits?
  - CamperBob2 6y ago
    Is there a reason why risky, innovative startups tend to be formed here in the US, and not in Germany? You guys act like there's no downside to cradle-to-grave nannying of the labor force. There is.
    - kharak 6y ago
      Correlation and causation. If you claim that lesser employee protection causes more innovation, proof it. So far, this is merely a believe.
      - manigandham 6y ago
        The proof are the many valuable American companies making world-changing products used globally and constantly copied by many other nations with their own domestic clones.
        kharak 6y ago
        That is not a proof for the question. You seem invested in your believes and either don't know or care about scientific evidence to back them up. There is nothing more to gain here, have a good day.
matz1 6y ago
I consider this a downside, it makes it harder to become factory owner. You want to balance the power? Make it easier to be an employer, not hinder it.
- 2rsf 6y ago
  Here in Sweden we don't see it as making things harder for employers, but making them act in fairness. Swedish worker unions sees the success of the business as success of the employees and will help get there for example by fair to both sides collective agreements. This means for example that unreasonable demands from employees will be blocked, and if the employer needs to cut down employees cannot refuse.
  - mrkstu 6y ago
    But there is no inherent reason the business itself is the locus of responsibility to the worker (other than obvious things like worker safety on the job.) Why not, for instance, make the loss of a job be covered by saved union funds that are generated by the union as a whole? The only reason the business is tagged as the responsible party in Europe is historical cruft.
agensaequivocum 6y ago
> The USA is an aberration in this regard - even the workers seem to value the rights of the employers far above the rights of the employees. No one has a right to payment if they do not provide services.
- ryanbrunner 6y ago
  If it's specified in their employment contract, they absolutely do. A severance package is really at the root of it just something laid out in an employment contract that says that absent cause, an employer needs to compensate the employee for terminating the contract. Clauses like that are super common in all kinds of contracts. The main difference, of course, is that in countries that require this sort of thing, it's required - but requiring certain implicit terms in employment contracts is a regular thing in the U.S. as well - there's all kinds of regulations and case law on what sorts of employment contracts are valid. Saying that something like severance is a necessary requirement is a difference of degree, not of kind.
  - agensaequivocum 6y ago
    Yes I should have been more specific. If it is agreed to than yes the payment is due. But the government forcing it is unjust.
    - ryanbrunner 6y ago
      Are notice periods, minimum wages, and restricting discrimination on protected grounds unjust as well? All of those are forced onto employment contracts in the U.S. (if not explicitly, then implicitly) regardless of whether employees or employers want them to be.
  - unishark 6y ago
    if you need to get the other party to sign a contract granting you a contractual right, doesn't that rather make the above poster's larger point though? Especially since that contract is the place where the salary and work are agreed upon. If I don't have a right to force you to work for me as a servant, then I need to get you to agree to do it willingly via some kind of contract.
jklein11 6y ago
I understand the policy and I don't think it is an entirely unreasonable way to combat wealth inequality. The only point I was trying to make is that it feels disingenuous to be surprised a company has a say in the severance they pay. I do think there are a few places where this policy breaks down. For example, the additional transaction cost makes hiring decisions "stickier." I think this hurts the employee as well as the employer. I don't quite understand the power imbalance here. My employer requires my labor and I am willing to trade my labor for money. If I'm not happy with the arrangement I'm free to find someone else to trade with.
- jnbiche 6y ago
  > I don't quite understand the power imbalance here There's only a power imbalance if workers are prevented from organizing, or if they (for whatever reason) refuse to organize. Or if they workers are very easily replaceable. Obviously, if you're one of 200 workers, you can't negotiate evenly with the ownership as 1/200th of the company's workforce. Same goes if you're an unskilled worker who is easy to replace. However, even then, if you organize with all 200 of your co-workers, you are closer to a balance in negotiating power since it would be hard for said company to replace all 200 workers at once.
ekianjo 6y ago
> You own a factory. Your employees don't. There's a power imbalance in the employment relationship. You make it sound like employers are all fat rich people smoking cigars while everyone else is in a sweatshop. The reality is that 99% of businesses are very small in size (as in, one owner and very few employees) and it's often much more a partnership than the power imbalance you are talking about. Yet the same laws apply whether you deal with a 10 persons company of a 100000 persons one. https://www.oberlo.com/blog/small-business-statistics https://www.oberlo.com/blog/small-business-statistics
- JohnTHaller 6y ago
  More Americans work for large employers than small or mid-sized ones.
  - unishark 6y ago
    Is this stat still up to date? It changes drastically between booms and recessions. In some years small businesses have had far more employees. A fact which should affect policymaking as much as the ratio at any given point. Either way I'd expect fewer americans still work at large businesses than at small and mid-sized businesses combined.
  - manigandham 6y ago
    Not by a big margin. Around 47% of the workforce is employed by small businesses.
    - LunaSea 6y ago
      So that's a minority. And "small businesses" with fewer than 500 employees represent 99.7% of all businesses and yet they represent less than half the total workforce.
      - mrkstu 6y ago
        The issue of course is that more regulation makes it that much harder for small business to hire and over time forces more and more of the economy and the labor force into the arms of big business.

louisswiss 6y ago

> even the workers seem to value the rights of the employers far above the rights of the employees. I'm not sure why this is. To paraphrase a famous quote, in the USA the workers don't see themselves as workers, but as temporarily down-on-their-luck owners.

Naracion 6y ago
Out of curiosity, what is the quote and whom is it by? (not trying to challenge you, just interested)
- louisswiss 6y ago
  > “Socialism never took root in America because the poor see themselves not as an exploited proletariat but as temporarily embarrassed millionaires.” By Ronald Wright.
dx87 6y ago
That quote by Ronald Wright is actually paraphrasing part of a John Steinbeck book, where he's using it to describe people who wanted socialist governments, but were dissapointed that everyone ended up poor instead of a utopia where everyone has everything they need. It's funny how it started out as a criticism of people who think that the government should have more control of how businesses operate, but has been paraphrased so many times that it's now used as a way to criticise people who want to minimize government involvement in business.
LegitShady 6y ago
>To paraphrase a famous quote, in the USA the workers don't see themselves as workers, but as temporarily down-on-their-luck owners. It's hilarious applying it here, given the situation described was reversed. Your position is that the worker who doesn't own the factory should dictate what the factory owner should pay because of a power imbalance. Weird. Perhaps the issue is having difficulty telling the difference between workers and factory owners in general.

manigandham 6y ago

Nobody is stopping you from owning a factory. The workers are also free to leave anytime without any notice or responsibility to the employer. This is a flexible arrangement for both parties that focuses on individual freedom and responsibility. It also helps make it easy for entrepreneurs to start companies and create jobs in the US and is a direct reason why we don't see the same innovation in regulation-heavy regions.

jashmatthews 6y ago
Sweden and Germany, for example, are heavily regulated but have more innovation in terms of GDP% than the USA. If you're talking about why we don't see more visible commercial innovation from European countries then it's more about access to the enormous amounts of capital to build a big name startup like Uber etc. Nobody notices the legions of small bootstrapped or seed to profitable software businesses across the EU.
- manigandham 6y ago
  How do you measure "innovation in terms of GDP"? I certainly don't see trillion-dollar world-changing companies like Google, Microsoft, Apple and Amazon coming from those regions. What small business could replicate the impact of Windows, or Gmail or the iPhone?
  - haneefmubarak 6y ago
    (not the parent) I would think that since innovation and growth (caused by innovative use of resources or increase in efficiency or novel products and services) in general should be relative to the population and its state to begin with, nominal GDP growth per annum would be a reasonable metric as a proxy for the wildly non-measurable "innovation in terms of GDP"; for reference, here's the data for 2018: USA: 2.9% Canada: 1.9% Sweden: 2.2% Norway: 1.3% Finland: 1.7% Denmark: 2.4% Germany: 1.5% France: 1.7% Ireland: 8.2% (not a typo, likely explained by expansion of business services from NA into EU) UK: 1.4% Portugal: 2.4% Italy: 0.8% Greece: 1.9% Spain: 2.4%

sgustard 6y ago

In return for these employee benefits, the employees make less money, and are less likely to be hired, since every mis-hire is a potentially fatal error for the business. The laws of economics are not magic and the costs have to go somewhere.

kharak 6y ago
I hear this claim often enough, but never seen related studies. Is getting hired in Germany more difficult, compared to the USA? And if so, can you attribute that to employee benefits?
- CamperBob2 6y ago
  Is there a reason why risky, innovative startups tend to be formed here in the US, and not in Germany? You guys act like there's no downside to cradle-to-grave nannying of the labor force. There is.
  - kharak 6y ago
    Correlation and causation. If you claim that lesser employee protection causes more innovation, proof it. So far, this is merely a believe.
    - manigandham 6y ago
      The proof are the many valuable American companies making world-changing products used globally and constantly copied by many other nations with their own domestic clones.
      - kharak 6y ago
        That is not a proof for the question. You seem invested in your believes and either don't know or care about scientific evidence to back them up. There is nothing more to gain here, have a good day.

matz1 6y ago

I consider this a downside, it makes it harder to become factory owner. You want to balance the power? Make it easier to be an employer, not hinder it.

2rsf 6y ago
Here in Sweden we don't see it as making things harder for employers, but making them act in fairness. Swedish worker unions sees the success of the business as success of the employees and will help get there for example by fair to both sides collective agreements. This means for example that unreasonable demands from employees will be blocked, and if the employer needs to cut down employees cannot refuse.
- mrkstu 6y ago
  But there is no inherent reason the business itself is the locus of responsibility to the worker (other than obvious things like worker safety on the job.) Why not, for instance, make the loss of a job be covered by saved union funds that are generated by the union as a whole? The only reason the business is tagged as the responsible party in Europe is historical cruft.

agensaequivocum 6y ago

> The USA is an aberration in this regard - even the workers seem to value the rights of the employers far above the rights of the employees. No one has a right to payment if they do not provide services.

ryanbrunner 6y ago
If it's specified in their employment contract, they absolutely do. A severance package is really at the root of it just something laid out in an employment contract that says that absent cause, an employer needs to compensate the employee for terminating the contract. Clauses like that are super common in all kinds of contracts. The main difference, of course, is that in countries that require this sort of thing, it's required - but requiring certain implicit terms in employment contracts is a regular thing in the U.S. as well - there's all kinds of regulations and case law on what sorts of employment contracts are valid. Saying that something like severance is a necessary requirement is a difference of degree, not of kind.
- agensaequivocum 6y ago
  Yes I should have been more specific. If it is agreed to than yes the payment is due. But the government forcing it is unjust.
  - ryanbrunner 6y ago
    Are notice periods, minimum wages, and restricting discrimination on protected grounds unjust as well? All of those are forced onto employment contracts in the U.S. (if not explicitly, then implicitly) regardless of whether employees or employers want them to be.
- unishark 6y ago
  if you need to get the other party to sign a contract granting you a contractual right, doesn't that rather make the above poster's larger point though? Especially since that contract is the place where the salary and work are agreed upon. If I don't have a right to force you to work for me as a servant, then I need to get you to agree to do it willingly via some kind of contract.

jklein11 6y ago

I understand the policy and I don't think it is an entirely unreasonable way to combat wealth inequality. The only point I was trying to make is that it feels disingenuous to be surprised a company has a say in the severance they pay. I do think there are a few places where this policy breaks down. For example, the additional transaction cost makes hiring decisions "stickier." I think this hurts the employee as well as the employer. I don't quite understand the power imbalance here. My employer requires my labor and I am willing to trade my labor for money. If I'm not happy with the arrangement I'm free to find someone else to trade with.

jnbiche 6y ago
> I don't quite understand the power imbalance here There's only a power imbalance if workers are prevented from organizing, or if they (for whatever reason) refuse to organize. Or if they workers are very easily replaceable. Obviously, if you're one of 200 workers, you can't negotiate evenly with the ownership as 1/200th of the company's workforce. Same goes if you're an unskilled worker who is easy to replace. However, even then, if you organize with all 200 of your co-workers, you are closer to a balance in negotiating power since it would be hard for said company to replace all 200 workers at once.

ekianjo 6y ago

> You own a factory. Your employees don't. There's a power imbalance in the employment relationship. You make it sound like employers are all fat rich people smoking cigars while everyone else is in a sweatshop. The reality is that 99% of businesses are very small in size (as in, one owner and very few employees) and it's often much more a partnership than the power imbalance you are talking about. Yet the same laws apply whether you deal with a 10 persons company of a 100000 persons one. https://www.oberlo.com/blog/small-business-statistics https://www.oberlo.com/blog/small-business-statistics

JohnTHaller 6y ago
More Americans work for large employers than small or mid-sized ones.
- unishark 6y ago
  Is this stat still up to date? It changes drastically between booms and recessions. In some years small businesses have had far more employees. A fact which should affect policymaking as much as the ratio at any given point. Either way I'd expect fewer americans still work at large businesses than at small and mid-sized businesses combined.
- manigandham 6y ago
  Not by a big margin. Around 47% of the workforce is employed by small businesses.
  - LunaSea 6y ago
    So that's a minority. And "small businesses" with fewer than 500 employees represent 99.7% of all businesses and yet they represent less than half the total workforce.
    - mrkstu 6y ago
      The issue of course is that more regulation makes it that much harder for small business to hire and over time forces more and more of the economy and the labor force into the arms of big business.