8 ms·

Google and Amazon Struggle to Lay Off Workers in Europe Due to Labor Laws

83 points by helsinkiandrew 4y ago

helsinkiandrew 4y ago
https://archive.ph/x2OGn https://archive.ph/x2OGn
ibnbutlAn 4y ago
EU labor laws protect the workers. I dont get why US Americans often think these laws dont benefit the workers.
- nostrademons 4y ago
  They level out both the upside and the downside. If you can never fire people, you're going to be very very cautious about who you hire in the first place. That makes it much harder to get companies into a bidding war that'll actually raise your wages. I've had a few European teammates, and they usually come to the U.S. because they can make 3-5x what they could in Europe. You'll see that a lot in HN comments, where people talk about USD$400K FAANG compensation and European developers will be like "Dang, WTF, I'm just sitting here with my €70K salary". Right now, going into a bust, everybody wants downside protection. You often make more over the long-term accepting some risk to pick the upside when it's available, though.
  - throwawaymanbot 4y ago
    [dead]
  - regularjack 4y ago
    You're assuming that the differences in wages between US and Europe are solely due to labor laws, which is quite a stretch, in my opinion.
    - aix1 4y ago
      I think it's interesting to compare Switzerland with the neighbouring countries (e.g. France and Germany). I don't know about other companies, but Google Zürich pays much more than Google Paris or Google Berlin/Munich. I think it's likely that the difference in labour laws is a contributing factor. Switzerland has very little by way of worker protection, instead placing a significant emphasis on unemployment insurance (Arbeitslosenversicherung).
      - mrunkel 4y ago
        Cost of Living is much higher in Switzerland.
        nostrademons 4y ago
        Cost of living is usually higher in areas with higher wages, because it means that residents have more money to spend on living.
        aix1 4y ago
        Right, and Google explicitly doesn't model for cost of living in its comp philosophy.
        waych 4y ago
        They use per market pricing instead, which roughly works out to the same thing in the long term, while not being subject to short term fluctuations.
    - twelve40 4y ago
      I don't see the "assuming... solely" in their post at all. Seems like they are just pointing out a factor, could be one of many.
    - dumpsterdiver 4y ago
      Where did they make that assumption at all? How does the parent commenter acknowledging a single factor in a situation lead you to believe that they assume no other contributing factors exist?
  - hsjqllzlfkf 4y ago
    > I've had a few European teammates, and they usually come to the U.S. because they can make 3-5x what they could in Europe. And as we know, the only difference between us and Europe is labor laws. /s
    - TexanFeller 4y ago
      I've worked with many UK/Europeans. They are quite similar to us in skills and productivity aside from labor laws(excessive vacations, months/years of parental leave, impossible to fire etc.)
      - wdb 4y ago
        Excessive vacations? What do you mean? It's not impossible to fire you only need a good cause to do so which I find reasonable.
        TexanFeller 4y ago
        A good reason that often doesn't qualify is that business is down, macroeconomic conditions are expected to be unfavorable for the foreseeable future, and expenses, which for many businesses are dominated by salaries, need to be cut ASAP to ensure the business' long term survival and prosperity. Like now. Businesses in Europe simply have fewer options, like it's much harder to cut early and cut deep(hopefully minimizing future cuts) when trouble is ahead when you have to have protracted negotiations with unions and government agencies who have to sign off on your layoffs.
        kramerger 4y ago
        Union negotiations are about how to organise the layoffs, not whether you can fire the workforce or not. And if you expect help from the government, you need to show that your layoffs actually have a chance to make your company survive. For example, you cannot fire the entire R&D when you are 1 year from product release.
      - pleb_nz 4y ago
  - future_i_snow 4y ago
    I make almost exactly €70k in Sweden and I am _very_ happy not making more since I also have very very cheap universal health care, and very very few mass shootings in the public schools my children are attending.
- JPLeRouzic 4y ago
  I am not sure, at least for France, that it's "all workers". For example the "code du travail" is excessively complex as it describes many kind of different private sector workers with very different rights. As a rule of thumb if you work in a large company you are well protected. In other cases it's very different, which partly explains the violence in the society.
  - cutemonster 4y ago
    > partly explains the violence in the society What's that about? Could you please explain?
- TechBro8615 4y ago
  Well, the salaries are about 30-50% what they are in the US. Maybe it's related.
  - hsjqllzlfkf 4y ago
    Maybe it's related, maybe it's due to the fact that the cost of almost everything in the US is higher. There's many factors in this conversation
    - TechBro8615 4y ago
      So companies just pay you out of the goodness of their heart because you need the money?
      - hsjqllzlfkf 4y ago
        I have no idea how you know from what I said to that. All I said is that available data does not allow you to conclude that the entirety of the difference in pay is due to difference in labor laws. It's not an extraordinary claim, it's quite tame in fact, I would self evident.
    - TexanFeller 4y ago
      > the cost of almost everything in the US is higher Certainly not compared to Europe/UK. I have friends that moved there and have spent many weeks over there myself. Property, living expenses, taxes, and many goods are generally noticeably higher over there.
      - cr1895 4y ago
        To counter your anecdote with mine, I’m always shocked whenever I return to visit the US how expensive basic things like groceries and rent are. Much more so than the Netherlands. This is complicated, and it’s insufficient just to state that everything in Europe is generally more expensive than in the US.
- refurb 4y ago
  Just like rent control does more than just "control the price of rent" because landlords change their behavior to optimize their financial returns, so do labor laws. Strong worker protection ends up making the cost of hiring new workers higher. Companies react to those costs by a number of means like delaying hiring, hiring contractors first, firing within the probation period when they might not have normally, etc, etc. Whenever the laws are changed, a new "optimum approach" is developed. And like rent control, labor laws often benefit the people who already rent/have a job. For people who are looking to rent/looking for a job, they can make it harder as the barriers to entry just got higher. It's not right or wrong, it's just a trade off.
  - dantheman 4y ago
    There's definitely a right and wrong - it is morally wrong to use force to enrich yourself at the expense of others. In the case of rent control -- landlords and future renters suffer. In the case the employment -- it's employers and future workers.
    - em-bee 4y ago
      how does rentcontrol let future renters suffer?
      - refurb 4y ago
        If, as a landlord, you know you can never raise the rent, and you can't evict a tenant except for very limited reasons, well then you have your own internal set of screening criteria and you only take the most qualified renters. It's far better to leave the unit empty for a few months because the loss of rental income is tiny compared to the financial loss of choosing the wrong tenant.
        em-bee 4y ago
        i see your point but i don't think this is true. i believe that bad tenants are uncommon but exist at all price levels. raising rent is not going to keep them out and they will have to be screened anyways. i don't know how rentcontrol works elsewhere, but in germany generally it means that rent can't be raised more than once a year or 15 months or something in that range, and it can't be raised more than a few percent each time, but it doesn't mean that it can't be raised at all. not being able to evict a tenant is independent of that. the general issue here is a power differential. big company vs small family. i know in the US there are more small landlords who only have a few houses or even one. but that is rare in germany. most are bigger businesses with hundreds of apartments, and with that the risk of getting a bad tenant is obviously larger, but the financial risk is also spread over all tenants.
- bjoli 4y ago
  I think it is because it benefits workers differently. People with high salaries would usually get even higher salaries in the states, whereas people with low-earning jobs would get less paid with a less stable employment. The HN selection is just skewed. A friend of mine with a VERY sick disabled kid which prevented her from working night shifts in a home for the elderly would probably have gotten sacked by now hadn't it been for the Swedish labour laws that mandate that the employer tries to find a different position within the same qualifications in the same organisation. Sure, the union had to help and remind them of that obligation, but in the end it worked out for the best for my friend. I don't think the laws are there to protect someone like me that could get another job, but to protect people like my friend.
- TexanFeller 4y ago
  Strong worker protections are a major reason that big tech and many other industries have a much smaller presence in Europe and pay far less to Europeans. You're worth less if you might be absent on parental leave for a year at a time. You're higher risk to hire if you can't be fired easily etc. Protections have a cost. My friends that moved to UK/Europe get half their former salary and have much higher living expenses and taxes. I also have several friends that moved to TX because compensation in Europe is terrible.
  - dingusdew 4y ago
    [dead]
  - WeylandYutani 4y ago
    It all depends on what you value. Dutch labour laws are not written for highly educated tech bros but designed to protect everyone. Wealth inequality for instance is something that permeates political discourse. Americans don't give a shit about it at all. Making society nicer for everyone and not leaving anyone behind.
    - dantheman 4y ago
      Making society nicer for everyone requires investment.
      - smcleod 4y ago
        * in people, not profits.
    - throwaway6734 4y ago
      >Making society nicer for everyone and not leaving anyone behind. In the short term, Europe is much better at this than the US, but the long term sustainability of the European welfare state will be under serious threat over the next 50 years due to the horrible demographics of most European countries
- throwaway22032 4y ago
  I am British. If you need labour laws beyond basic safety stuff then you're simply not being paid enough. I would far rather have sufficient income and therefore wealth built to be able to choose for myself whether I want to take time off. I actually find it juvenile that people want employment to be this way. What do they think is going to happen when they stop working? Or is the plan - again a juvenile one, seeking a parental figure - "I'll just work for a company until I die"? Have fun with that...
- tripleaaa 4y ago
  [dead]
palata 4y ago
Mouaha.
deleted 4y ago
[deleted]
bluedino 4y ago
Will this potentially make these employers more hesitant in the future to hire in countries where they will have a harder time letting them go?
- deleted 4y ago
  [deleted]
- shagie 4y ago
  The Employment of the Low-Skilled Youth in France - https://docs.iza.org/pp64.pdf https://docs.iza.org/pp64.pdf > Youth unemployment is notoriously high in France, in particular for the low-skilled. Within the EU, only the crisis countries of Southern Europe fare worse. This report delivered to the French Council of Economic Analysis analyzes the causes and consequences of this alarming trend. In addition, drawing on the available evidence on various measures that could improve the current situation, concrete policies proposals are derived that cover the areas of vocational education, second chance programs, job search assistance, income support, employment subsidies and dismissal protection. Why Is Unemployment in France So High? - https://www.elibrary.imf.org/display/book/9781557754912/ch01.xml https://www.elibrary.imf.org/display/book/9781557754912/ch01... > With regard to the demand-side causes of long-term unemployment, employers faced with continued uncertainty about future orders may refrain from recruitment for long periods of time, causing the persistence of both unemployment and long-term unemployment, particularly if wages are not flexible. Labor market rigidities, such as the relative generosity of long-term benefits, employment protection legislation, the minimum wage, and high employer costs are other potential contributory factors. > ... > The 1986 work dismissal legislation in France requires that those being dismissed are given one to two months’ written notice of dismissal and informed in writing of the reasons for their dismissal. At the same time this legislation removed the need to seek the permission of the Labor Ministry for collective dismissals. Other legislation in 1989 obliged companies to prove the cause of dismissal. The law in France also requires that workers be paid up to a maximum of one and a half months’ salary as severance pay. Though the legal restrictions on dismissal in France are less strict than those in the southern European countries, they are more strict than those outside Europe, particularly in the United States.
fooofw 4y ago
Is there anywhere I can learn more about these regulations and what are the differences between different European countries? What Bloomberg writes here is not so concrete beyond requirements for consultations". Are you really not allowed to lay people off to save money?
- tmpaccountt 4y ago
  I was about to give a whole speech about the many misconceptions I know US people have about Europe, and the differences between the welfare measures in both regions... but I lost the energy. Edit: I eventually ended up going on a tangent :) To be succinct, I'm from Spain, here you can fire anyone for no reason whenever you feel like it. If you do so out of a whim, you have to pay about ~20 days per each year that employee worked in your organization. This is the worst case scenario. What everyone refers to "you can't fire people in Europe". There are other circumstances in which letting someone go might get you in trouble (as in having to re-admit that individual). Such cases include letting someone go for ethnical reasons, pregnancy, illness, etc. You can get sued and after a due trial you might need to re-admit that employee and pay a fine. To put things in perspective, I have a close friend that got fired just when his company learned he had cancer (by a coworker). They went to trial (one year later) and the judge solved the case by an agreement where my friend got about ~3,000e (something negligible). Obviously, there are many other cases in which you can fire an employee without paying them anything. If the employee is not doing her job (not being on time, bad service, etc) you need to go through some hoops (filling fault forms) to justify letting that person go without any kind of compensation - this is similar to the US when someone is not performing and you want to let them go. Another case is if the company is losing money (which is different from predicting future loses or worsening its performance). The latter case is the one that companies like Google, Meta, etc are going through. They are not going bankrupt. They are actually having humungous benefits. The only thing that is preventing them from letting people go is that 1-month/year compensation I mentioned above. In some countries, these laws might differ a little bit, but I imagine they are cut from the same cloth. At the end of the day, in most situations, this does not differ that much from companies in the US where you are not entitled to any compensation but companies still give you some money to avoid any future lawsuits. For the regular Joe procrastinating in HN, these laws have close to no impact in their welfare because they are not part of a vulnerable strata of society. They won't be working in a McDonalds or a car factory in their 50's, and luckily cancer won't come knocking their door at their 30's or 40's before they had the opportunity to save as much money as they can with their IT jobs. However, for the people that are not that fortunate, being able to look for a job for 3 months after you got fired (so your past company could hire someone younger and more productive) is a blessing. Same as if you fall ill for a year and your non-IT job didn't let you save enough money. Neoliberalism is great for those who are well established in life. For those that when tragedy (death, illness, depression, simply bad luck) knocks their doors are well prepared both economically and mentally. For the rest, it's a hole that they might not be able to escape for the rest of their lives, which will have an impact in younger generations. On my side, I'm extremely grateful we have these laws protecting those who need it the most, even if (hopefully) I might never need them. I'm ~30, from Spain, my parents' family were immigrants (from inside Spain), living in what today would be seen as extreme harsh conditions. At the time of my parents, university was only for rich people. However, I had the luck to go to the world top109 and Europe's top14 engineering university for almost no money (1,000e/year). Today I have an IT job, working from Spain for a company from abroad, making more money than I need, and being grateful my taxes are high and I don't need to worry too much that an enraged homeless/crackhead do me any serious harm.
aseerdbnarng 4y ago
How daft do you have to be go on a hiring binge in Europe without looking into the labour laws. These laws didn't just fall out the sky last Tuesday
- ActorNightly 4y ago
  You assume that they hired with eventual plan of firing. Thats not the case. They hired because opportunity cost of not hiring was too high.
  - kar5pt 4y ago
    They should have known that an economic downturn was possible and planned for it. Wtf do these C-level execs get paid millions of dollars for?
    - ActorNightly 4y ago
      Preparing means potentially missing out on revenue during the time before the downturn, a.k.a the opportunity cost that I mentioned.
    - kevviiinn 4y ago
      They get paid for lining the pockets of shareholders as effectively as possible quarter to quarter
    - austhrow743 4y ago
      Why the assumption that they didn't plan for it?
    - bongoman37 4y ago
      [dead]
  - greeny7373 4y ago
    I still don't get Google and the others having huge revenue per employee. Google could easily put these people in making more money. But instead they launch weird products like their Blockchain service, miss out on AI etc. Google Io is in May, if they don't announce google personal ai assistant they don't have enough visionary people.

helsinkiandrew 4y ago

https://archive.ph/x2OGn https://archive.ph/x2OGn

ibnbutlAn 4y ago

EU labor laws protect the workers. I dont get why US Americans often think these laws dont benefit the workers.

nostrademons 4y ago
They level out both the upside and the downside. If you can never fire people, you're going to be very very cautious about who you hire in the first place. That makes it much harder to get companies into a bidding war that'll actually raise your wages. I've had a few European teammates, and they usually come to the U.S. because they can make 3-5x what they could in Europe. You'll see that a lot in HN comments, where people talk about USD$400K FAANG compensation and European developers will be like "Dang, WTF, I'm just sitting here with my €70K salary". Right now, going into a bust, everybody wants downside protection. You often make more over the long-term accepting some risk to pick the upside when it's available, though.
- throwawaymanbot 4y ago
  [dead]
- regularjack 4y ago
  You're assuming that the differences in wages between US and Europe are solely due to labor laws, which is quite a stretch, in my opinion.
  - aix1 4y ago
    I think it's interesting to compare Switzerland with the neighbouring countries (e.g. France and Germany). I don't know about other companies, but Google Zürich pays much more than Google Paris or Google Berlin/Munich. I think it's likely that the difference in labour laws is a contributing factor. Switzerland has very little by way of worker protection, instead placing a significant emphasis on unemployment insurance (Arbeitslosenversicherung).
    - mrunkel 4y ago
      Cost of Living is much higher in Switzerland.
      - nostrademons 4y ago
        Cost of living is usually higher in areas with higher wages, because it means that residents have more money to spend on living.
        aix1 4y ago
        Right, and Google explicitly doesn't model for cost of living in its comp philosophy.
        waych 4y ago
        They use per market pricing instead, which roughly works out to the same thing in the long term, while not being subject to short term fluctuations.
  - twelve40 4y ago
    I don't see the "assuming... solely" in their post at all. Seems like they are just pointing out a factor, could be one of many.
  - dumpsterdiver 4y ago
    Where did they make that assumption at all? How does the parent commenter acknowledging a single factor in a situation lead you to believe that they assume no other contributing factors exist?
- hsjqllzlfkf 4y ago
  > I've had a few European teammates, and they usually come to the U.S. because they can make 3-5x what they could in Europe. And as we know, the only difference between us and Europe is labor laws. /s
  - TexanFeller 4y ago
    I've worked with many UK/Europeans. They are quite similar to us in skills and productivity aside from labor laws(excessive vacations, months/years of parental leave, impossible to fire etc.)
    - wdb 4y ago
      Excessive vacations? What do you mean? It's not impossible to fire you only need a good cause to do so which I find reasonable.
      - TexanFeller 4y ago
        A good reason that often doesn't qualify is that business is down, macroeconomic conditions are expected to be unfavorable for the foreseeable future, and expenses, which for many businesses are dominated by salaries, need to be cut ASAP to ensure the business' long term survival and prosperity. Like now. Businesses in Europe simply have fewer options, like it's much harder to cut early and cut deep(hopefully minimizing future cuts) when trouble is ahead when you have to have protracted negotiations with unions and government agencies who have to sign off on your layoffs.
        kramerger 4y ago
        Union negotiations are about how to organise the layoffs, not whether you can fire the workforce or not. And if you expect help from the government, you need to show that your layoffs actually have a chance to make your company survive. For example, you cannot fire the entire R&D when you are 1 year from product release.
    - pleb_nz 4y ago
- future_i_snow 4y ago
  I make almost exactly €70k in Sweden and I am _very_ happy not making more since I also have very very cheap universal health care, and very very few mass shootings in the public schools my children are attending.
JPLeRouzic 4y ago
I am not sure, at least for France, that it's "all workers". For example the "code du travail" is excessively complex as it describes many kind of different private sector workers with very different rights. As a rule of thumb if you work in a large company you are well protected. In other cases it's very different, which partly explains the violence in the society.
- cutemonster 4y ago
  > partly explains the violence in the society What's that about? Could you please explain?
TechBro8615 4y ago
Well, the salaries are about 30-50% what they are in the US. Maybe it's related.
- hsjqllzlfkf 4y ago
  Maybe it's related, maybe it's due to the fact that the cost of almost everything in the US is higher. There's many factors in this conversation
  - TechBro8615 4y ago
    So companies just pay you out of the goodness of their heart because you need the money?
    - hsjqllzlfkf 4y ago
      I have no idea how you know from what I said to that. All I said is that available data does not allow you to conclude that the entirety of the difference in pay is due to difference in labor laws. It's not an extraordinary claim, it's quite tame in fact, I would self evident.
  - TexanFeller 4y ago
    > the cost of almost everything in the US is higher Certainly not compared to Europe/UK. I have friends that moved there and have spent many weeks over there myself. Property, living expenses, taxes, and many goods are generally noticeably higher over there.
    - cr1895 4y ago
      To counter your anecdote with mine, I’m always shocked whenever I return to visit the US how expensive basic things like groceries and rent are. Much more so than the Netherlands. This is complicated, and it’s insufficient just to state that everything in Europe is generally more expensive than in the US.
refurb 4y ago
Just like rent control does more than just "control the price of rent" because landlords change their behavior to optimize their financial returns, so do labor laws. Strong worker protection ends up making the cost of hiring new workers higher. Companies react to those costs by a number of means like delaying hiring, hiring contractors first, firing within the probation period when they might not have normally, etc, etc. Whenever the laws are changed, a new "optimum approach" is developed. And like rent control, labor laws often benefit the people who already rent/have a job. For people who are looking to rent/looking for a job, they can make it harder as the barriers to entry just got higher. It's not right or wrong, it's just a trade off.
- dantheman 4y ago
  There's definitely a right and wrong - it is morally wrong to use force to enrich yourself at the expense of others. In the case of rent control -- landlords and future renters suffer. In the case the employment -- it's employers and future workers.
  - em-bee 4y ago
    how does rentcontrol let future renters suffer?
    - refurb 4y ago
      If, as a landlord, you know you can never raise the rent, and you can't evict a tenant except for very limited reasons, well then you have your own internal set of screening criteria and you only take the most qualified renters. It's far better to leave the unit empty for a few months because the loss of rental income is tiny compared to the financial loss of choosing the wrong tenant.
      - em-bee 4y ago
        i see your point but i don't think this is true. i believe that bad tenants are uncommon but exist at all price levels. raising rent is not going to keep them out and they will have to be screened anyways. i don't know how rentcontrol works elsewhere, but in germany generally it means that rent can't be raised more than once a year or 15 months or something in that range, and it can't be raised more than a few percent each time, but it doesn't mean that it can't be raised at all. not being able to evict a tenant is independent of that. the general issue here is a power differential. big company vs small family. i know in the US there are more small landlords who only have a few houses or even one. but that is rare in germany. most are bigger businesses with hundreds of apartments, and with that the risk of getting a bad tenant is obviously larger, but the financial risk is also spread over all tenants.
bjoli 4y ago
I think it is because it benefits workers differently. People with high salaries would usually get even higher salaries in the states, whereas people with low-earning jobs would get less paid with a less stable employment. The HN selection is just skewed. A friend of mine with a VERY sick disabled kid which prevented her from working night shifts in a home for the elderly would probably have gotten sacked by now hadn't it been for the Swedish labour laws that mandate that the employer tries to find a different position within the same qualifications in the same organisation. Sure, the union had to help and remind them of that obligation, but in the end it worked out for the best for my friend. I don't think the laws are there to protect someone like me that could get another job, but to protect people like my friend.
TexanFeller 4y ago
Strong worker protections are a major reason that big tech and many other industries have a much smaller presence in Europe and pay far less to Europeans. You're worth less if you might be absent on parental leave for a year at a time. You're higher risk to hire if you can't be fired easily etc. Protections have a cost. My friends that moved to UK/Europe get half their former salary and have much higher living expenses and taxes. I also have several friends that moved to TX because compensation in Europe is terrible.
- dingusdew 4y ago
  [dead]
- WeylandYutani 4y ago
  It all depends on what you value. Dutch labour laws are not written for highly educated tech bros but designed to protect everyone. Wealth inequality for instance is something that permeates political discourse. Americans don't give a shit about it at all. Making society nicer for everyone and not leaving anyone behind.
  - dantheman 4y ago
    Making society nicer for everyone requires investment.
    - smcleod 4y ago
      * in people, not profits.
  - throwaway6734 4y ago
    >Making society nicer for everyone and not leaving anyone behind. In the short term, Europe is much better at this than the US, but the long term sustainability of the European welfare state will be under serious threat over the next 50 years due to the horrible demographics of most European countries
throwaway22032 4y ago
I am British. If you need labour laws beyond basic safety stuff then you're simply not being paid enough. I would far rather have sufficient income and therefore wealth built to be able to choose for myself whether I want to take time off. I actually find it juvenile that people want employment to be this way. What do they think is going to happen when they stop working? Or is the plan - again a juvenile one, seeking a parental figure - "I'll just work for a company until I die"? Have fun with that...
tripleaaa 4y ago
[dead]

palata 4y ago

Mouaha.

deleted 4y ago

[deleted]

bluedino 4y ago

Will this potentially make these employers more hesitant in the future to hire in countries where they will have a harder time letting them go?

deleted 4y ago
[deleted]
shagie 4y ago
The Employment of the Low-Skilled Youth in France - https://docs.iza.org/pp64.pdf https://docs.iza.org/pp64.pdf > Youth unemployment is notoriously high in France, in particular for the low-skilled. Within the EU, only the crisis countries of Southern Europe fare worse. This report delivered to the French Council of Economic Analysis analyzes the causes and consequences of this alarming trend. In addition, drawing on the available evidence on various measures that could improve the current situation, concrete policies proposals are derived that cover the areas of vocational education, second chance programs, job search assistance, income support, employment subsidies and dismissal protection. Why Is Unemployment in France So High? - https://www.elibrary.imf.org/display/book/9781557754912/ch01.xml https://www.elibrary.imf.org/display/book/9781557754912/ch01... > With regard to the demand-side causes of long-term unemployment, employers faced with continued uncertainty about future orders may refrain from recruitment for long periods of time, causing the persistence of both unemployment and long-term unemployment, particularly if wages are not flexible. Labor market rigidities, such as the relative generosity of long-term benefits, employment protection legislation, the minimum wage, and high employer costs are other potential contributory factors. > ... > The 1986 work dismissal legislation in France requires that those being dismissed are given one to two months’ written notice of dismissal and informed in writing of the reasons for their dismissal. At the same time this legislation removed the need to seek the permission of the Labor Ministry for collective dismissals. Other legislation in 1989 obliged companies to prove the cause of dismissal. The law in France also requires that workers be paid up to a maximum of one and a half months’ salary as severance pay. Though the legal restrictions on dismissal in France are less strict than those in the southern European countries, they are more strict than those outside Europe, particularly in the United States.

fooofw 4y ago

Is there anywhere I can learn more about these regulations and what are the differences between different European countries? What Bloomberg writes here is not so concrete beyond requirements for consultations". Are you really not allowed to lay people off to save money?

tmpaccountt 4y ago
I was about to give a whole speech about the many misconceptions I know US people have about Europe, and the differences between the welfare measures in both regions... but I lost the energy. Edit: I eventually ended up going on a tangent :) To be succinct, I'm from Spain, here you can fire anyone for no reason whenever you feel like it. If you do so out of a whim, you have to pay about ~20 days per each year that employee worked in your organization. This is the worst case scenario. What everyone refers to "you can't fire people in Europe". There are other circumstances in which letting someone go might get you in trouble (as in having to re-admit that individual). Such cases include letting someone go for ethnical reasons, pregnancy, illness, etc. You can get sued and after a due trial you might need to re-admit that employee and pay a fine. To put things in perspective, I have a close friend that got fired just when his company learned he had cancer (by a coworker). They went to trial (one year later) and the judge solved the case by an agreement where my friend got about ~3,000e (something negligible). Obviously, there are many other cases in which you can fire an employee without paying them anything. If the employee is not doing her job (not being on time, bad service, etc) you need to go through some hoops (filling fault forms) to justify letting that person go without any kind of compensation - this is similar to the US when someone is not performing and you want to let them go. Another case is if the company is losing money (which is different from predicting future loses or worsening its performance). The latter case is the one that companies like Google, Meta, etc are going through. They are not going bankrupt. They are actually having humungous benefits. The only thing that is preventing them from letting people go is that 1-month/year compensation I mentioned above. In some countries, these laws might differ a little bit, but I imagine they are cut from the same cloth. At the end of the day, in most situations, this does not differ that much from companies in the US where you are not entitled to any compensation but companies still give you some money to avoid any future lawsuits. For the regular Joe procrastinating in HN, these laws have close to no impact in their welfare because they are not part of a vulnerable strata of society. They won't be working in a McDonalds or a car factory in their 50's, and luckily cancer won't come knocking their door at their 30's or 40's before they had the opportunity to save as much money as they can with their IT jobs. However, for the people that are not that fortunate, being able to look for a job for 3 months after you got fired (so your past company could hire someone younger and more productive) is a blessing. Same as if you fall ill for a year and your non-IT job didn't let you save enough money. Neoliberalism is great for those who are well established in life. For those that when tragedy (death, illness, depression, simply bad luck) knocks their doors are well prepared both economically and mentally. For the rest, it's a hole that they might not be able to escape for the rest of their lives, which will have an impact in younger generations. On my side, I'm extremely grateful we have these laws protecting those who need it the most, even if (hopefully) I might never need them. I'm ~30, from Spain, my parents' family were immigrants (from inside Spain), living in what today would be seen as extreme harsh conditions. At the time of my parents, university was only for rich people. However, I had the luck to go to the world top109 and Europe's top14 engineering university for almost no money (1,000e/year). Today I have an IT job, working from Spain for a company from abroad, making more money than I need, and being grateful my taxes are high and I don't need to worry too much that an enraged homeless/crackhead do me any serious harm.

aseerdbnarng 4y ago

How daft do you have to be go on a hiring binge in Europe without looking into the labour laws. These laws didn't just fall out the sky last Tuesday

ActorNightly 4y ago
You assume that they hired with eventual plan of firing. Thats not the case. They hired because opportunity cost of not hiring was too high.
- kar5pt 4y ago
  They should have known that an economic downturn was possible and planned for it. Wtf do these C-level execs get paid millions of dollars for?
  - ActorNightly 4y ago
    Preparing means potentially missing out on revenue during the time before the downturn, a.k.a the opportunity cost that I mentioned.
  - kevviiinn 4y ago
    They get paid for lining the pockets of shareholders as effectively as possible quarter to quarter
  - austhrow743 4y ago
    Why the assumption that they didn't plan for it?
  - bongoman37 4y ago
    [dead]
- greeny7373 4y ago
  I still don't get Google and the others having huge revenue per employee. Google could easily put these people in making more money. But instead they launch weird products like their Blockchain service, miss out on AI etc. Google Io is in May, if they don't announce google personal ai assistant they don't have enough visionary people.