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Saturday, December 16, 2006

Job Protection Policies and Worker Harassment

Chris Dillow presents an argument against job protection policies:

Job protection: bad for workers, by Chris Dillow: Employment protection laws are bad for workers. Not just the workers who don't get hired because employers are frightened of being unable to sack them. They're even bad for the workers covered by them. In this paper (pdf) via the CEPR, Etienne Wasmer says:

Protection against individual dismissals raises pressure from management, bullying, workers' stress and, to a lesser extent, the incidence of distress and depression.

There's a simple reason for this. If firms find it expensive to sack workers, they'll monitor them more intensely to get them to work harder. And they'll harass less productive workers in the hope they'll quit voluntarily. The increased stress to workers caused by this can offset the benefit of greater job security, says Professor Wasmer. For me, this corroborates my prior - that, ideally, workers shouldn't look to the state for protection. Better protection against tyrannical bosses would be stronger trades unions, full employment or worker ownership.

    Posted by on Saturday, December 16, 2006 at 12:06 AM in Economics, Policy, Unemployment | Permalink  TrackBack (0)  Comments (30)

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