Why is that extreme? If you own a company, why shouldn't you be able to fire someone at any time? If you work a job, why shouldn't you be able to quit at any time?
I don't think it's great that our society tries to treat work like it's family, and jobs like they're some guaranteed long-term relationship. It sets people up with the wrong expectations.
Your company will lay you off or fire you once they run out of money to pay you or reason to keep you on board. That's how it works. Just as you will quit your job and take a new one if you interview and get a better offer elsewhere.
For the same reason companies shouldn't be able to band together with other companies to not allow raises. They're anti-competitive practices, which eats away at the entire point of having a market, which is for competition to force parties to offer better prices, bid higher amounts, and produce better products/services, which benefits everyone. For example:
- Landlords should not be able to collude to keep rent prices high. They should be forced to compete against each other, either by offering lower rent or better premises and services to tenants. The result is that over time, society gets better and better places to live, that are nicer, updated, and safer, at cheaper prices.
- Healthcare providers shouldn't be allowed to collude to set uniform prices for services. They should have to compete on price, quality of care, or access to treatments, ensuring patients can choose better or more affordable options. The result is that more and more people can afford healthcare services, which themselves become increasingly effective over time.
- Internet service providers shouldn't be able to divide territories or coordinate to prevent competition in specific regions. They should have to compete, driving down prices or increasing service quality for consumers.
- Software companies shouldn't agree to not hire each other's employees to keep wages low. This prevents employees from negotiating higher salaries and better benefits, hurting workforce dynamism and innovation.
Etc.
Capitalism is simply a collection of laws and regulations that blocks all means of profit other than simply offering a better deal or better services. The goal is for those to be the only real ways to profit. The side effect of workers and companies all competing to do this in order to profit is that society benefits by having a ton of innovation to make better and better things, at cheaper and cheaper prices. Which is the central reason why, today, the average person can have a cell phone, a TV, the internet, amazing healthcare treatments, and an almost infinite array of options for clothing, food, entertainment, etc.
Allowing people to profit in ways that disrupt competition gunks up the entire functioning of the market. Maybe you get some short-term benefit, but ultimately you end up with a system that doesn't create nearly as much wealth and prosperity. Because why go through the trouble to create great things for your customers (as a company), your employers (as an employee), or your employees (as an employer) if you can instead benefit by simply banding together with others and colluding, or monopolizing some essential resource, or fixing prices, etc.
I recommend you travel to LATAM or EMEA, where worker protections are much higher. No one gets fired because protections are so high. At-will is unheard of [1]. In some countries, there's a mandatory X months of salary for Y months worked. The regulation of the labor
market, however, is strict and inflexible [2], and all LATAM jurisdictions impose mandatory severance pay for wrongful terminations.[2]
What are the results of worker protections mentioned above ? Literally no jobs with protections. See for yourself. LATAM has an average of ~65% informal employment. Take Argentina for example. Close to 50% of the labor market are under-the-table "jobs" for this reason.[3]. Even more developed countries suffer the consequences , such as UK having 24% informal sector [4]
All those governments intended to look out for humans before corporations. It didn't work out that way.
The road to poverty is paved with good intentions.
US dynamism actually creates more jobs as more are willing to try new things and experiment.
Yes, you can protect workers, very very well.
But only if you are OK with a tiny amount of protected workers, and let everyone else toil in the informal sector where zero protections exist
From your own source: UK's informal employment rate? 6.5%, not 24%. Ireland? 1.8%. Germany: 2.5%. Norway: 2%. Many EU countries have strong labor protections alongside low informality and high employment. While labor protections pose challenges, they do not inherently lead to high informality or low job creation. Effective policy design and enforcement are key to achieving economic stability with strong worker rights.
I'm not surprised, on a startup-angled site, that there'd be dissatisfaction with not being able to hire and fire at will. COVID had employees re-assess what was important for them. Tangentially, now we're seeing that shorter working weeks results in higher employee productivity and satisfaction.[1]
Having job security, when you've taken on long-term commitments like a mortgage and raising kids, is considered important in many parts of the world. The EU isn't SV; for employees that's probably a good thing.
>>>I'm not surprised, on a startup-angled site, that there'd be dissatisfaction with not being able to hire and fire at will
Its not just startups. The chickens always come home to roost.
Lets go into COVID since it is a wonderful example. Employers in Ecuador dealt with minimum wage protections well outpacing productivity growth precovid, doubling the cost of protections relative to Colombia and 75 percent higher than in Peru [1] . Then COVID hit.
The central government had no choice but to temporarily rescind the rules of strict protections under "force majeure". This eliminated all severance payments to employees under 'force majeure'. [2]
What happened?
A bunch of low performers who had built a decade or more in 1 job, got unexpectedly laid off, despite working in perfectly operating businesses with no risk of bankruptcy (AG, export adjacent etc) Then, with zero marketable skills from a decade of non-work, these workers are chronically unemployable now. [3]
PS - Regarding the UK number cited, which some people felt very strongly about.. I made a mistake and quoted the wrong year. I can't edit my comment any longer [4]
[3] https://www.elibrary.imf.org/downloadpdf/journals/002/2021/2... , see page 13, section 6 ("the recovery has been very partially among the less educated (persons with basic education or less) ....'they exited' the labor force in larger numbers from the crisis onset")
Why are you now talking about Ecuador and COVID? And you haven't addressed the UK link where you say 24% but it's 6.5%. Makes the rest of what you blather more untrustworthy than it was
I work in the EU, and I'd rather see the American "at-will" system, but with a basic income + additional financial distress protections.
It is IMO ridiculous that in a lot of EU countries, chronic low performance is not just cause for firing.
It makes economical sense to reduce the friction of allocating workers where they'll be most productive. It just shouldn't destroy those workers' financial security.
I'd argue the main reason low performance employees don't get fired is because managers either don't know who the low performers are, or don't want to have an unpleasant conversation and can choose to put it off indefinitely.
> You think LATAM is in poverty because of their worker protections? Not the decades of western exploitation of their natural resources? Not the decades of American interference in their political systems to destabilize their government? Sure.
No, countries regularly go from poverty to wealth quickly. It's purely cultural which is upstream from policy.
It's not black and white. It's a sliding scale. Society already does a ton to look out for the individual worker. It's more a question of where things should fall on that scale.
Coddling workers by expecting corporations to basically act as their family, their parents, their financial planners, their healthcare providers, etc., is terrible.
We should not be telling people to expect any particular corporation to provide them a livelihood indefinitely, when it's a simple fact that corporations cannot do that. They can afford to pay you when it's profitable for them to do so, and that's it. That's the deal. Period.
I'm all for taking care of people. That's what our government should do itself. We should not be placing that role on corporations. And we should not be telling people to expect that their jobs will last forever and they can't be fired. We should instead tell people to maintain their skillsets, maintain their savings, and live within their means, so they can weather inevitable job changes. That's what caring for people actually looks like.
Not necessarily. Sure it is better if every other factor is held equal, but it's not: everyone benefits from living in a more highly economically developed society where industry is more successful. So you have to weigh pro-worker concerns against these other benefits.
If your argument were valid then its logical conclusion would be that all profit from the business has to distributed to the employees (as in most traditional strains of far-left thought). In practice systems like that have major flaws.
When your company gets even a little big, the decision making process gets filtered through sufficient levels of management that it's not the company owner firing people at any time: It's an employee who doesn't necessarily have to be aligned at all with what is good for the company that is firing people at any time.
Eventually you learn that one of your middle managers managed to fire someone for some reason that is illegal, or is related to some kind of crime, and guess what? It seeps upward, and your company is in the wrong.
A process doesn't just protect the employee, it protects you from the iffy middle management that, without exception, gets in. And the more freedom you give them, the worse the behavior.
I would agree with this but if that's the case why employees are not given the same perks as companies from a tax point of view? My personal preference is to treat every human as a business. The alternative would be to eliminate all taxes except sales tax with some cutoff for low income persons.
Yes, and it's an employee's responsibility to not depend on a single job, and to be prepared for the possibility that it might go away. That's the mindset we should be teaching people, because it's REALITY.
Plenty of people are aware of this, and they navigate this successfully by saving part of their income, by maintaining an employable skillset, and by living within their means, while working a job.
When you suggest to people that it's their company's responsibility to take care of them, to guarantee their job into their future, or to look out for their personal financial livelihood, that IS NOT REALITY. That's not how it works. You're telling people that their own responsibilities are someone else's, when that's not in fact true. When people mistakenly believe this drivel, they're far more likely to take bad risks and make huge financial mistakes.
Employers employ many people at once. The risk of a bad employee is divided by the entire workforce.
Employees, on the other hand, put all their eggs into one basket at a time. Many (most?) employers specifically forbid moonlighting and working multiple full-time jobs at once, so employees are forced to depend on a single job at a time. The risk of having a bad employer is shouldered 100% by the employee.
It's this power dynamic that justifies different standards for employers and employees.
Business is not all huge companies with infinite redundancy. There are 30M small businesses in America that employ 60M people. For the vast majority of businesses and teams, losing an employee hurts, and employees have lots of leverage. These business owners have to do the work to ensure redundancy, to plan their budgets and products and systems to ensure they can weather inevitable employee turnover. Plenty of businesses fail to do this and have to close their doors. It happens with regularity.
On the flip side, unemployment is the US is super low. It's true that workers can only hold one job at a time, but they are not "trapped" at a job. In fact, they have more mobility than ever, which also gives them leverage to negotiate for higher salaries or to hop jobs. Not to mention more gig jobs, remote jobs, and contract jobs than ever, even for highly paid positions. Sure, losing a job hurts. But the employees who plan for this possibility, who maintain skills, maintain savings, and live within their means, can find new jobs, just as businesses who plan well can weather employee turnover.
It goes both ways.
So if you're in a position where your employer has some huge power dynamic hold on you, is that some universal truth for all employees resulting from the nature of the employer-employee dynamic? I don't think so. I think that's the result of poor personal decisions, or bad luck at best.
All that said, I'm 100% on board with legal protections that set a high standard for employers. We have plenty of those already. And I'm 100% on board with government stepping in to help take care of people who fall through the cracks. For example, I love that COBRA allowed me to stay on my previous employer-provided group healthcare plan for 18 months(!) after my last job ended.
What I'm against is any cultural or legal change that begins to suggest that its employers' responsibility to keep their people employed. It's not. Financially, the system can't work that way. Employers are not our parents or our nannies or our caretakers, and we should not try to make them into that.
Hundred percent. Yet, it's also reality, today, that the power asymmetry between individuals and corporations are huge. Anybody trying to bootstrap an independent business is heavily punished, simply because corporations want you to be an employee, just because they can. Unless the system balances the power dynamics, it's futile to tell people that they shouldn't ask for more rights from corporations.
I literally run the biggest website for people trying to bootstrap independent businesses, and I haven't seen anyone complain about being heavily punished for trying to do so. Founders are the most employable people I know, and they typically find it the easiest to go get jobs when their businesses fail (although they hate doing so).
Not everyone has a rich family to fall back on, bud. You could say "fall back on the government" but then this is how the government would do it. They wouldn't want you to fire people for no reason at all. In the same way that people are paid a certain wage as an agreement, there are other conditions too. This can be part of those conditions.
Your claim of:
> Yes, and it's an employee's responsibility to not depend on a single job, and to be prepared for the possibility that it might go away. That's the mindset we should be teaching people, because it's REALITY.
is capitalist mindset that thinks there's never a chance of change. Kinda pathetic for a MIT grad, tbh.
Personal attacks are shite, especially when they dig into someone's background for extra 'bite'.
P.s. what rock have you been living under where you have a preconception that all MIT graduates are ethical white knights that share all of your own opinions?
It's one of the most varietal student bodies at a school that forks people majorly into military programs and research labs.. to expect harmonious homogeny regarding ethical opinions from the graduates is ridiculous.
I don't think it's great that our society tries to treat work like it's family, and jobs like they're some guaranteed long-term relationship. It sets people up with the wrong expectations.
Your company will lay you off or fire you once they run out of money to pay you or reason to keep you on board. That's how it works. Just as you will quit your job and take a new one if you interview and get a better offer elsewhere.
These are business contracts.