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‘Measuring’ job quality with labour law indicators

This study delves into how globalization impacts job quality and employment through the lens of labour law indicators. It looks at the winners and losers in the global economy and the increasing competition leading to pressure to cut labour costs. The text explores methods to capture changes in job quality, comparing conventional methods like Labour Force Surveys to measuring changes in labour legislation. The Firing Regulation Index across different countries is examined, shedding light on the legal frameworks governing job security. The advantages and disadvantages of using these indicators are also discussed.

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‘Measuring’ job quality with labour law indicators

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  1. ‘Measuring’ job quality with labour law indicators

  2. Globalization Winners and loosers Impact on Employment and Labour

  3. Globalization Increased competition More pressure to reduce labour costs Impact on the quality of jobs

  4. How to capture changes in job quality? • Conventional Way = Labour Force Surveys • ‘Measuring’ changes in labour legislation

  5. Statistical Indicators: Legislation regarding firing workers Selected indicators • Can an employer terminate the employment contract without cause? Yes (= 0), No (= 1) • Does the law establish a list of ‘fair’ grounds for dismissal? Yes (= 0), No (= 1) • Most employers notify a third party before dismissing a redundant employee? Yes (= 0), No (= 1) • Does the law mandate retraining or replacement before dismissal ? Yes (= 1), No (= 0) • What is the length of the legally mandates notice period? ( 0-24 weeks)

  6. Job Security Index measures the protection of rules governing the termination of an employment contract as the average of: • Protection of grounds for dismissal (3 indicators) • Protection of dismissal procedures (7 indicators) • Notice and severance payments (4 indicators) • Right to job security embedded in the constitution ( 1 indicators)

  7. Firing Regulation Index (2003) Canada 0 USA 10 Denmark 10 Italy 30 France 40 Germany 40 Netherlands 40 Spain 60 Ukraine 80 India 90 Mexico 90 Source: World Bank, ‘Doing Business’ database website.

  8. Trend of firing regulation index (1997-2003) (Sample of 60 countries)

  9. Advantages • Avoid ‘overcharging’ labour force surveys - Less costly than labour force surveys

  10. Disadvantages - Not all workers covered by labour legislation - What is labour law is violated? - Problem of indexing (standardising, weighting)

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