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Comment by danwee | Hacker News Reader

I always wondered how American companies lay off European employees (when the companies have branches in European countries). Usually, in Europe, you cannot just fire someone without a justified reason (and no, saving costs is not a justified reason). Such reason are usually: the employee did something illegal (data leaks, sell internal information, etc.) or something related to harassing other employees. Even with bad performance, they cannot just fire you without first giving you the option to "recover".

I don't know Carta at all, but if they had an European branch and if I were an European employee that is being told "you're fired", well, they will have a really hard time doing it.

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I don’t know about the rest of Europe, but here’s how it usually plays out in Sweden: 1. Company needs to save money. 2. Company decides to shut branch office X and cancel project Y. 3. Company now has more employees than it has positions. 4. Employees get reshuffled across remaining positions according to complex rules (but basically last-in-first-out). 5. Employees that end up being "left over" are laid off. So the official reason is not "lack of money", but "lack of work". I’ve seen it happen several times, and ended up on both sides of the rope, so to speak. It’s a matter of Following The Procedures, but that’s all there is to it.

I can only speak to the UK who remain a European (if not EU) country. My understanding having been through it in my first job, is in the UK you must make a given number of a specific role redundant. So it's not the people you're laying off but instead you say, we're making cuts to 4 sales positions. There is then a required consultation period where the people to be laid off are identified so there's always forewarning that cuts are happening but not to who.

So it's not firing but it's still perfectly possible to reduce headcount. What you can't do is the standard US move of firing everyone with zero notice by email.

I think there's a legal difference between laying off employees "in bulk" by shutting down teams/divisions versus firing individual employees .

> (and no, saving costs is not a justified reason)

This is incorrect. Every jurisdiction allows for laying people off to reduce costs. This is the primary thing a business is supposed to do -- hire when there is more work and fire when there is less work.

The only requirements in the EU are notification periods and filing the appropriate paperwork for mass layoffs -- known euphemistically as "collective redundancies". See here: https://europa.eu/youreurope/business/human-resources/employ...

Moreover European companies lay people off all the time during downturns as does everyone else.

https://www.wsws.org/en/articles/2022/12/23/mkez-d23.html

How is saving costs not a justifiable reason? Maybe all of this is why European employees have such a hard time finding US salaries.

>How is saving costs not a justifiable reason?

Most likely because you could justify any firing to be "cost savings" and thus defeat the whole purpose of job stability.

Think about a tech company.. they could increase their staff by 25% for a year, using that team to advance products, meanwhile the new employees think they have a stable career on their hands.. but then the tech company is just like "nope, you are all fired". And they benefit into perpetuity for what the employees did while the employees are getting nothing more from that company and don't have a job.

Yes I'm oversimplifying, but that is part of what these laws are trying to avoid. It's unfair to the employees to have these mass hirings and mass firings with mass information asymmetry. In theory it would create more of a culture of "we hired you for the long term".

It is, but you cannot use it to fire a particular person. I mean, you get to choose who to fire, but if you need to hire somebody again for that position (because business is picking back up), you have to give the fired person the first option to come back.

That’s the most plausible reason I’ve heard so far tbh. I don’t know much about Europe but I’ve always been curious about the dismal salaries over there.

If saving costs was a justifiable reason how could literally any firing whatsoever ever not be justifiable?

How can "we don't have the money to pay you" not be a justified reason?

What about "We have the money to pay you but we don't want to anymore"?

No idea about this case. But often it seems they're cutting cost because they think they can, not because they have to.

Employee protection. Just because the management could not balance the sheet is not a good enough reason employees should suffer the consequences. At least in theory.

But if the company is shutting down a whole team without replacement, the employees should still get the option to relocate into another role. They can be let go only after that fails.

If the company cannot afford the post, then you're made redundant. So yes you can quite easily get rid of people to save costs.

My understanding is admittedly limited, but I do not believe companies are allowed to just make positions redundant in germany. Layoffs must be coordinated with the government and they basically look through your books and decide if you really need to lay these people off.

Germany's main requirement is that you have insufficient open positions in the company (not just same roles - no open positions at all, the company is obligated to train), and that you follow "social selection", taking into account "tenure, age, family responsibilities, severe disability". High performance can be justification to keep someone despite meeting the social selection criteria for termination, but low performance cannot generally be a reason for inclusion in the list of terminations.

If you are legitimately downsizing it is pretty easy. If you are trying to use "layoffs" as cover to cut the bottom x% of performers, you'll hit trouble.

I have been involved (from a Senior management perspective) in one significant layoff that affected US and UK employees. How we did it in that case is we took legal advice about what was the minimum requirement, and then leveled-up/adjusted from there to try to be as generous as we could. Layoffs are certainly possible even within the framework of EU labour law, but employees have more rights and depending on how big you are there may be additional requirements (eg in large companies in continental Europe I believe labour representatives have to be involved in the planning of the layoff etc).

The exact specifics of the deal in our case were a little different for US and UK folks because of things like how healthcare works in the US being so completely awful so you have to figure out things like COBRA which would just not be a thing in Europe. That forced us to adjust things to make it equitable/equivalent for both US and UK folks, but we really tried our best to be fair to everyone.

While the base requirements are much higher in the UK/Europe than in the US if you have teams in both places, you should do whatever you can to offer broadly the same deal to both teams. Besides your basic duty as a human to be fair to people, note that your remaining employees will judge you based on how you treated their departing colleagues.

According to this, there can be economic justifications for layoffs in France. But it looks like there is a mandatory severance of 12 months.

https://www.safeguardglobal.com/resources/blog/terminating-a...

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