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Comment by sneed_chucker | Hacker News Reader

I wonder if the US will ever get first-world tier labor laws that prevent companies from screwing people over like this.

Doesn't seem likely any time soon, but it's so insane how healthcare and everything is tied to an employer and in most places they can just fire you on a whim and not offer severance or anything.

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I am absolutely for decoupling healthcare from employment (via universal care), and for mandated severance.

However, there's a reason that so many - I'll pick on Germany here - German tech leaders move to the US. When firing employees becomes too hard, hiring is risky, giving people broad latitude is risky, and compensation suffers because high comp is risky.

If you're a very capable software engineer, it's better to be in the US. If you're a not-very-effective one, it's better to be in a place that will make getting rid of you much harder for the business.

> When firing employees becomes too hard, hiring is risky, giving people broad latitude is risky, and compensation suffers because high comp is risky.

I don't follow this conclusion at all.

It seems self-evident, but maybe that's from managing teams that span countries and seeing the difference firsthand. Here's a concrete example:

Congratulations, you're now an EM! You get +1 headcount for your team this quarter. Your interview pipeline winds up with two candidates who get exactly equal recommendations.

One of these people (A) lives somewhere that, if they turn out to have neutral or negative value on the team, you can easily let them go. The other (B) lives in a place where, based on your management training and company policies, you have to first make a request through the legal department, then go through at least six months of PIP to (maybe) get rid of them.

Which of them do you hire?

If the answer (A) is too obvious here, let me add one more detail: A wants to come in at the role's max level, whereas B would accept one level lower (less comp). Does that change your answer?

Almost certainly not. You're a line manager. The cash for this isn't coming out of your pocket! There's no reward for getting folks to agree to less than market value. On the other hand, a bad hire makes you look bad, and a bad hire requiring working with legal over a protracted period in order to avoid liability - even worse. If your hiring decision results in an employment action against your company? A managerial nightmare!

Meanwhile, your top performers are asking you why the hell they're working so hard and contributing so much when it seems like performance doesn't matter for retention on your team. You're legally barred from sharing information about the in-progress coaching of the negative-impact teammate.

I don’t see what’s so difficult here.

If it’s risky to hire (because terminating is difficult, takes a long time, is riddled with red tape), then employers will be slow to do so. Less competition for employers to find workers, lower pay overall. High compensation is even risky because of the burden of having to keep employees on due to labor law compliance.

I personally believe it is better to have a robust unemployment insurance system in place that helps workers bridge the gap between jobs.

I don’t know if the assertions are true in practice, because I’ve only worked in the US and not Europe, and have never held a tenured position or had a union, but the logic described seemed straightforward enough: if it’s difficult to fire an employee, then you must be more cautious in hiring, because you may be saddled with a poor employee for longer than you’d like. Likewise, empowering employees to take high stakes risks is suggested to be more dangerous if the employer loses the ability to easily let employees go if the employee’s poor judgement causes disaster. (Think sink or swim, give them enough rope to hang themselves — this doesn’t necessarily sound like a great employer.) Finally, offering high salaries is more risky if you can’t let those employees go if they fail to perform. As a counter-factual thought exercise that all seems plausible, we do like our at-will employment here, but no idea if it’s really that difficult to fire employees outside the US — he does make it sound like more of a long term marriage relationship where additional caution is warranted. That all aligns with the uninformed stereotype I have in my mind that the US is more pro business and Europe is more pro worker. While the proposition is internally consistent, I’m eager to hear if it’s sound.

I'd guess they're saying that if you're in an environment where making staffing changes can be legally challenging, you might opt to keep people on a tight leash at low salaries. You could in theory I guess hire someone low comp within a box, watch them, promote them quickly, and expand their latitude if they turn out to be high preformers. I don't know much about highly regulated labor markets so no clue if this exists in reality, but I suppose it's not impossible.

> > When firing employees becomes too hard, hiring becomes risky

If a firm has severe restrictions on firing anyone, then it must be extremely diligent with hiring, because employees will be around as long as they want to be. If an employee is unproductive, lazy, or just a bad fit, then the firm will be stuck giving a paycheck to someone who really ought not to be there. Thus firms will simply delay hiring.

> > giving people broad latitude is risky

I admit, I'm not exactly sure what this means, but I would surmise it means that employees need to be micromanaged to ensure loyalty to the firm, since they have no natural consequences of going rogue.

> > compensation suffers because high comp is risky

If the firm grants significant pay increases but cannot terminate someone, that pay increase becomes a permanent recurring expense, even if some future event renders that pay increase inappropriate or unnecessary. Thus firms will minimize pay increases.

These are "deadweight losses" where optimal exchange between employers and employees is limited by some policy.

Since Germany was mentioned specifically, I'm curious what the laws are around decreasing pay, if it's as hard as firing someone, if some threshold or percentage would be considered a constructive firing, etc. This could eliminate some of the risk of high compensation if, for example, you could hire someone at $100k/yr USD equivalent and then after a reasonable review cycle lower the pay for bad performance.

Yeah, I have a lot of friends and family in German and think their labor laws are a little extreme.

Feels like some sort of balance should be achievable?

The harder, riskier, and more expensive you make it to hire new people, the more companies will play it safe by avoiding junior hires and putting more headcount in less restrictive countries.

A few jobs ago our mobile dev team was in an EU country with significant protections against firing people. Their interview process involved a take-home problem that would have easily taken 80-100 hours, more with polish. I couldn’t believe anyone would actually do that, but they had a long line of applicants requesting to apply. They said they couldn’t risk hiring anyone who couldn’t demonstrate that they were very good because firing them would be a huge ordeal involving lawyers, months of time, and very expensive payments if it didn’t work out.

That doesn’t really pass the smell test. Countries with employment protections still have probation periods during which the company can fire you without hassle. For example in Germany 6 months is a common duration.

https://allaboutberlin.com/guides/probezeit

If you cannot evaluate an employee’s worth in 6 months that’s pretty problematic.

Some bosses don’t love firing people and give people too much of a chance. We hired someone and I told the boss to fire him the first day, he was that bad. He didn’t, time dragged on and he never improved, he only got worse in new and spectacular ways. By the time it reached a breaking point it had been well over a year and they had to do a ton of paper work, track performance, give him a PIP… so many hoops. I think he ended up working for us for 3 years. We even caught him red handed lying to skip out on work, and his lie to HR to cover it up involved him using company equipment to run a side business during work hours (somehow they didn’t see that as a red flag). This was I the US, where when I was hired I was told flat out they could fire me with no notice and no reason. The company was always worried about lawsuits around firing people, so they liked to have all their ducks in a row.

It seems like it could be easy to make it through 6 months unless the company takes it really seriously.

In a large company, it's more likely for a manager to inherit an employee than to hire them. Often long after this six-month period.

At that point, the manager is just stuck with the net-negative employee.

After 6 months the employee is then free to do the bare minimum.

You can still be fired, the company needs to justify it and in practice it isn’t that difficult to do. But employees can for sure always do the strict minimum, implying they do the their job correctly. I don’t really see the issue with that

You’re not entitled to a job. It’s a fair market. I for one would not want this kind of environment.

Healthcare is a different story.

You don’t need everyone, just a majority. There is no value in arguing with people who think this is sustainable.

I don't know why you're being downvoted. Strong labor protections and a generous social safety net with the goal of making it so that being fired isn't the end of the world would be a huge net positive for the labor market. Guilt free firing means you can allocate labor efficiently where it's actually needed specifically because you're not dealing with people's livelihoods.

And right now our social safety net for situations like this is built into unemployment insurance, we should expand it.

At some point you have to pay the pied piper.

All the collectivist projects ("safety nets") are just shifting liability/cost/risk from one part to another at the extreme detriment of the system a whole.

Its causes massive distortions and disincentives. In the case of collective bargaining and labor protections, I'll speak about my country, the UK. These laws have crippled the country, especially as of recent.

Its so sad to see a nation that used to be full off dynamism, ingenuity and so much life now turned into a lifeless bureaucratic hellscape..

In what way do you feel unemployment isn't sufficient? It seems to be high enough that people are able to provide for necessities while being low enough to keep them looking for another job...even if it isn't quite as much as they were making before. That seems like it is about the ideal balance.

Alternatively, the bosses can get rid of the guilt, by choosing to believe that unfettered capitalism of the most extreme kind is the natural and correct order of things. Converting costs into externalities (in this case, unemployed people) becomes the new religion.

The boss's morality doesn't enter it anymore; the market made them do it.

I would much rather get a risky tech job in the US than in my current country (UK) where we get paid half or even less than half..

Btw its not just the money either, imagine the kind of companies/opportunities that can survive such extreme collectivism and think about what becomes of the culture/practices/mannerisms in such an environment.

One thing I always wondered about less developed parts of the world like Asia and the middle east is how did they devolve so much? South America and Africa makes sense, those regions didn't develop complex advanced civilisations but India did, China did, Middle east did.. and they did it thousands of years ago then just devolved to pitiful lows. Now it makes sense..

Europe and her children deserves everything that coming to them. The arrogance of these people to think they can play god with humanity and be arbiter of who deserves what..

I hated working in Britain with the BS months lying time and getting paid monthly. In the USA you get paid fortnightly or twice monthly and are paid for the period just past.

If you are working in tech, you can just save let's say quarter of your salary every month as a personal unemployment insurance and still be much better off than some dude working in EU Google office for half your salary (or even less!) with higher taxes.

Employees are equally free to "screw over" companies by terminating their employment at any time; at-will is a two-way street. That seems like a fair and faithful manifestation of a free market.

Health care and insurance is also available without an employer, at least in the US.

Yup individual employees are definitely on equal footing with companies and health care is very affordable when purchased individually. The free market is very good and fair and everything is going just fine!

You are free to create your own asymmetrically powerful business entity to rebalance the odds, if you find them unfair.

Translation: a union.

Do you read your own writing?

Individuals are also responsible for their own reading comprehension skills.

> Employees are equally free to "screw over" companies by terminating their employment at any time; at-will is a two-way street.

Wow. I guess that might seem like a convincing argument if you totally ignore the power imbalance between a terminated employee who loses the ability to pay for basic necessities vs a company that loses the labor of a single person.

The inability for an individual to guarantee payment for necessities cannot be the fault of any company. Each capable adult must be held accountable and responsible for themselves in this world.

Nah I’m pretty comfortable blaming a company for jerking around a new hire, thereby putting their financial status and healthcare needs at risk. That’s shit behavior and deserves to be called out.

Of course, even most free-market types don't belive this. After all, we collectively pay for things like national defense because it very obviously makes more economic sense than each individual trying to defend against a foreign adversary.

No, the "Each capable adult must be held accountable and responsible for themselves" is only trotted out against things a free-market ideologue doesn't like. It's a nonsense argument, and they know it.

You're welcome to make a counter-argument for why an individual is entitled to something in this world, and I would welcome reading it.

And you're welcome to address what I just wrote, instead of trying to dictate that I use an argument you find more convenient for your position.

Frankly, it is difficult to "address" a subjective opinion without having been given the criteria for a satisfactory answer. But I will try: being a responsible adult includes contributing to national defense.

Your original statement, that "Each capable adult must be held accountable and responsible for themselves in this world," is a subjective opinion--unless you meant it merely in the sense of a truism--and you did not give me any criteria for a satisfactory "counter-argument".

Regarding this: >being a responsible adult includes contributing to national defense

you are equivocating between two separate definitions of the word "responsible." Being a responsible adult is not the same as being an adult who is responsible for their own defense or healthcare, for example. They can be correlated, but they have different meanings.

But honestly, this form of internet debating you started that derails from the topic and gets into quasi-logical nitpicking is uninteresting and makes me feel like I'm in a high school, so this will be my last comment. Please feel free to reply, and I will read it. But please make the reply have some substance.

I believe it is you making the false equivalence.

> you did not give me any criteria for a satisfactory "counter-argument".

I had. Many times. I asked for examples of ethical businesses. None were materialized. Therefore my assertion remains unchallenged and likely true.

In, say, Germany, are employees bound to stay with a company until the conclusion of some contract, or are they free to move at will while the employer must retain them?

I think most people in the US arguing for employee protections are assuming the latter, but I'm curious how it actually works in Europe.

In Finland there are fixed-term and permanent contracts. Fixed-term ones are extremely hard to terminate one sidely for both parties (excluding separate terms in the contract like probation period). Permanent contracts require certain amount of notice by default. Employees notice period is 14 days if contract has lasted less than 5 years, 1 month otherwise. Employer's notice period are: 14 days if contract has lasted less than a year, 1 month for 1-4 years, 2 months for 4-8 years, 4 months for 8-12 years and 6 months for over 12 years.

Contract and CBA can affect these. The only restrictions law has is that employee's notice period cannot be longer than employer's and that the maximum is 6 months, but CBA can set minimums. The CBAs that I have read set those law's default notice periods as the minimum. Vast majority (I believe about 80-85%) of employees in Finland are covered by some CBA.

Genuine question: Do you think that people in countries with strong labour laws are signing up to be literal slaves?

I used to work in the UK. I once worked for a company that had a salesperson that wanted to quit. He was forced to do a non-sales job for thirty days stacking boxes and sorting old files before he was allowed to leave and he hated every minute of it.

So yes, sometimes strong labor laws have a hint of slavery to them, but certainly not equivalence to real slavery.

That unusual. He’d only be obliged to continuing his job during his notice period. Not a different job. Sounds like he didn’t know his rights.

Most UK contracts will also include a clause allowing the company to end the employment immediately as long as they still pay out what the employee would have earned during their notice period.

Having been through a few roles in the uk myself, the obligation on the company to give me adequate notice (and pay) has always benefited me.

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