Critiquing the OECD’s Employment Protection Legislation Index for individual dismissals: The importance of procedural requirements

Key EU agencies have successfully urged member states to scale back employment protection legislation as a solution to unemployment. The economic arguments for this reform are mixed, with recent empirical evidence largely unsupportive. Critics have also raised doubts about the accuracy of the OECD’s Employment Protection Legislation Index, which is the principal method EU agencies use to target so-called high-protection regimes. This article supplements existing criticisms of the OECD index by arguing that it fails to account for procedural requirements in assessing the difficulties and costs of carrying out individual dismissals. Evidence from New Zealand, ostensibly a low-protection country, demonstrates procedural requirements can pose the main impediments to carrying out individual dismissals. This suggests the need for revision of the OECD Employment Protection Legislation Index or the use of other indices instead.


Author(s) M. Harcourt, G. Gall, A.S. Raman, H. Lam, R. Croucher
Language English
Year of publication Jun, 2019
Journal Economic and Industrial Democracy
Volume 2019
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