Thursday, October 27, 2005

[IWS] EIROnline: Redundancies and Redundancy Costs [27 October 2005]

IWS Documented News Service
_______________________________
Institute for Workplace Studies Professor Samuel B. Bacharach
School of Industrial & Labor Relations Director, Institute for Workplace Studies
Cornell University
16 East 34th Street, 4th floor Stuart Basefsky
New York, NY 10016 Director, IWS News Bureau
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European Industrial Relations Observatory (EIRO) online
EIRO thematic feature

Redundancies and Redundancy Costs
[27 October 2005]
http://www.eurofound.eu.int/publications/files/EF0575EN.pdf
[full-text, 15 pages]
Author: Kauppinen, Timo and Meixner, Marie

Summary: This comparative study aims at giving an overview of existing national legislation on redundancy, focusing particularly on compensation payment provisions. It further seeks to reflect current debate on the issue and outline new approaches to dealing with redundancies.


[excerpt]
According to legislation in most of the EU15 Member States, collective redundancies are understood as dismissals for
'economic reasons', i.e. effected by an employer for reasons unconnected with the individual employee concerned. Such
dismissals are also referred to as 'collective redundancies'. Furthermore, national legislation set up criteria defining
precisely the circumstances in which redundancy legislation applies, such as, for example, specifying thresholds
according to the number of employees made redundant and/or the size of the company where the redundancies occur.
Thresholds, however, can vary widely from country to country.


[excerpt]
Introduction
The issue of redundancy, and of the financial, social and moral costs it involves, has been the subject of widespread
public debate over the last two decades. Governments, employers and trade unions agree that growing unemployment
resulting from collective dismissals has become a serious economic problem.

Against the background of the social costs of redundancies, rules to limit and mitigate collective redundancies have been
introduced in all the countries examined. Efforts to minimise the negative impact of redundancy have focused on three
kinds of measures: active employment policy, employee participation in the redundancy process, and severance pay. For
many years, the latter measure has been the most important one. Aimed at creating an incentive for employers not to
dismiss employees, statutory compensation payments have been introduced in many countries. On the other hand,
severance pay has been used as an inducement to employees to abandon jobs in the face of declining demand for their
labour.

Thus, this comparative study aims at giving an overview of existing national legislation on redundancy, focusing
particularly on compensation payment provisions. It further seeks to reflect current debate on the issue and outline new
approaches to dealing with redundancies.


AND MUCH MORE...including TABLES....
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Institute for Workplace Studies *
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