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Redundancy Pay, Unions and Employment

Booth, Alison L and McCulloch, Andrew (1999) 'Redundancy Pay, Unions and Employment.' Manchester School, 67 (3). pp. 346-66. ISSN 1463-6786

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Abstract

In this paper, the authors estimate the determinants of bargaining over redundancy pay, and its impact on employment variation and financial performance, using the 1990 Workplace Industrial Relations Survey. The estimates indicate that bargaining over redundancy pay is more prevalent in plants with a strong union presence. However, voluntary negotiation of redundancy pay does not appear to reduce employment variability in the face of small demand shocks. Bargaining over manual redundancy pay has an insignificant impact on plants' financial performance, while bargaining over nonmanual redundancy pay has a large significant positive effect. The authors' findings may explain the positive attitudes to redundancy pay reported by some employers, and reinforce the general conclusion of cross-country studies that firing constraints in Britain may be relatively unimportant in preventing labor market flexibility.

Item Type: Article
Subjects: H Social Sciences > HB Economic Theory
Divisions: Faculty of Social Sciences > Economics, Department of
Depositing User: Jim Jamieson
Date Deposited: 18 Jul 2012 10:48
Last Modified: 18 Jul 2012 10:48
URI: http://repository.essex.ac.uk/id/eprint/3177

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