Labour laws in the context of globalisation

• Autore: Bob Hepple
• Pagine: 511-523

Bob Hepple*

Labour laws in the context of globalisation**

S: 1. Introduction. - 2. e argument. - 3. Defects of the orthodox view. - 4. Economic models. - 5.

Political models. - 6. Which of these models of‌fers states the optimum comparative institutional advan-

tage? - 7. Conclusion: the alternatives.

1. Labour laws are at the centre of debates about how to respond to economic glo-

balisation. When, in April 2006, the French Government caved in to massive street

protests against the contrat première embauche (CPE), students and trade unions were

triumphant that they had preserved the philosophy of universal job security. But e

Economist (and many economists) criticised the French state for failing –unlike France’s

bouyant private sector- to face up to, and accept, the consequences of global capitalism,

which demands the end of what were described as “rigid”, “over-protected” labour mar-

kets. In May 2006, when General Motors cut 900 jobs at its Vauxhall plant, and warned

of possible closure in Britain, trade unions blamed Britain’s weak job security laws which

make it cheaper to dismiss workers as redundant in Britain than elsewhere in the EU, a

charge denied by Gordon Brown, the Chancellor of the Exchequer.

Who is right? For extreme free trade advocates who favour the removal of all barri-

ers on free trade and investment accompanied by the deregulation of labour markets the

issue is simple. Labour laws are seen as much a determinant of comparative advantage as

natural endowments, resources and preferences. At the other extreme, protectionists

argue for safeguarding national markets and domestic labour laws against external pres-

sures for “f‌lexibilisation”. Most politicians in developed and developing countries are

seeking a path between these extreme versions of free trade and protectionism. For me,

as a scholar and practitioner of labour law, the question is how global processes can be

better regulated in order to deliver both economic growth and social justice embedded

in the rule of law. ere is a rapidly expanding body of literature on the subject mainly

written by economists, political theorists and trade specialists. I ventured into this con-

troversial area in my recent book on Labour Laws and Global Trade1 for two reasons.

First because of a belief that the rules and practices governing productive work are as

essential as property rights for the functioning of the market economy. Secondly, labour

laws also have an important moral dimension – the idea embodied in the ILO Constitu-

* Sir Bob Hepple QC FBA is Emeritus Master of Clare College and Emeritus Professor of Law, University

of Cambridge.

** Professor Edoardo Ghera has made an outstanding contribution to both national and international la-

bour law. It is, therefore, with great respect and admiration that I of‌fer this paper for publication in his

Liber Amicorum.

1 Hepple 2005, on which this paper draws extensively. It is a revised and expanded version of a keynote

address delivered at the Conference of the Society for the Advancement of Social Economics, Trier, July

2006.