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May 05, 2005

When Leaving a Job Isn't an Option

Conservatives often argue that workplace regulations are unneeded, since the threat of employees quitting for a better job is all the protection any worker needs. Employers compete for employees, so wages and work conditions improve through the wonders of the free market.

Even if we ignore the horrific conditions of sweatshops, this conservative argument ignores the reality that many employers bar employees from working for competing companies. So once you take a job, you lose the leverage to demand better treatment:

Thirty percent of human resource executives surveyed...in March 2004 said their companies required employees to sign noncompete agreements...
Now, there is a good argument that employees shouldn't be able to run off with business secrets and company lists, but if employees are going to be restricted in whether they can leave a firm, they need alternative protections of their rights-- namely strong regulation and, ideally, union collective bargaining rights, a point I made in this law review article a few years ago.

But the basic point is that "the labor market" doesn't function the way libertarian utopians try to picture, which is why strong regulations and unions are needed in the first place.

Posted by Nathan at May 5, 2005 05:21 AM