A Tale of Oversimplification and Deregulation: The Mainstream Approach to Labour Market Segmentation and Recent Responses to the Crisis in European Countries

Abstract

After advocating flexibilisation of non-standard work contracts for many years, some European and international institutions and several policy makers now indicate the standard employment relationship and its regulation as a cause of segmentation between the labour market of ‘protected’ insiders, employed under permanent contracts with effective protection against unfair dismissal, and the market of the ‘non-protected’ outsiders, working with non-standard contracts. Reforms of employment legislation are therefore being promoted and approved in different countries, supposedly aiming to balance the legal protection afforded to standard and non-standard workers. This article firstly argues that this approach is flawed as it oversimplifies reasons for segmentation and concentrates on an ‘insider–outsider’ discourse that cannot easily be transplanted into continental Europe. After reviewing current legislative changes in Italy, Spain and Portugal, I argue that lawmakers have focused on ‘deregulation’ rather than ‘balancing protection’ when approving recent reforms. I question the mainstream approach to segmentation and some of its derivative proposals, such as calls to introduce a ‘single permanent contract’, on the grounds that they neglect the essential role of job protection in underpinning the effectiveness of fundamental and constitutional rights at the workplace.