Who is Protected by Employment Protection?
Abstract
Abstract This paper examines how loosening employment protection legislation (EPL) affects workers with different characteristics. Exploiting a 2012 Italian law, the “Fornero Reform,” and using a difference-in-differences strategy on administrative data, we causally estimate heterogeneous effects on termination rates by sex-age, job rank, income, industry, and tenure. We find a relative increase in terminations for high-tenure, white-collar, and manufacturing workers. Though not direct evidence, this suggests that the stricter EPL was providing more protection to these worker groups on average. Further, the high-tenure increase may indicate that poor performers were protected for many years pre-reform. Our findings add to the EPL heterogeneous effect literature and limited work on the interaction between EPL and tenure.
Fields of Study & Subjects
Employment and Welfare Studies
Labor Movements and Unions
Social Policy and Reform Studies
Publication details
- Journal / source
- The B E Journal of Economic Analysis & Policy
- Publisher
- Walter de Gruyter GmbH
- Volume
- 26
- Issue
- 3
- Pages
- 827–852
- Publication date
- 22 April 2026
- Language
- EN