Friday, June 8, 2007

EU Labour Market Policies and Wage differentials

Evaluate how EU labour market policies might affect wage differentials between men
and women in the UK?

not an easy question. Need to first be aware of EU labour market policies. These are from the EU social chapter

EU Labour Market policies include:

  • Maximum working week
  • Minimum wage
  • Extension of Full time rights to part time and temporary workers
  • Works councils,
  • parental leave,
  • regulation on sexual harassment,
  • minimum wage,
  • minimum four weeks' paid holiday,
  • 40-week maternity leave

  • Extension of full time rights to part time workers may benefit women more than men. This is because women are more likely to work in part time / temporary jobs.
  • The same is true for minimum wage legislation. It is more likely to benefit female workers, because they are more likely to do part time / service sector jobs, which benefit from a minimum wage.
  • However, on the other hand it could be argued the increased legislation may make firms less willing to take on female workers. If women are likely to receive generous maternity leave, the firm may be inclined to pay less so that it can afford to pay maternity leave (more likely they will just not get taken on)
  • Maximum working week is more likely to apply to men. Women are more likely to do part time / temporary jobs. This will reduce the total take home pay for men (as opposed to hourly wage) This will bring total earnings of men closer to women.
  • The legislation has its limitations. Differences in wages are due to many factors such as; women choosing lower paid jobs, taking career breaks and therefore not getting promoted. Therefore these legislation may not tackle the fundamental reasons for imbalances.

See also: Why Women Get paid less than men

The EU and the Social Chapter

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