Convergence of Social Policy and Labour Regulation: The European Equation

(2018) 4(2) Nottingham Insolvency and Business Law e-Journal 11

16 Pages Posted: 20 May 2021

See all articles by Jennifer L. Gant

Jennifer L. Gant

University of Derby - School of Law and Criminology

Date Written: December 12, 2016


Labour and employment regulation is a complex and ever changing area of the law fed by social and economic policy, politics, external and internal pressures, and cultural influences. In isolation, labour regulation is particular to the country in which it is found. However, in a world growing smaller due to globalisation,2 the differences in labour regulation between jurisdictions can become an issue in cross-border business transactions and may even affect a multi-national company’s choice of investment. The flexibility of labour regulation can affect the attractiveness of a jurisdiction, as evidenced by the outsourcing of labour intensive sectors of many corporations to developing countries which lack the expense of protective labour regulation and benefit from a cheaper labour force.3
Legal systems within the EU have been on a process of slow convergence since the 1950s. However, in examining legal systems with a view to determining their core similarities, some exhibit areas of convergence while other aspects remain quite different.4 Even when comparing those systems that are similar, there remain distinctive characteristics distinguishing one from another. There are differences that seem irreconcilable even within legal groups such as those jurisdictions adhering to the common law or civil law systems. While certain rules and solutions may seem alike, legal cultures and traditions can differ significantly,5 leading to fundamental differences in approach to regulation and policy initiatives. These differences in approach are influenced by aspects of culture and history which cannot easily be separated from the legislative process. Convergence therefore becomes more difficult with culture bound areas of the law, such as labour and employment.

EU social policy has aimed to harmonise standards based on a minimum floor of rights7 to a level which is more reflective of what is present in the more socially progressive countries, such as France. However, lack of concrete EU wide definitions have made coordination in social policy difficult. Though similar terms to describe elements of procedure may be used, the ideologies and policies informing the objectives of those procedures create a barrier to mutual understanding and an obstacle to coordinated action. The question remains then as to how it may be possible to find a means of coordinating the law in order to create a more balanced environment for cross border business. In discovering the influences on the aims of socially oriented regulation, it may be possible to identify areas where coordination and perhaps convergence may be realistically attempted and to work around those areas in which the different social aims make such convergence impossible or at least improbable in the near future.

In order to attempt an alignment of labour systems in the EU, which of itself is a potentially unrealistic suggestion, at least in the current political climate and particularly following the United Kingdom’s referendum outcome and pending exit from the EU, an understanding of the fundamental values which have influenced a country’s approach to employment law and social policy is vital. Any EU level coordination would require diplomacy and compromise, a full knowledge and understanding of the elements of the systems being the most important tool to guide any such process. Though the current political crisis of 2016 gives little hope toward this end, an understanding of the underlying factors that influence jurisdictional approaches to social policy and employment law may be a useful exercise in the event that the crisis is resolved and harmonisation, or at least a managed convergence, again becomes an aim of EU social policy.8 To this end, an analysis of the historical context of labour regulation and the working classes will reveal much about the fundamental values upon which labour systems and employment regulation are based, and the differences between them. A typically top-down technical analysis would only expose a positivist view of the law,9 isolated from its constituent parts without which it would not exist in its current form. The comparative perspective presented is not only useful for the development of solutions, but also for the discovery of other alternatives.10 This unique methodology could then be relied upon as a means finding a path to greater coordination by attempting to align systemic values in the future, should the EU survive the political turmoil that has engulfed 2016.

Keywords: insolvency, employment protection, cross-border insolvency, social policy, European Union, path dependence, employment regulation, labour law

JEL Classification: G3, J8

Suggested Citation

Gant, Jennifer, Convergence of Social Policy and Labour Regulation: The European Equation (December 12, 2016). (2018) 4(2) Nottingham Insolvency and Business Law e-Journal 11, Available at SSRN: or

Jennifer Gant (Contact Author)

University of Derby - School of Law and Criminology ( email )

Kedleston Road
Derby, Derbyshire DE22 1GB
United Kingdom

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