Tuesday, July 20, 2010

Trial periods: employment and discrimination

When the government announced its plan to extend the 90-day employment trial period to cover all new workers, it did so on the basis that the trial periods had been "a huge success" at creating jobs. Unfortunately, as Derek Cheng points out in the Herald this morning, the evidence doesn't support that. While the Department of Labour's review found that trial periods appeared to have encouraged 40% of employers to hire people, it also noted that

without any counterfactual evidence it cannot be stated categorically that trial periods had created extra job opportunities. The international literature suggests that exemptions to employment protection legislation, such as the trial period legislation, increase both hiring and firing but have an unclear overall impact on unemployment.
Or, to put it more bluntly: they had no way of telling if the result was real, or if employers were telling them what they wanted the government to hear for political reasons.

One thing trial periods do create, however, is discrimination. According to the survey, 43% of those hired under trial periods were young people aged 15 - 24. This is massively larger than the proportion of young people in the general population, or of young people currently looking for work, so the upshot is that young people are significantly more likely to have a trial period imposed. In other words, employers are offering young people less favourable terms of employment on the basis of their age, in direct violation of the Human Rights Act.

"But its not age, it's experience!" people will cry. Bullshit. The report also notes that of the people hired on trial periods, only 10% were first time workers. In other words, the vast majority of young people forced onto trial periods had experience; employers chose to disregard that, seeing only the young face in front of them.

This is discriminatory, and it is unlawful. And rather than expanding this behaviour, the government should be putting a stop to it.