The impact of mandatory entitlement to paid leave on employment in the UK
"I evaluate the impact of the UK Working Time Regulations 1998, which introduced mandatory paid holiday entitlement. The regulation gave (nearly) all workers the right to a minimum of 4 weeks of paid holiday per a year. With constant weekly pay this change amounts effectively to an increase in...
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| Institution: | ETUI-European Trade Union Institute |
| Format: | TEXT |
| Language: | English |
| Published: |
London
2014
LSE |
| Subjects: | |
| Online Access: | https://www.labourline.org/KENTIKA-19110540124919387229-The-impact-of-mandatory-entitl.htm |
| Summary: | "I evaluate the impact of the UK Working Time Regulations 1998, which introduced mandatory paid holiday entitlement. The regulation gave (nearly) all workers the right to a minimum of 4 weeks of paid holiday per a year. With constant weekly pay this change amounts effectively to an increase in the real hourly wage of about 8.5% for someone going from 0 to 4 weeks paid holiday per year, which should lead to adjustments in employment. For employees I use complementary log-log regression to account for right-censoring of employment spells. I find no increase in the hazard to exit employment within a year after treatment. Adjustments in wages cannot explain this result as they are increasing for the treated groups relative to the control. I also evaluate the long run trend in aggregate employment, using the predicted treatment probabilities in a difference-in-difference framework. Here I find a small and statistically significant decrease in employment. This effect is driven by a trend reversal in employment, coinciding with the treatment." |
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| Physical Description: | 80 p. Digital |