It's more of a problem with big established companies and less in startups really. What I'm familiar with is -- initially everyone gets a temporary 1 year contract. Contract could be not extended, but the company commits to 1 year. After two extensions, you get a permanent one and can't be fired because you look funny to your boss.
Then there is outsourcing, where the contract with their company can be dropped. They are more expensive and have 1 year contracts too. People on permanent contracts have to be persuaded to sign separation agreement and have leverage over you. I have seen some funny examples of management trying to fuck over people for no good reason and then having to continue paying them for 2 years without seeing any output, but that was not a 10 people shop that would go under for it and was self-inflicted too.
They mood in Europe is you as a company owner have to take the risks, not the employees. Which is reflected into salaries of course.
For the startups it's not the problem I saw so far, as they benefit from having to pay lower then otherwise salary, without actually taking the risk. If the company goes under, everyone goes back to job market anyway.
Then there is outsourcing, where the contract with their company can be dropped. They are more expensive and have 1 year contracts too. People on permanent contracts have to be persuaded to sign separation agreement and have leverage over you. I have seen some funny examples of management trying to fuck over people for no good reason and then having to continue paying them for 2 years without seeing any output, but that was not a 10 people shop that would go under for it and was self-inflicted too.
They mood in Europe is you as a company owner have to take the risks, not the employees. Which is reflected into salaries of course.
For the startups it's not the problem I saw so far, as they benefit from having to pay lower then otherwise salary, without actually taking the risk. If the company goes under, everyone goes back to job market anyway.