Indeed, available empirical evidence typically suggests that, when targeting employment protection on a specific group of workers, legislation usually induces substitution across groups as regards hiring (see e.g. Acemoglu and Angrist, 2001, Femandez-Kranz and Rodriguez-Planas, 2011). Blanchard and Wolfers (2000) and Nickell et al. ( Recent OECD work, identifying the effect of dismissal restrictions on employment through the likely heterogeneity of its effects across industries or firm types, find that these regulations reduce employment resilience to output shocks (e.g. OECD, 2011a, Bassanini, 2012), which helps explaining the limited employment elasticity of the recent recession (Gal et al.,