During the recent recession, many companies have instituted wage freezes, dropped health care coverage, and increased hours of work to maintain profitability. According to the industrial relations school, the competitive forces of the economy, and employees' rights to quit and find another job, provide a sufficient "check and balance" system to ensure that other employers do not take advantage of the poor economy simply as a way to decrease the share of profits that are paid to labor.

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The industrial relations school argues that the power imbalance between employers and employees means that the competitive forces of the economy and the right to quit are not sufficient to prevent exploitation. They believe in the need for collective bargaining, labor laws, and other forms of intervention to protect workers' rights and interests.

During the Recent Recession, Many Companies Have Instituted Wage Freezes