A substantial portion of the labour literature seems to agree that institutional rigidities are responsible, at least partially, for the poor performance of labour markets. It is strongly suggested that to achieve more efficiency those countries with ‘tight’ labour markets should implement deregulation policies (IMF 2003; OECD 2006). And indeed, in recent years, the International Monetary Fund (IMF) has encouraged European Union (EU) countries, especially EU-Mediterranean countries, to implement labour reforms to build a more flexible labour market (IMF 2012). The recent financial and economic crisis has amplified the tone of these policy suggestions.