Well; yes and no. If it's really difficult to fire people, like it is in many places in Europe, hiring is also less likely to happen. People tend to cling to jobs once they have attained 'unfireable' status.
An alternative solution: make firing people easy, but provide some support to those who get fired. That has costs and benefits too, and is a discussion probably best left to another site. Its main benefit is that it moves the provisioning of "social assistance" from companies, who are no longer forced to hold on to unproductive/unneeded workers, to the government.
It's not the gov't regulation that is the problem but how integrated your job is to your lifestyle. You can't rent an apartment without either having a sufficiently large deposit or having your employer cosign for you. You can't open a bank account without having a job (for example, after arriving in Paris, I walked into HSBC to open an account with 2000€ cash, the manager said I should take it to the post office).
Firing someone is not the problem, it's the ensuing lawsuit that's the problem. If it's not done in a particular way you may end up paying an entire years salary instead of a few months.
Sounds like your opinon on this topic ends up depending on your locale. In America, you can walk up to a bank and open an account with $20 no questions asked. It's been a few years since I rented an apartment, but I only needed an extra month's rent for a security deposit.
As far as lawsuits go, that is really more about government regulation. Depending on the what the regulations say, getting sued may or may not be a real concern.
As an American it was a shock to me too I asked the bank why I couldn't open an account and the manager said I'd be better served by the post office. The reason I wanted to use HSBC is so that my French and US accounts could be integrated. But because I was working as a bartender I guess I wasn't the type of client they wanted. Here, classism is rampant and if you aren't in the right circles or profession doors are closed.
Also, it's very hard to evict someone. It takes a few years and the other person lives rent free. So your choices are to either put up an incredibly large deposit (+30,000€) or have your company guarantee the contract. In my case I just started a new job when I got my apartment. So I put down 22,000€ deposit. People are nicer when you write large checks :)
As for lawsuits. It's not the suit companies are worried about. But the lawyers fees. Labor law, here, is very exact and certain things have to be carried out before you can be fired. A lot of companies just settle because it's cheaper than what the lawyer would charge. Actual lawsuits are rare. A person intelligent to bring a lawsuit and have the funds to retain a lawyer usually doesn't have a problem finding work.
This is likely due to you being an American citizen or green card holder:
American authorities have lately completely disregarded that some people may expatriate for completely legitimate reasons, and American crackdowns and IRS rules makes it exceedingly unattractive for any non-American financial institution to deal with American customers.
The minimal gain opposed to the guaranteed hassle of dealing with American authorities and rules simply isn't worth it for most foreign banks.
Yes, I know this - but life's not always fair now is it ?
In this particular case it might not be a problem since Max can keep an eye on his employees , but as soon as you have a manager - you might be very afraid to get on his bad side (maybe in an argument over something technical or a complaint about your chair) for fear of getting fired.
Life may not be fair in every situation, but if you were really creating value for the company it shouldn't be too hard for you to find another job that may even furnish you with a proper chair.
Me either, seems to go from one extreme ("Can't touch the employee") to another ("Yeah you can dump them if they dress badly"). I'm hoping to attribute it to just the way it's written though but it does come across like you said.
It's great that you can fire people when you want, but it sucks if you're the one getting fired.