It can, if it helps the employees feel they aren't going to be fired on a whim, or fired if the the share price drops and the execs feel the need to look tough and prop up their stock options by firing people.
Legislation can acheive this, it can also fuck things up by making people complacent, fat and lazy, or resentful about the woman in the office who gets five years off to have five kids and who still gets a promotion.
Employees constantly fearful for their job are going to spend their time covering their butts and looking for other jobs instead of trying to do a good job.
On the average its in a nations interest to have a motivated and efficient workforce, legislation can help this.
Positive motivation works much better than negative fear.
(My 'experience' was spending four years in a company which cut 20-30% every quarter. They started with 1200 and I made it to the last 20 (I know the maths probably doesn't work - meh) )
Fuck Israel