Kazarian, you have hit on the key. The 20% reduction is to job happiness, not overall happiness. That's just a small part of overall happiness, and not a very important one. Food and housing are much more important. A low job rating will cause some Tropicans to look for other work, but most of them are satisfied to have any work at all.
Sorry Caddet! You choose to disagree with the game designers about how important "job happiness\satisfaction" is. When they provide the panels to look at individual people's data, # four repeats job and housing happiness - making it easy to check these items. In fact, job happiness is far more important than you credit it.
I have noticed that sometimes they will actually be more productive on Easydoes It. If it is on Sweatshop, they work longer days. They get tired out quicker and then it takes them longer to get back to work. On the Easydoes It mode, they seem to balance work and everything else better.
That thought has been expanded and further tested; and it has merit. I have also discussed that "Easy Does It" is a last minute substitution for Union Contract, or Union Rules.