Michael Frosch ILO Department of Statistics Revision of International Classification of Status in Employment (ICSE-93) Michael Frosch ILO Department of Statistics ILO Department of Statistics

Process Working group (met four times from May 2015-September 2017) Regional meetings Tripartite Meeting of Experts (February 2018) Next step Present and discuss at the 20th ICLS in Geneva (10-19 October 2018)

Main conclusion from MoE In general a strong support for the new framework Strong support for structuring ICSE-18 in two different hierarchies: according to type of authority and according to type of economic risk For the inclusion of the different forms of work in ICSaW-18 Several minor clarifications, changes, updates Dependent contractors: strong but not universal support for inclusion of dependent contractors. There was a need for further work on details of the definition and operationalisation Definition of employers: Proposed boundary of having employees in the reference period was supported by some but opposed by others preference for using ‘regularly’ engage employees as boundary. Employees: Boundary to distinguish fixed-term from short-term and casual employees, which was proposed as 1 month. Several experts preferred a change to three months which would Ensure the group might be large enough to measure in typical household surveys Better align with legal and administrative concept of short-term employment in several countries Cross cutting variables: domestic workers, multi-party relationship and reasons for non-permanent job required substantial redrafting ILO Department of Statistics

Dependent contractors Proposed definition “workers employed for profit, who are dependent on another entity that exercises explicit or implicit control over their activities and directly benefits from the work performed by them” The dependency might be of an operational nature, through organization of the work and/or economic nature such as through control over access to the market, the price for the goods or services produced, or access to raw materials or capital items In addition a set of characteristics that do apply, may apply and that excludes workers from being defined as dependent contractors are stated Gives a direction on possible operationalization of the identification of dependent contractors Create a degree of flexibility ILO Department of Statistics

Outline of proposed new standards for statistics on the work relationship Conceptual framework for statistics on the work relationship defines the key concepts, variables and classification schemes to be included in the new standards Revised international Classification of Status in Employment (ICSE-18) Comprises ten categories applicable to employment and that can be organised in two different hierarchies International Classification of Status at Work (ICSaW-18) Extension of the classification of Status in Employment to cover all forms of work, including own-use production work, volunteer work and unpaid trainee work, as well as employment. A set of cross-cutting variables That supports the derivation and analysis of the status at work categories Guidance on measurement ILO Department of Statistics

ICSaW-18 ICSE-18-A versus ICSE-93 -Employment -Own-use production work I Independent workers 1 Employers 11 Employers in cooperations 12 Employers in household market enterprises 13 Employers in own-use production of services 14 Employers in own-use production of goods 2 Independent workers without employees 21 Owner-operators of corporations without employees 22 Own-account workers in household market enterprises without employees 23 Independent workers in own-use production of services without employees 24 Independent workers in own-use production of goods without employees 25 Direct volunteers D Dependent workers 3 Dependent contractors 30 Dependent contractors 4 Employees 41 Permanent employees 42 Fixed-term employees 43 Short-term and casual employees 44 Paid apprentices, trainees and interns 5 Contributing family workers 51 Contributing family workers 52 Family helpers in own-use production of services 53 Family helpers in own-use production of goods 6 Unpaid apprentices, trainees and interns 60 Unpaid apprentices, trainees and interns 7 Organization-based volunteers 70 Organization-based volunteers 9 Other workers 90 Other workers -Employment -Own-use production work -Unpaid trainee work -Volunteer work -Other work activities 5 Family helpers ILO Department of Statistics

Classification of status based on the type of economic Risk (ICSE-18-R) Workers in employment for profit Employers in household market enterprises Own-account workers in household market enterprises Dependent contractors Contributing family workers Workers in employment for pay Owner-operators of corporations Employers in corporations Owner-operators of corporations without employees Employees Permanent employees Fixed-term employees Casual and short-term employees Paid apprentices, trainees and interns

Cross-cutting variables The classification is complemented by a set of cross-cutting variables that provides information for characteristics that cut across several status categories Output variables and categories to promote greater harmonization, coherence and international comparablity Many of these are regulary covered by most LFS but are not in general covered by international standards ILO Department of Statistics

Cross-cutting variables Required Duration of work agreement Type of employment agreement Contractual hours of work Forms of remuneration Place of work Job-dependent social protection coverage Reason for non-permanence of job Essential Duration of employment in the current economic unit Seasonal workers Preference for a non-permanent job Usual hours worked Full-time/part-time status Domestic workers Home-based workers Multi-party work relationships Paid annual leave Paid sick leave Recommended number of employees in the economic unit in which the worker is employed main form of remuneration reasons for preferring a non-permanent job ILO Department of Statistics

Data collection guidelines ILO have in parallel develop a first draft of measurement approached that can be used as guidelines by countries for collecting ICSE-18 and the cross-cutting variables Dynamic guidelines Based on current practices and test results Household surveys (LFS), Administrative sources, establishment surveys ILO Department of Statistics

Testing ICSE-18 Tests have been / are carried out in: Thailand, Singapore, Finland, Denmark, Italy, Mexico, Chile, Ecuador, Uruguay, El Salvador and the Pacific community Cognitive testing as well as field tests Has focussed mainly on the identification of dependent contractors among self perceived self-employed, testing different operationalization exercise of operational authority by main client if the client or intermediary provides the material input control over setting the price for goods or services produced To a lesser extent on the identification on dependent contractors among self-perceived employees ILO Department of Statistics

Conclusions so far Shows questions are generally understood well by respondents Numbers are small in some countries and more significant in others approximately 0.5 pct. of total employment in DK approximately 5 pct. of total employment in Thailand only includes identification from one track Sensitive to type of operationalization Small overlap between the different approaches Different characteristics in age, educational level, industry, occupation turnover, working time Relative high share of dependent contractors in agriculture especially when using price control. Dependent contractors in agriculture needs furhter work ILO Department of Statistics

Next steps 20th ICLS in Geneva 10th to 19th October, 2018 Possible to access and comment on the draft resolution before the meeting in the electronic forum Testing continues and will continue after the ICLS Partners sought for testing on dependent contractors (both self-employed and employees) and other issues such as zero hours contracts, multi party relationships Tests will be feed into the development of data collection guidelines, operationalization ILO Department of Statistics

Thank you ILO Department of Statistics

Characteristics of Dependent contractors Do display the following characteristics: their work is organized or supervised by another economic unit as a client, or as an entity that mediates access to clients the mode of payment is by way of a commercial transaction. May display the following characteristics: the price paid for the goods produced or services provided is determined by the client or an intermediary; access to raw materials, equipment or capital items is controlled by the client or an intermediary; their actual working arrangements or conditions may closely resemble those of employees; the entity on which the worker is dependent does not withhold income tax for the worker; the worker is responsible for arranging his or her own social insurance and other social contributions Excluded are workers who: have a contract of employment (formal, informal, or implicit) with the entity on which they are dependent; are paid for time worked; employ one or more other persons to work for them as an employee; or operate an incorporated enterprise. ILO Department of Statistics

Three steps structure s STEP 1 Self-identified status in employment Self-employed - Classification module Contributing family workers - Classification module Employees - Classification module STEP 2 Sub-classification module STEP 3 ILO Department of Statistics

Step 2 For self-employed (possibly 4 questions) Identify if they have employees and are incorporated or not (employer vs own account worker) If not incorporated and no employees assess if a dependent contractor (different possible approaches) For employees (possibly 3 questions) Identify payment type (wage, salary, profit) Identify responsibility for taxes/social security contributions For CFW (possibly 2 questions) Identify if payment received Identify role in decision making (can be reclassified to employer/own account worker) ILO Department of Statistics

Third step Sub-classification modules targeting classified: Employees Features of the contract (permanent, fixed term, duration) Guarantee of hours (zero hours) ILO Department of Statistics

ICSE-18 ILO Department of Statistics

Classification module for SI Self-employed Having employees in the reference period (all SI Self-employed) Eneterprise is incorporated or not (all SI Self-employed) ILO Department of Statistics

Classification module for SI Self-employed cont. Option: Control over setting the price for goods or services produced ( Own-account workers in household market enterpises) ILO Department of Statistics

Classification module for SI employees Type of remuneration (all SI employees) Option 1. Responsibility for social insurance or deducting income taxes For this work are you paid.. (Mark all that apply) A wage, salary By piece -Commissions, tips Fee for services Profit Unpaid OR ILO Department of Statistics

Classification module for SI- CFW Might be relevant for some countries Type of remuneration For this work are you paid.. (Mark all that apply) A wage, salary By piece -Commissions, tips Fee for services Profit Unpaid Operational decisions ( Not yet decided) ILO Department of Statistics

Sub-classification module for employees Guaranteed amount of hours (all employees) ILO Department of Statistics

Sub-classification module for employees Employment agreement is open-ended or limited (all employees) The duration of the limited employment (employees with limited contract/agreement) ILO Department of Statistics

Classification of status based on type of Authority/dependency (ICSE-18-A) Independent workers Employers Employers in corporations Employers in household market enterprises Independent workers without employees Owner-operators of corporations without employees Own-account workers in household market enterprises  Dependent workers Employees Permanent employees Fixed-term employees Casual and short-term employees Paid apprentices, trainees and interns Dependent contractors Contributing family workers