Labour Administration and Inspection Programme Defining Undeclared Work in Europe René Robert Labour Administration and Inspection Programme LAB/ADMIN Geneva

Undeclared work. Also referred to as… Informal Economy Moonlighting Shadow Economy Illegal Work Hidden Labour Concealed Employment

ILO perspective The ILO views undeclared work through the lens of the informal economy All economic activities by workers and economic units that are – in law or in practice – not covered or insufficiently covered by formal arrangements 2002 ILC Declaration on the informal economy

ILO perspective cont’d “[Employment] which does not comply with the requirements of national laws, regulations and practice” Employment Policy (Supplementary Provisions) Recommendation, 1984 (No. 169)

OECD Definition “[Employment]…which, while not illegal in itself, has not been declared to one or more administrative authorities…”. OECD Employment Outlook1986

EC Definition “The concept of ‘undeclared work’ is taken to mean any paid activities that are lawful as regards their nature but not declared to the public authorities, bearing in mind that differences in the regulatory system of Member States must be taken into account.” Communication of the Commission on Undeclared Work, COM (98) – 219.

Legal definitions of undeclared work in the EU LEGAL definitions of undeclared work at the national level in Europe are UNCOMMON Many European countries have NO FORMAL DEFINITION of undeclared work in law (e.g. Bulgaria, Hungary, Latvia, Portugal, Spain) Some countries have a DEFINITION IN THEIR LABOUR LAW (e.g. France, Lithuania) In other countries such as the UK, UNDECLARED WORK MEANS DIFFERENT THINGS to different government agencies (e.g. tax, immigration, OSH, business compliance)

Forms of undeclared work in the EU % of all undeclared work: EU-27 Undeclared wage employment 20 Self-employment for family, friends, neighbours & acquaintances 55 Self-employment for other private persons/households Other/don’t know/refusal 5 Source: European Foundation – Tackling Undeclared Work in the European Union (2009)

Incidence of undeclared work in Europe

Why is defining undeclared work important? A clear definition is important for: Properly understanding the scope of undeclared work; Building an effective legal and administrative response to undeclared work; Ensuring that undeclared work is dealt with consistently within a country or across the European Community.

Issues for Labour Inspection To help IDENTIFY undeclared work in the workplace To help PLAN strategies to address undeclared work To help TRAIN inspectors on undeclared work To help with AWARENESS RAISING and PREVENTION To better COLLABORATE with other authorities (countries) and develop an INTEGRATED APPROACH

Points for discussion What are the key elements or references for defining undeclared work? Does a national definition change the effectiveness of a labour inspectorate’s response to undeclared work? How can a common definition and understanding of undeclared work be coordinated within a country (i.e. between inspectorates and other government agencies)?