1. Challenges for Trade Unions
The Informal Economy
Challenges for Trade Unions
Barbados, 1-4 December 2008

2. What is 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
Activities operating outside the formal reach of the law
In practice law is not applied or not enforced
Law discourages compliance because it is inappropriate, burdensome, or imposes excessive costs

3. What do we know about the Informal Economy?
Not a homogenous sector:
it covers a wide variety of activities, enterprises and
different types of workers with
diverse employment relationships

4. Informal Employment?
Own-account workers employed in their own informal sector enterprise
Employers employed in their own informal sector enterprises
Contributing family workers, irrespective of whether they work in formal or informal sector enterprises;
Members of informal producers’ cooperatives;
Employees holding informal jobs, whether employed by formal sector enterprises, informal sector enterprises, or as domestic workers employed by households;
Own-account workers engaged in the production of goods exclusively for own final use by their household.
Source: 17th International Conference of Labour Statisticians (ICLS) 2003

5. Characteristics of Informal Economy Work and Workers
Engaged in small and micro enterprises and activities for which data is not regulated and which do not maintain any regular accounts;
Casual, part time, irregular or seasonal employment;
Frequently changing workplaces and employers;
Unclear employer-employee relationship;
Generally not covered under the labour laws;

6. Characteristics of Informal Economy Work and Workers
Poor working conditions
Unorganized therefore no collective bargaining
Minimum wage or piece rate work
Little or no access to
formal sector credit
skills training facilities
No social protection

7. Trade Unions and the Informal Economy: Challenges
Why should unions organize informal economy workers?
How to extend collective action and bargaining to the informal economy?
What kind of initiatives can be taken by unions for informal economy workers?
What campaigns need to be undertaken for legislative protection of informal economy workers?

8. Basic Rights Denied in the Informal Economy
Freedom of Association and Collective Bargaining
No forced or compulsory labour
No discrimination in respect of employment and occupation (includes training, access to employment)
No child labour

9. Basic Rights Denied in the Informal Economy
Safe and healthy working conditions
Reasonable working hours
Severance notice and pay
Paid sick leave and vacation
Maternity leave
Retirement compensation

10. Issues Needing Trade Unions’ Attention
Organizing! Organizing! Organizing! – focus on women and youth
Improving conditions of work
Promoting security
income security
employment security and
safety at work and social security
Legislative protection

11. Issues Needing Trade Unions’ Attention
Promoting rights and protection of women workers, in particular non-discrimination in employment, education, skills training, and credit availability
Elimination of Child Labour especially the worse forms
illegal activities, prostitution, scavenging, and other hazardous activities

12. Obstacles to Organizing
changing workplaces
changing employers
gaining access to the workplace
unions not able or willing to adopt new strategies - actions may be required at other than workplace
Trade unions lack human and financial resources
Traditionally, unionism has been based on –
Existence of employer-employee relationship
Wage earner status of workers in a fixed work place – a factory
... & labour law too has been based on the above assumptions.
But work & employment relations in informal economy do not reflect this reality –

13. Obstacles to Organizing
Attempts to organize often pose risk of denial or loss of work
Traditional ways of thinking about organizing
Often difficult to get recognition of trade union
Legislation often does not cover home-based workers who are often considered as self-employed

14. Approach to the Informal Economy
improve informal enterprises – increase their assets, productivity and competitiveness through a mix of services provision (micro-finance and business development services) and policy interventions;
improve informal jobs – extend the scope of existing legislation to secure the rights of workers, promote collective bargaining and enforce labour standards
protect informal workers – provide social insurance coverage through extending existing schemes and/or developing new schemes, and
promote the ‘voice’ of informal workers – promote organizing of informal workers and their organizations, and promote their representation in relevant policy-making institutions.

15. Fundamental Principles and Rights at Work (1998)
Freedom of association and the right to collective bargaining
No forced or compulsory labour
No child labour
Elimination of discrimination in employment and occupation
a global social floor

16. What Needs to be Done? Recognize and improve workers rights
Enhance social protection
Invest in knowledge and skills of workers
Provide support services
access to credit and technology
create and expand services (health, literacy, education, savings and loans)
raise awareness about unionization
Provide legal and institutional support

17. What Needs to be Done?
Give economic incentives to promote formalization of informal economy activities
Remove barriers to employment creation in formal sectors
Regulate labour supply – rural-urban migration
Develop a strategic programme for organizing
What else?

18. The Informal Economy: Trade Union Challenges
Questions???
Comments!!!