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

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

3. 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

4. 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)

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

6. 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.

7. 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)

8. 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)

9. Incidence of undeclared work in Europe

10. 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.

11. 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

12. 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)?