The Informal Economy

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The Informal Economy Strengthening the Role
of Trade Unions. Trade Union Response Needed
Sergejus Glovackas, ICFTU CEE Unit
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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 
Informal employment (without secure contracts,
worker benefits or social protection) both
inside and outside informal enterprises
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What is not the Informal Economy?

• Criminal or illegal economy

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Why is the Informal Economy Growing?

• Inappropriate legal and institutional frameworks
  and lack of good governance
• Global employment deficit and failure of
  macro-economic policies
• Growing poverty
• Demographic patterns, including labour surplus,
  migration and effects of HIV/AIDS
• Globalization and impact on new organization of
  production and work

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Informal Economy Action Plan

• Recognizes that all those who work have rights
• Promotes understanding that any job is better
  than no job
• Addresses both the causes and manifestations of
  informality
• Focuses on quantity and quality of jobs
• Combines a focus on both informal economic units
  and workers
• Aims at reducing economic and social deficits for
  enabling entry into the mainstream economy

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Strengthening organization and representation

• Promoting an enabling environment (legal
  framework and governance) for effective exercise
  of the right to organize and bargaining
  collectively
• Devising and strengthening innovative forms of
  action by traditional partners
• Removing obstacles to the formation of
  organizations of workers and employers and
  helping them to organize
• Developing broad-based and all-inclusive dialogue
  and strategic alliances

What types of organizations exist?
Why do they disappear ?
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ICFTU, ETUC and GUFs should

• Reconsider how Global Unions own structures and
  activities can be improved to integrate IE
  workers organisations and
• Collaborate better with NGOs/networks that
  support them, e.g. In the ICFTU Task Force on the
  informal economy
• Encourage and support affiliates to organise all
  workers across the Formal-informal spectrum
  this includes not only those in highly affect
  sectors but also other sectors where the impact
  is not so visible and unions still concentrate on
  the formal economy
• Promote information exchange and pilot programmes
  for IE workers organisation, including exchanges
  between activists, particularly between CEE
  countries and the South
• Take advantage of the new approaches in the ILO
  to support and promote policies to combat
  deregulation and its manifestations such as
  sub-contracting and temporary work agencies, to
  widen the scope of the employment relationship,
  etc. Offer technical assistance, etc.

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ICFTU, ETUC and GUFs should

• Offer technical assistance, etc.
• Promote co-operation between the unions of the
  CEE region. Assist them to promote to convince
  workers of the value of collective action
• Strengthen contacts between unions of CEE
  countries and Western Europe where CEE migrants
  work consider mechanisms for promoting
  cross-border union recognition
• Bring more pressure on the European Union to
  develop migration policies that are less
  restrictive and more based on human and workers
  rights
• Ensure that labour Directives cover the
  self-employed and other forms of informal
  employment
• Affiliates should recognise the need to provide
  resources for this work.

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All TUs, nationally and internationally, should

• Agree that these issues are worth fighting for,
  to protect the most vulnerable workers and to
  ensure the survival of the trade union movement
  educate members and officials on this allocate
  the necessary resources
• Place a major emphasis on organising workers in
  the IE
• Encourage the training of organisers who
  understand the issues, where possible taken from
  the target groups themselves
• Change union statutes so as to make them more
  open to informal workers
• Campaign for the revision of the law where this
  is needed
• Develop collaboration with labour-friendly
  NGOs, international networks, etc.
• To exchange information and share good practice
• Link up with meetings on the same topic in other
  world regions, organised by such organisations as
  WIEGO, IFWEA, Commission for Asian Women, etc.

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ILO 90th Session, 2002

• TUs can sensitise workers in the informal economy
  to the importance of having collective
  representation through educational programmes
• TUs can also make efforts to include workers in
  the IE in collective agreements
• With women accounting for a majority in the IE,
  TUs should create or adapt internal structures to
  promote the participation and representation of
  women and also to present their specific needs
• TUs can provide special services to workers in
  the IE, including information on their legal
  rights, educational projects, etc.
• There is also a need to develop and promote
  positive strategies to combat discrimination of
  all forms, to which workers of the IE are
  particularly vulnerable.

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Useful Web Links

• ICFTU www.icftu.org
• ETUC www.etuc.org
• ILO www.ilo.org
• ILO on the IE www.ilo.org.infeco
• Global Unions www.global-unions.org
• IFWEA www.ifwea.org
• IRENE www.irene.network.nl
• SEWA www.sewa.org
• WIEGO www.wiego.org

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How to plan activities?Activity for working
groups

• The first thing is we have to know what we want
  to achieve
• What? we have to be very precise, e.g. to
  increase TU membership by 10 .
• Who? who does what, etc.
• When? we have to settle concrete timetable
  depending on the size of an enterprise.
• How? the more employees you recruit, the bigger
  support you will have.
• For whom? - target group
• Resources.