Forms of shadow labour activities/ undeclared work

Grigor Gradev, ETUI

Patterns of activities referred to as “informality” by logic of operation and TU interest - provisional

Classical – survival strategy – ILO: “the dilemma of the informal sector”. Developing ”in” or “out” of informality

Breach of law – “survival”?/profit maximizing strategies – the dilemma of trade unions. Forced labour.

Voluntary/standard labour market practice – undeclared wage payments

What kind of economies and societies: informalisation / precariousness – deviation or element of future economy/ labour market ?

Classical

Traditional groups Street vendors, taxi drivers, small local

producers, domestic workers, hairdressers, etc. New groups

“dependant” self-employed highly qualified professionals

What solution – same activity out of the shadow, change of activity, stabilisation in the shadow ?

What role for trade unions? – orgasnise, for what How about development of business – strategy?

Breach of law Meaning in society with deficit of rule of law Main forms of work:

No contract Delay/ no payment of social security Less/ no wages – normal work, overtime,

other conditions Variations

Forced labour

Breach of law

Dimensions: Legal Institutional Procedural

Ideas tried Obligatory registration of contracts Guaranteeing return procedures Electronically linked systems Unified labour inspection powers – terms & conditions Sanctions for using undeclared work – target

employers

Voluntary/ standard labour practice

Undeclared work remuneration Why possible Where the money comes from Why people agree

Impact of flat/low tax Social fragmentation – low trust/low social

capital societies. Challenge to collective interests/collective action.

ideas

Frame and limit cash transactions Wages paid through banks Minimum social security tresholds Incentives for customers to press companies – VAT Financial / credit incentives for development and

efficiency of SMEs – only? Simplification of administrative procedures What is the purpose of SMEs – survive forever? Labour inspection capacities What role for the unions – collective bargaining,

organise?

Links to corruption

Pools of unaccounted money – at full discretion of the economic agents – bribes, state capture, etc.

Taxation services and integrity Public procurement – social clause

EU accession opportunity

The strategic moment for change The focus on taxation, evasion,

informalisation How WB trade unions see their future:

Attract FDI Fit the proposed fiscal/banking union and

EU economic governance perspective

Thank you for the attention