Informality and transitions to formality

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The number of workers engaged in informal employment has increased in many parts of the world. In many developing countries, workers in the informal economy represent the majority of the labour force. Workers in the informal economy are not covered by labour regulations and lack of access to social security coverage, which make them more exposed to shocks. However, experiences from many countries demonstrated practical ways to extend social protection to workers in the informal economy, and to facilitate their transitions to the formal economy.

 

Photo credit: “Does financing benefit African women?” by Africa Renewal (CCBY 2.0 via Flickr).

Legal Instruments

Transition from the Informal to the Formal Economy Recommendation, 2015 (No. 204)

This Recommendation recognizes the lack of protection of workers in the informal economy, and provides guidance for improving their protection and facilitating transitions to the formal economy. It also recognizes that decent work deficits – the denial of rights at work, the absence of sufficient opportunities for quality employment, inadequate social protection and the absence […]

Social Protection Floors Recommendation, 2012 (No. 202)

Recommendation No. 202 is the first international instrument to offer guidance to countries to close social security gaps and progressively achieve universal protection through the establishment and maintenance of comprehensive social security systems. To this aim, the Recommendation calls for (1) the implementation, as a priority, of social protection floors (SPF) as a fundamental element […]

Legal Cases

Access to courts and the right to work for informal traders in South Africa

Upon an urgent request, the Constitutional Court of South Africa intervened in a lower court affair to prevent the municipal government and Metropolitan Police Force from hindering what was asserted to be lawful activity by informal traders under the auspices of “Operation Clean Sweep”. Until the legality of the program that prevented trading in public […]

Resources

The Ghana National Health Insurance Scheme: Barriers to Access for Informal Workers

Ghana’s National Health Insurance Scheme (NHIS) is an innovative attempt to extend social protection to informal workers, and, as such, it may hold important policy lessons for other countries where the informal economy is large and growing and where informal workers are excluded from existing social protection mechanisms. Few studies have specifically focused on the […]

Work-related social protection for informal workers

The informal workforce is growing worldwide, and changes in the global structure of employment and in places of employment mean that work is a source of hazard and ill-health for many poorer workers. Yet informal workers do not have access to work-related social security. They face high work-related risks, but have little or no access […]

The informal economy and decent work: supporting transitions to formality: a resource guide

This practical Policy Resource Guide is the first initiative to bring together a synthesis of knowledge, policy innovations and good practices facilitating transition to formality. Chapter 8.1 deals specifically with the extension of social security to persons in the informal economy. Link to the resource guide Link to chapter 8.1

The transition from the informal to the formal economy, 103rd and 104th Session of the International Labour Conference

The informal economy is significantly impacting the world of work, with as much as 40–80 per cent of the labour force in developing countries working within it. Increasingly, transition to formality has emerged as a priority policy agenda in developed and developing countries, and new policy initiatives and approaches are taken in different regions that […]