Regulating for decent work: employment relationships, precarious work, labour law & ILO Recommendations. ACTRAV-Turin

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1 Regulating for decent work: employment relationships, precarious work, labour law & ILO Recommendations ACTRAV-Turin

2 Why focus on Employment Relationships? Traditionally, unionism & labour law has been based on Existence of employer-employee relationship Wage earner status of workers A fixed Work place factory/firm/establishment But the changing world of work & flexible labour markets are exposing the inadequacies of such assumptions

3 Purpose of labour law Redress imbalance of power between K & L grant certain rights to workers (workers empowerment) Regulate working conditions, set minimum standards for work & service conditions (workers protection) Regulate labour market (nationally or in certain sectors) to stipulate maximum or minimum limits (Ex: wages, strikes, right to organize, etc) Limit & control trade unions & its freedom of action What else?

4 Labour law protects who? Issues for consideration Who is an employee becomes a crucial issue for labour law & for workers protection What does denial of employment relationship do? - Unprotected worker, precarious employment - Fall in social security contributions & tax collections - Increase in legal disputes - Shifting of business risks & liabilities from employer/ enterprise to worker & society (in case of accident, for social security, employment) - In many countries takes workers out of the ambit of TUs & CBAs -???

5 Example: Changing employment relations in transport sector owner-driver schemes: drivers converted to owners of the trucks - drive it exclusively or almost exclusively for one company; instead of wage, paid per load (tonnage) delivered Company car driver converted into owner of the car with the company as the sole client paid on number of Kms driven Cabin crew given commercial contracts to provide in-flight services rather than employment contracts Mini- bus conductors hired casually employed by drivers who themselves are paid by passenger load Porters, cleaners on trains, stations, catering services, security guards - Airport services - loading, unloading & other ground staff

6 What is common to all these? Domestic work, construction, agricultural labour, repair maintenance jobs in building & services industry, etc Agency/Despatch workers, home based workers, piece rate work, contract labour, workers in EPZs or SEZs, Predominantly done by youth, women and migrants with little or no rights! largely precarious employees.

7 What is PRECARIOUS WORK? Employment relation that gives employers flexibility but leaves workers with unstable and insecure work, with limited rights & benefits, more control, lower costs and less responsibility Not only cheap labour but also flexible labour It pits workers against each other to undermine full time permanent employment. Mostly women and migrants overrepresented

8 First to be hit in times of crisis Workers in precarious employment Often ineligible for any type of severance payments or unemployment benefits. Special arrangements like short-time working, placement assistance, income support and retraining schemes apply only to the regular workforce - precarious workers are completely unprotected. In short no job security, no work conditions security, no skills or career security, no representation security In many countries migrants cannot form or join unions or be office bearers law & practice varies Need to change labour laws & regulations to provide protection to such employees

9 Gaps in labour law labour laws based on the assumption of employer-employee relationship BUT most of the new employment is contractual - where the employment is offered not as appointment but as assignment (as if in a client-supplier relationship) often takes the workers out of the ambit of labour law Many benefits under labour law depend on long term employment/regular status Labour law does not adequately address employment relationships in informal economy where employer-workers relationship is often disguised Need for labour/employment law to redress unequal bargaining position of workers engaged in work for remuneration outside the strict employment relationship

10 Inadequacies of labour law Workforce divided, protection under labour laws differs depending on which category a worker falls under, such as - Regular, Contract, Casual, Temporary, Muster roll, Adhoc employees, migrant, etc. Very few countries with a comprehensive employer-employee relationship law that sets the basic labour standards that apply to all the workers in the economy. Difficulties in establishing employment relationship causes problems not only for workers but also for the viability of national social protection systems. Establishing who is the principle employer important in today s world where outsourcing of production & services national as well as transnational - is happening on a large scale.

11 Main focus of labour law reforms today? Promote employment flexibility, increase management powers of bringing about changes at work place & create conditions for precarious employment & what about the workers? In return for flexibility, higher compensation, training & redeployment for workers BUT this should be done mainly by the State! While the costs of downsizing, insecurity of workers & investment in human capital (education & training) are sought to be passed on to the State, its role in regulating & legislating workers rights is being eroded

12 For policy makers the main issue is how do you balance the need for social protection of the workers with the need of the industry for production and employment flexibility? So, what should be the national policy on protection for workers in an employment relationship?

13 Determination of Employment Relationship ILO Recommendation Whether an employment relationship exists or not should be determined by facts not form Provide for legal presumption of existence of employment relationship where one or more relevant indicators are present Reduce or reverse the burden of proof from workers to employers In consultation with W & E organizations, provide that workers with certain characteristics in general or in a particular sector will be deemed to be either employed or self employed.

14 ILO Recommendation No. 198 on Employment Relationship, 2006 The recommendation calls upon the governments to Review & adapt the scope of laws to guarantee effective protection of workers in an employment relationship Set up mechanism (or use an existing one) to monitor the labour markets & the organization of work to implement measures concerning employment relationships. List criteria for determination of employment relationship, irrespective of how the relationship is described in any contractual arrangement

15 Determination of Employment Relationship National law/regulations could include indicators of the existence of employment relationship such as the level of control the employer has over worker s activities whether the worker provides his/her own equipment whether the workers hires his/her own helpers the degree of financial risk taken by the workers the degree of responsibility for investment & management by the worker workers opportunity for profit in the performance of his/her own tasks

16 Employee v/s Self employed Under the control of other Supplies labour only Receives a fixed wage Cannot sub-contract the work Does not supply materials for the job (equipment?) Not exposed to personal financial risk in carrying out work No responsibility for investment & management No opportunity to profit Fixed hours of work, OT, etc What else? Owns own business Exposed to financial risk Responsibility for investment & management Opportunity to profit from sound management of work Control over what is done, when where & who does it Free to hire other people Can provide services to more than one person/business Provides materials, equipment, etc for the job Costs & agrees price for the job Control over hours of work What else?

17 Other measures to be taken Settlement of disputes effective access Measures to ensure compliance: labour inspection services, collaboration with social security administration & tax authorities Remove incentives to disguise an employment relationship Promote the role of collective bargaining & social dialogue as a means to finding solutions to work place problems Monitoring & implementation mechanism & involvement of workers & employers organizations

18 Negotiating change at national level Ensure Right to Organize & Right to Collective Bargaining! Prevent further divisions of workers in the labour market put all workers in one boat. Set nationwide floor labour standards that apply to all workers & employers (de-link labour standards from permanency of employment); Roof to be attained thru Collective Bargaining the right to which should be ensured. Promotion of the ILO s Employment Relationship Recommendation - the employment relationship is the basis for labour law and its protection and vital for the respect of ILO standards.

19 Negotiating Change What is the floor that employers should respect? Freedom of Association the right to form unions, the right to recognition Right to Collective Bargaining Basic social security contribution Access to skills training No discrimination (not only gender but also citizen ship/migrants)

20 What can Trade Unions do? Organize!

21 Group Work 2 - Precarious employment Are there minimum standards/rights guaranteed to all workers in your country? Does the labour law in your country provide for right to organize & right to collective bargaining to workers? Does the labour law in your country address the needs of nonregular workers (despatch, agency, contract, casual, part time workers workers in precarious jobs)? Give examples. What difficulties do unions have in organizing contract, casual, agency workers? What are the reasons for trade union difficulties in organizing young people & women workers? What services or benefits does the union membership bring to a member in todays circumstances? Give example of successful organizing on precarious workers what helped to organize?