Transition from Informal to Formal Employment Project Kyrgyzstan


The COVID-19 pandemic has greatly exacerbated the challenges that Kyrgyz workers have been facing as a result of rapid transformations in the labour market. Already high level of informality, aggravated by the COVID-19 pandemic, continues to grow. Kyrgyzstan, has one of the highest level of informality in Europe and Central Asia. Economic activity in the informal sector (71.8% in 2019) accounted for 23.5% of value-added in 2019 and 95.3% of new jobs. Tens of thousands of labour migrants have returned home, facing long-term unemployment, lack of access to any or sufficiently meaningful social protection, protection of rights and representation of their interests.

The second wave of COVID-19 surge in October 2020 has further aggravated the existing social-economic and labour market challenges: long-standing problems with fundamental worker rights, adequate minimum wages, working hours, health and social protection benefits, safety and health at work for all workers, especially those in informal employment. Insufficiently regulated self-employment and weak labour law enforcement allows for further informalization of jobs in the formal enterprises leaving workers without labour and social safeguards. Among the most affected are female workers in the textile and garment sector. Such approach causes further dry up of workers and employers contributions to health and social protection funds that are crucial for ensuring effective recovery and resilience of the Kyrgyz society towards ongoing and possible future crises.

The project will contribute to the implementation of the National Development Strategy of the Kyrgyz Republic till 2040, especially to its national priority related to the creation of sustainable environment for the development and priority sectors for sustainable entrepreneurship. The goal on Strengthening Human Potential and Labour Market implies implementation of active employment support measures in strict compliance with labour legislation, international standards and conventions aiming at formalizing informal employment and entrepreneurial activities. The shorter-term state Programme of the Development of the Kyrgyz Republic till 2022, identifies high level of informal sector among major obstacles for the economic development. The Government expects to achieve one of its outcomes on Sustainable Social Protection by expending the coverage of the pension insurance system to labour migrants and workers in the informal economy

Project overview

Overall objective: To raise awareness of informal workers about the benefits of formal employment including labour and social safeguards, empowering them to have their voices heard by exercising freedom of association and the right to organize as well as by mastering different forms of social dialogue to claim decent and safe working conditions in the formalized employment relations including by gaining access to health and social protection especially those relating to maternity protection and gender equality.

Key interventions:
  • Workers’ organizations implement an innovative strategy to successfully empower, integrate and represent workers in the informal economy as a result of the modernized internal institutional and organizational processes and internal regulations;
  • Workers’ organizations offer improved and innovative services (extension of social protection and unemployment insurance schemes)to informal and other workers in precarious situations to benefit from labour and social safeguards, organize and formalize;
  • Workers’ organizations produce proposals on extending social protection to workers in informal economy, taking due consideration of gender equality challenges, that are given recognition by the national inter-institutional mechanisms for policy-making and influence sustainable economic, social and environmental policies;
  • Sector-specific strategies promoting formalization available for selected sectors (textile and garment, construction, mining, food-processing);
  • Strong cooperation and effective networking established with civil society organizations on the matter of freedom of association and the protection of the rights and interests of informal workers.
Key activities by Outcomes:

Name of Outcome




Outcome 1 - Innovative strategies to attract new groups of workers and/or to improve their services


Mapping of workers’ organizations’ structures, governance and operations, as well as services they provide to members, carried out at least in 4 sectors (textile/garment, construction, mining, food-processing), to guide necessary changes for modernized internal institutional, organizational processes, adjusted internal regulations to successfully integrate and represent informal workers

Validation of findings and recommendations of the mapping, subsequently to be adopted by their respective decision-making bodies to amend/adjust constitutions/internal regulations

Model collective bargaining agreements, based on the best international experience, for the respective sectoral workers’ organizations is developed and piloted, focusing on prevention of informalization of formal jobs and formalization of employment relations

Capacity building of workers’ organizations to formulate and implement social protection policies inclusive of informal workers and promoting gender equality (C102, R202, C183, C156, KYR Country Profile on Informality from 2020)

Policy advice and technical support to workers’ organizations to develop new strategies to attract and provide innovative services to informal workers (including IT solutions/apps) in line with R204, also, ACTRAV report: Trade Unions in the Balance, ACTRAV manual on organizing informal workers, ACTRAV&INWORK: “A Compendium of Practice: Interaction between WOs and Workers in the IE”

Capacity building of workers’ organizations to formulate and articulate policies for formalization of informal workers through just transition towards environmentally sustainable economies and societies (R205, the ILO’s Climate Action for Jobs Initiative, the ILO Guidelines on Just Transition, 2015). Leaders and senior staff members trained on feasibility analysis and assessments providing evidence for fiscal space, etc.

Development of workers' position for the tripartite actions on the joint policy and legislative approaches to tackle the issues of informal economy and informal work, with special view to the COVID-19 crisis

Sector-specific strategies (textile and garment, construction, mining, food-processing) developed and submitted by workers’ organizations to relevant social dialogue mechanisms that promote sustainable recovery through formalization of informal economy while ensuring just transition to environmentally sustainable economies

Outcome 2- Workers’ organizations that produce proposals to be considered in social dialogue mechanisms for policymaking

Schemes for extension of maternity protection to (at least priority) groups of workers in non-standard forms of employment/informal economy developed, its piloting and scaling up facilitated and prepared for adoption through relevant social dialogue platforms

Capacity building of workers’ organizations to build networks and progressive alliances with and gain support of wider civil society representatives for their policies and joint activities aimed at advancing interests of informal workers and other vulnerable groups.

Schemes to test social insurance in case of unemployment of selected groups of workers in informal economy (to be defined through a tripartite discussion) with contributory capacity tested is developed and prepared for adoption through relevant social dialogue platforms

Capacity building of workers’ organization on ILS relating to formalization of informal economy including training (to cover 100 labour leaders/activists and over 1000 informal workers in at least 4 sectors), information and advocacy campaigns promoting access of informal workers