884. Lack of labour and social protections is one of the hallmarks of the informal economy. Issues such as wage regulation, working time, maternity protection and the work–family balance have traditionally been perceived as inapplicable to the informal economy.
885. During the preparatory work for Recommendation No. 204, a vast majority of governments and workers’ organizations and some employers’ organizations agreed that social security, safety and health, decent working hours and minimum wages should be progressively extended to workers in the informal economy. It is through formalization that access to these protections can be made effective. Indeed, accessing such protections constitutes an incentive for formalization that would be weakened if similar protections were provided to workers in the informal economy without a full transition to the formal economy.1106 This is implicitly acknowledged in Paragraph 18 of Recommendation No. 204, which provides that Members should progressively extend in law and practice, to all in the informal economy, social security, maternity protection, decent working conditions and a minimum wage that take into account the needs of workers and consider relevant factors, including but not limited to the cost of living and the general level of wages in the country. One of the elements of transition is the recognition that it is a process that takes time and that can take place progressively.
886. As seen in chapter III, Recommendation No. 204 thus seeks to promote a transition to formality over time. To achieve this, as provided for in Paragraph 11 of the Recommendation, several elements should be taken into account in the context of an integrated policy framework designed to guide the transition to the formal economy. These elements include income security and an appropriately designed minimum wage (Paragraph 11(r) of Recommendation No. 204).
(a) Socialprotectionfloors
887. When designing and maintaining national social protection floors, particular attention should be paid to the needs and circumstances of those in the informal economy and their families (Recommendation No. 204, Paragraph 19). 888. The Committee recalls that Recommendation No. 202 emphasizes that “social security extension strategies should apply to persons both in the formal and informal economy and support the growth of formal employment and the reduction of informality” (Paragraph 15). The dual strategy of promoting both the horizontal and vertical extension of coverage, as set out in Recommendation No. 202, is also reflected in Recommendation No. 204. Both Recommendations emphasize the importance of social protection floors in guaranteeing at least a basic level of coverage for those in the informal economy, and of extending access to contributory social insurance mechanisms. Social protection policies contribute to facilitating the transition of workers and economic units from the informal to the formal economy, including by promoting the creation, preservation and sustainability of enterprises and decent jobs in the formal economy and the coherence of macroeconomic, employment, social protection and other social policies (Recommendation No. 204, Paragraph 1(a) and (b)).1107 889. The incorporation of workers and economic units into the social security system constitutes another necessary step in the transition to formality. At the same time, it is important to take into account the specific circumstances of workers and economic units in the informal economy as well as their diversity. Moreover, it is important to differentiate between wage workers, whose employers should be required to contribute to social insurance schemes and own-account workers, who do not have an employer to fund contributory schemes. Recommendation No. 204 invites member States to progressively extend social insurance coverage to the informal economy and, if necessary, to adapt administrative procedures, benefits and contributions, taking into account their contributory capacity (Paragraph 20).
890. In its latest General Survey on social protection floors, the Committee emphasized that, in a context of prevailing high, and even growing levels of informality, and persistent inequality, poverty and vulnerability, it is of the utmost importance for national social security extension strategies to include effective protection measures for workers in the informal economy and to facilitate their transition to the formal economy. As recognized in Recommendations Nos 202 and 204, guaranteeing at least a basic level of income security and essential healthcare for all through a nationally defined social protection floor is essential to foster social justice and inclusive development, and to promote decent and productive employment. Social protection policies can also play a major role as an integral component of national strategies aimed at transitioning towards formal employment with a view to progressively achieving higher levels of labour and social protection for as many persons as possible.1108 The extension of social insurance to categories of workers with contributory capacity who were previously not covered, including through entirely or partially subsidizing contributions, is increasingly being used as a means of ensuring protection and fostering formalization.1109 Such measures also reduce unfair competition among enterprises. Social protection policies should be duly coordinated with other major public policies aimed at formalizing economies, including tax, education and employment policies. Such policies are key to building and maintaining comprehensive, inclusive and adequate systems.1110
891. The Committee recalls that the Maternity Protection Convention, 2000 (No. 183), applies to all employed women, including those in atypical forms of dependent work (Article 2). Furthermore, Recommendation No. 204 invites member States, if possible, to grant access to quality childcare and other care services to promote gender equality in the transition to formality (Paragraph 21). (b) Occupationalsafetyandhealth
892. While transition to formality takes place progressively, during the preparatory work for Recommendation No. 204, it was agreed that ensuring occupational safety and health for workers and economic units should be considered as an urgent measure that should be implemented without delay.1112 Paragraph 11(p) of the Recommendation provides that the integrated policy framework to guide the transition to formality should address effective occupational safety and health policies. Moreover, when addressing rights and social protection, Recommendation No. 204 invites Members to take immediate measures to address the unsafe and unhealthy working conditions that often characterize work in the informal economy and to promote and extend occupational safety and health protections to employers and workers in the informal economy (Paragraph 17(a) and (b)).
893. In this regard, the Committee recalls that Convention No. 184 and Recommendation No. 192 are cited in the Annex to Recommendation No. 204 as relevant instruments to facilitate the transition from the informal to the formal economy. Article 4(3)(h) of the Promotional Framework for Occupational Safety and Health Convention, 2006 (No. 187), provides that the national system for occupational safety and health shall include, among others, support mechanisms for a progressive improvement of occupational safety and health conditions in micro-enterprises, in small and medium-sized enterprises and in the informal economy. 894. In its General Survey of 2017 on occupational safety and health, in the context of the mining sector, the Committee identified the existence of a sometimes large informal subsector and the widespread use of subcontracting as further obstacles to the monitoring of working conditions in a sector where the incidence of fatal and serious accidents was high.1113
895. The Committee also referred to the particular situation of the agricultural sector, where informality is prevalent, as well as to the high number of precarious workers. The Committee highlighted the low coverage and participation of agricultural workers in national social protection systems.1114