Developments linked to globalization – including the increase in global production systems, expanding cross-border trade, intensifying competition and rapid market integration – have affected the supply and demand of labour, leading to calls for labour market reforms.

In essence labour market reform seeks to balance the employers’ demand for greater efficiency and flexibility with the workers’ need for employment stability, increased social protection and expanded social security. Its overall goal is to ensure that reforms are seen by all as efficient, equitable and fair. Depending on national circumstances, areas that may be considered as requiring reform include regulatory frameworks, labour administration systems, industrial relations norms and practices, and the operation of various bipartite and tripartite institutions including employers’ and workers’ organizations.

Better and stronger labour market governance goes hand in hand with fair working conditions as one of the essential requirements of decent work. Such working conditions include decent wages, hours of work, rest and leave periods, adequate social security, freedom of association, the right to bargain collectively, and an absence of discrimination, forced labour or child labour.