Extending social security to workers in the informal economy: Lessons from international experience

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Summary (English)

For most workers in the informal economy, the lack of social protection is a challenge not only in their daily struggles to make ends meet but in their aspirations to obtain decent work, rights and dignity. For the societies in which they live, the lack of social protection coverage undermines inclusive growth, weakens social justice and undermines the realization of human rights.

The main objective of this guidebook is to provide policymakers, workers’ and employers’ organizations and other stakeholders with a practical tool to help them in developing viable policy options to address the many challenges of extending social protection to workers in the informal economy and facilitating transitions to formality. It aims to address and remove the barriers that prevent workers in some forms of employment from being protected and also to encourage transitions from the informal to the formal economy. This guidebook will be particularly relevant for national dialogues on social protection policies and strategies.

This guidebook provides evidence of good practices, challenges and constraints and addresses a broad range of relevant topics, including analysis of needs, adapting social security legislation, compliance and enforcement mechanisms, administrative procedures, benefit design, contribution schedules, service delivery and monitoring mechanisms. Recognizing the heterogeneity of workers’ realities, the guidebook reflects specific challenges and good practices for selected sectors and categories of workers (domestic workers, agricultural workers, self-employed workers, workers in micro and small enterprises (MSEs), etc.) and also provides links to more specific guidance material focusing on these groups. Some of the policy measures developed by countries to enhance the coverage of workers in the informal economy and workers in non-standard forms of employment can serve as valuable pointers on how to extend coverage to workers in new forms of employment. The guidebook emphasizes the need to combine contributory mechanisms (social insurance and other forms) with solid non-contributory (tax-financed) mechanisms in order to achieve universal social protection coverage.

This guidebook complements other materials and tools developed by the ILO and others, both on social protection and on facilitating the transition from the informal to the formal economy.

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Report 50935 health care , income security , pensions , social assistance , social health protection , social insurance , social protection floor , social services , social transfers , universal benefits , informal economy workers , rural workers , self-employed , women , administration , capacity building , employment policy , financing , gender , governance , ILO standards , national strategies , social protection policy , disability , maternity , old-age , sickness , survivors , unemployment , benefits , cash / in-kind benefits