In a recent review of issues that impact upon the design of labour market regulation in poor countries, Marshall and Deakin (2010) emphasized that “proposals for law reform and institutional redesign should be compatible with local regulatory styles, as well as being politically viable” (p. 20). Marshall and Deakin’s (2010) framework for development-friendly labour law reform can be adapted for UFW.
Marshall and Deakin developed a comprehensive list of factors to con- sider as a starting point for labour law and policy, which is provided below in table 3.2. The general factors, which comprise the top half of the list, reflect the significance of considering path dependency, the institutional mix, and roles and resources of labour market actors in designing effective labour regu- lation. They also draw attention to the need to consider the interaction of contiguous and overlapping policy domains such as labour, social, and tax in order to develop an integrated, systemic, and coherent policy approach (see also Jütting and de Laiglesia, 2009, p. 150).
The second half of Marshall and Deakin’s (2010) list refers to the specific criteria for labour law reform, which correspond to the functions of labour market regulation. These criteria overlap to a significant extent with the sub- stantive dimensions of UFW identified in Chapter 2. economic coordination, risk distribution, and empowerment are ways of categorizing some of the dimensions that make work unacceptable, such as the separation of control/ profit from responsibility/risk in value chains, the shifting of risks to vulner- able workers, and the exclusion of workers from institutional support for voice and economic security.
Table 3.2 Checklist for developing and reforming development-friendly labour market regulation
Generic criteria
Incentive compatibility
Ì Is the law compatible with the economic incentives of private parties?
Ì Does the law invite destabilization through, for example, incentives for avoidance or evasion of rules, free-riding, or destructive competition?
Systemic fit
Ì How far does the law work in conjunction with other regulatory mechanisms pres- ent in the country in question, including, for example:
• collective bargaining
• diversity and discrimination laws • occupational regulation
• activities of employers’ associations
• the corporate governance and financial framework • competition law
• tax law
Context dependence
Ì Is the law compatible with the level of industrialization?
Ì Does it match the extent of wage dependency, and the mix of informal and formal workers?
Ì Does the law take into account the range of different working arrangements in the State, including dependent, semi-dependent, triangular and own account, as well as periods of unpaid work?
Inclusivity of governance
Ì Does the law encourage participative decision-making, and broader social and civil dialogue, in the formulation of rules?
Ì Will the design of the law further its take-up, effectiveness and impact?
Institutional capacity
Ì Does the State have the capacity to monitor and enforce the law?
Ì Do businesses have the capacity to observe the obligations imposed by this law? Ì Do business and employer representative organizations have the capacity to inform
members about the law and assist with its enforcement?
Ì Do labour organizations have the capacity to inform members about the law and assist with its enforcement?
Ì Is there a place for the involvement of other bodies with an interest in poverty alleviation?
Ì Are there processes in place which will contribute to building the institutional capacity of each of these players?
Ì How can the capacity of these parties be improved through the design of institutions? Ì Is there a mechanism for continual review of the effectiveness of rules, which con- tributes to institutional learning and allows parties to share information about what works and what doesn’t?
Ì What links are there with international bodies, so that norms set at the inter- national level can be implemented at the local level, and complaints can be made to international or regional bodies?
Specific criteria
Economic coordination
Ì Does the law provide for appropriate allocation of decision-making powers within and between organizations?
Ì Does the law provide mechanisms for the internalization of external costs arising from the decisions and activities of individual organizations?
Ì Does the law provide a basis upon which coordination problems can be overcome in the provision of collective or public goods concerning matters such as training, occupational licensing and dispute resolution?
Ì Does the law encourage technological upgrading and improvements in job quality? Are there any additional incentives for compliance and “going beyond the law”?
Risk distribution
Ì Does the law recognize the unequal bargaining power of parties to work relationships? Ì Does the law redistribute risk away from vulnerable parties, or does it compound
their vulnerability?
Ì Does the law distribute risk in such a way that will create incentives to formality or, to the contrary, to avoid the law because risks are better dealt with by informal means?
Demand management
Ì Does the law contribute to a level of income which will allow workers to meet basic household needs and to participate meaningfully in society?
Ì Is the income level of the workers set by the law at a level which will stimulate local demand for goods and services?
Democratization
Ì Does the law provide for the involvement of all workers and employers, either directly in workplace governance or through their representatives, in the formu- lation of rules governing work relationships?
Empowerment
Ì How far does the law promote access to and participation in stable and well-remu- nerated work relationships?
Ì How far does the law provide for economic security in the event of limits on the availability of stable and well-remunerated work?
Source: Marshall and Deakin (2010).
These criteria can be adapted for developing regulation that targets the most unacceptable forms of work. Regulation that addresses vulnerability, coercion, and deception is especially helpful in the context of combating the most unacceptable forms of work. So, too, is regulation that addresses breaches of fundamental rights such as hazardous forms of child labour and forced labour. The evaluation tool for identifying UFW both complements and supplements the more general framework for labour law reform; what it does is provide a specific focus on UFW, while at the same time ensuring that action targeting UFW is compatible with development.