Lights On! Worker and social cooperatives tackling undeclared work

Undeclared work is a predominant form of informal work where work is explicitly hidden, even if there are laws in the country that might recognize it, while informal work also includes economic activities that are not formally recognized by law, even if they are not criminal activities. Today, the use of undeclared work can be explained by current trends such as the move towards more flexible working relationships, the growth of self-employment, sub-contracting, and the ease of setting-up groups of enterprises that operate across borders. Undeclared work affects governments, businesses, and workers across Europe too, and implies various negative impacts and consequences. Workers who receive all, or part, of their income in an undeclared form are particularly vulnerable in terms of recognition, working conditions, wages, skills development, social protection, representation rights and occupational health and safety (OSH). Enterprises who make use of such labour obtain unfair advantages over their law-abiding competitors. States in which a significant proportion of the labour force works in an undeclared form suffer from a reduction in tax revenues and social security contributions, which then has a negative effect on their welfare mechanisms. Tackling undeclared work is a major global challenge, as reflected in the adoption in June 2015 of the ILO Recommendation No. 204 concerning the transition from the informal economy to the formal economy, and the inclusion of a direct reference to formalisation in Target 8.3 of the UN Sustainable Development Goals. Finding a solution and supporting the transition from undeclared to declared work is a common purpose among local, national, and international institutions. In this context, cooperatives all over the world have proved themselves capable of enabling the formalisation process of transforming undeclared work into formal work, which is then integrated into the economy.