As the world grappled with COVID-19, the formal workforce across sectors embraced the concept of work from home (WFH). Informal workers in the formal sector, however, had a different tale to tell.
Joblessness, low income, mounting debt, lack of employment, no access to health/social security, and various other obligations are plaguing these shadow contributors to the global economy. Of the 2 billion informal workers worldwide, around 1.6 billion may lose their means of livelihood due to COVID-19 as per a CGAP report.
Who are the informal contributors to the formal sector?
Canteen staff, housekeeping employees, security staff, and many others in similar roles, were left to search for other means of earning a livelihood when offices downed their shutters in 2020, some for the long haul, to pave the way for WFH. In more ways than one, these informal workers are at high risk because they lack access to concrete health benefits and social security, and often fall prey to marginalization, discrimination, etc.
“When experiencing income losses, they (informal workers) may resort to negative coping strategies, such as distress sale of assets, predatory loans, or child labor. Migrant agricultural workers are particularly vulnerable, because they face risks in their transport, working, and living conditions, and struggle to access support measures put in place by governments,” says a joint statement (issued in October, 2020) released by the Food and Agriculture Organization (FAO), the International Fund for Agricultural Development (IFAD), the International Labor Office (ILO), and the World Health Organization (WHO).
Extending the corporate ‘social’ responsibility net
Governments across the world are trying to introduce social relief measures to mitigate the hardships of people affected by COVID-19, but the magnitude of the challenge is such that mere government intervention might be inadequate to alleviate the distress. This is where the corporate sector can play a role.
WFH has disproportionately affected women and the elderly. Many women have had to manage household chores and care for children while working, thus taking on additional responsibility. Another concern: since the outbreak of the pandemic emerging data and reports show that violence against women and girls, particularly domestic violence, has intensified. The elderly have also been affected because in low-income nations, elderly people continue working even after they retire to earn a living. The scope for such work has reduced drastically with the advent of work-from-home systems.
How can corporate employers support such informal workers?
- Businesses can offer specially designed insurance schemes, and social assistance programs (health, nutrition, and education services) to better cater to informal workers.
- They can also address the information gap – find and connect workers to government aid, and help them access prevalent schemes for cash transfers, funding, etc.
- If such staff are contract workers, on the rolls of an external human resource agency, businesses can check the agency’s hiring and payment practices to ensure that wages, and other benefits, trickle down to the workers and do not get held up in procedural bottlenecks.
- Employers and businesses can also ensure that the staff work in safe and non-hazardous conditions, and insist that even contract agencies follow established health and safety practices.
- In a bid to strengthen such practices, they can also engage in advocacy processes and collaborate with institutions to create more inclusive macroeconomic and legal policies.
COVID-19 has seen a convergence of crises in terms of health, food security, and employment. As we move towards the new normal, corporate houses and businesses can use this opportunity to widen the definition and application of corporate social responsibility to respond to the changing social landscape around them.
