R198 Employment Relationship Recommendation (ilo)

R198 Employment Relationship Recommendation, 2006 Considering the difficulties of establishing whether or not an employment relationship exists in situations where the respective rights and obligations of the parties concerned are not clear, where there has been an attempt to disguise the employment relationship, or where inadequacies or limitations exist in the legal framework, or in its interpretation or application, and Noting that situations exist where contractual arrangements can have the effect of depriving workers of the protection they are due, and Recognizing that there is a role for international guidance to Members in achieving this protection through national law and practice, and that such guidance should remain relevant over time, and Further recognizing that such protection should be accessible to all, particularly vulnerable workers, and should be based on law that is efficient, effective and comprehensive, with expeditious outcomes, and that encourages voluntary compliance, and Recognizing that national policy should be the result of consultation with the social partners and should provide guidance to the parties concerned in the workplace, and Considering that the globalized economy has increased the mobility of workers who are in need of protection, at least against circumvention of national protection by choice of law, and Noting that, in the framework of transnational provision of services, it is important to establish who is considered a worker in an employment relationship, what rights the worker has, and who the employer is, and Considering that the difficulties in establishing the existence of an employment relationship may create serious problems for those workers concerned, their communities, and society at large, and Considering that the uncertainty as to the existence of an employment relationship needs to be addressed to guarantee fair competition and effective protection of workers in an employment relationship in a manner appropriate to national law or practice, and II. DETERMINATION OF THE EXISTENCE OF AN EMPLOYMENT RELATIONSHIP 9. For the purposes of the national policy of protection for workers in an employment relationship, the determination of the existence of such a relationship should be guided primarily by the facts relating to the performance of work and the remuneration of the worker, notwithstanding how the relationship is characterized in any contrary arrangement, contractual or otherwise, that may have been agreed between the parties. 10. Members should promote clear methods for guiding workers and employers as to the determination of the existence of an employment relationship. 11. For the purpose of facilitating the determination of the existence of an employment relationship, Members should, within the framework of the national policy referred to in this Recommendation, consider the possibility of the following: (a) allowing a broad range of means for determining the existence of an employment relationship; (b) providing for a legal presumption that an employment relationship exists where one or more relevant indicators is present; and -- 1 of 2 -- (c) determining, following prior consultations with the most representative organizations of employers and workers, that workers with certain characteristics, in general or in a particular sector, must be deemed to be either employed or self-employed. 12. For the purposes of the national policy referred to in this Recommendation, Members may consider clearly defining the conditions applied for determining the existence of an employment relationship, for example, subordination or dependence. 13. Members should consider the possibility of defining in their laws and regulations, or by other means, specific indicators of the existence of an employment relationship. Those indicators might include: (a) the fact that the work: • is carried out according to the instructions and under the control of another party; • involves the integration of the worker in the organization of the enterprise; • is performed solely or mainly for the benefit of another person; • must be carried out personally by the worker; • is carried out within specific working hours or at a workplace specified or agreed by the party requesting the work; • is of a particular duration and has a certain continuity; • requires the worker's availability; • or involves the provision of tools, materials and machinery by the party requesting the work; (b) • periodic payment of remuneration to the worker; • the fact that such remuneration constitutes the worker's sole or principal source of income; • provision of payment in kind, such as food, lodging or transport; • recognition of entitlements such as weekly rest and annual holidays; • payment by the party requesting the work for travel undertaken by the worker in order to carry out the work; • or absence of financial risk for the worker 14. The settlement of disputes concerning the existence and terms of an employment relationship should be a matter for industrial or other tribunals or arbitration authorities to which workers and employers have effective access in accordance with national law and practice. 17. Members should develop, as part of the national policy referred to in this Recommendation, effective measures aimed at removing incentives to disguise an employment relationship. -- 2 of 2 --