Promoting Decent Work in Rwanda's Informal Economy

The Government of Rwanda perceives decent work deficits in the informal economy as of fundamental importance in line with the DWCP strategy, which stresses the promotion of employment for youth and women, enhanced social protection coverage, and promotion of social dialogue and rights at work. Labour rights are quite well acknowledged and catered for in Rwanda’s legislation. The challenge however is the lack of effective implementation of the provisions. About 90 per cent of the labour force in Rwanda work in the informal economy. The problem that this project will address is that the vast majority of workers, most of whom are in the informal economy, cannot exercise their rights, which means that decent work deficits persist in practice, despite a fairly supportive labour rights legislation. This project is relevant for Rwanda because decent work deficits or labour rights deficiencies such as low-earning and working poverty, poor working conditions, lack of protection in the event of non-payment of wages, compulsory and unpaid, lay-offs without notice or compensation, unsafe working conditions, low productivity, absence of social benefits such as pensions, maternity leave, accident/sick pay and health insurance, employment insecurity, poor occupational safety and health, lack of social security coverage etc. - are predominant in the informal economy. And yet approximately 90 per cent of Rwanda’s workforce is estimated to be operating in the informal economy while almost 90 per cent of micro and small enterprises are operating in the informal economy as well. Coupled with the move towards non-farm employment in Rwanda where informal occupations are a salient evolution in Rwanda’s jobs landscape, and where mostly the informal economy absorbs more workers due to low entry barriers, the informal economy was targeted. The project will be implemented through five outcomes with a market systems approach to decent work, with a specific sector-level approach for Outcome 1. At the macro level, Outcomes 2-5 will be driven by the priorities of Rwanda’s Decent Work Country Programme and the findings of the initial diagnostics. The expected results from this project include: i. More workers and businesses accessing or adopting strategies for improved working conditions; more income and earning ii. Improved capacity and motivation/ willingness of social partners to promote decent work more effectively iii. Increased number of informal workers with social security coverage iv. Increased number of informal workers subject to improved and effective legislation v. Increased number of informal workers subjected to quality OSH inspection The project’s sector component - Outcome 1 - will be implemented using the market systems approach, which seeks to stimulate market changes that can address the root causes to key decent work constraints . In using the approach, the project will work with partners that already operate in the market space in a way that addresses their incentives for improving decent working conditions. Whether that is making the business case for a private sector company to provide better occupational safety and health on site (less staff turnover, fewer lost days, and less costs to pay for injuries), or providing market information to the TVET training institutes so that they understand where core training demand is to better suit private sector needs (more revenues coming into the institute) so that workers have the right skills for the right jobs - the idea is that decent work can be achieved through market incentives. And because there is such a strong focus on addressing market incentives, the approach is well positioned to deliver long-term sustainability and scalability of the interventions. As the project component will have an iterative and flexible approach, it will further emphasize the systemic approach. Outcome 1 will thus include a diagnostic study that will take place during the initial six months period

Project symbol

RWA/17/04/SWE

Admin unit

CO-Dar es Salaam

Start date

01/11/2017

End date

30/12/2020

Total allocation

2448100

Total expenditure

Status

Closed

1574398

Development Partners

Sweden, Swedish International Development Cooperation Agency

Country/Countries

Rwanda

Outcomes

Outcome 4: Sustainable enterprises as generators of employment and promoters of innovation and decent work