UNDECLARED LABOUR AND SOCIAL ECONOMIES IN HUNGARY

Elemér SzentpéteryAssociation of Nonprofit Human Services of Hungary

ASSOCIATION OF NONPROFIT HUMAN SERVICES OF HUNGARY

ASSOCIATION OF NONPROFIT HUMAN SERVICES OF HUNGARY (ANHSH)

was registered on 26/10/1992. At present it is one of the largest Hungarian lobby umbrella organisations, which unites the civil and non-profit organisations that work in the field of human services and employment. The number of our member organizations is 120, but many of them functions as an umbrella organization as well, hence indirectly it provides almost 4500 organizations with its services all around the country. The quality management system of the Association was accepted with the certification of CERTOP Product and System Certification House on 19/05/2006. It was accredited as an adult education place (FAT) on 12/09/2007.

CURRENT PROJECTS

TÁMOP 2.5.1.Fourth Partner – Regional Partnership Programme

TÁMOP 5.5.3 IMPULSE TÁMOP 5.5.4. „HATYARIPE” „Help-net” supported by the

National Employment Foundation

UNDECLARED LABOUR

AFFECTED SECTORS Construction Agriculture Catering Trade Textile industry Households Highly qualified employees

AFFECTED SOCIAL GROUPSUndeclared labour is a problem affecting the

whole society. We can make a distinction amongst three main groups:

Enterprises explicitly specialized in illegal labour Persons having various activities, who doesn’t

declare some of their activities. Jobseekers lacking any income, and are forced

into illegal labour for various reasons, because legal labour markets can’t offer opportunities for them.

CHARACTERISTICS OF THE THIRD GROUP

Regarding seasonal work placements(construction,agriculture), emplyoment level of foreign workers is significant, meaning 150-200 000, mainly undeclared illegal employees

Abuse of the so-called „ad-hoc employee’s book” is increasing

anomalies with declaring part-time employment

REASONS Unused workforce

Low value on the labour market

Lack of education Lack of experience Children Unhealthiness Disadvantegous

residence Unrelibiality

Lack of motivation

Unsatisfied demands Uneconomic operation in

enterpise form Fewer consumers Low liquidity Shared demand

barriers of local governemnts

financial Human resources Conflict of interests

LABOUR LAW PROVISIONSHungarian labour law shall apply to the employee with

regard to the amount of the maximum working time and the

minimum resting time, the minimum level of paid annual leave, the minimum wage, conditions of occupational safety, recruitment and employment conditions for pregnant

women and those caring for infants, as well as for young employees and

the requirement of equal treatment.

CONTROL OF AUTHORITIES- OMMF The Hungarian Labour Inspectorate is a

central agency under the control of the minister of employment. - Its legal status, duties and competence are defined by the Government Decree No 295/2006 (XII.23). on the Hungarian Labour Inspectorate.

Directing labour safety issues Conciliation of interests

WAYS OUT

SOCIAL ECONOMY – COMMUNITY ENTERPRISES

A social enterprise is: An organization with primarily social aims,

which invests its profits for the good of the society or in order of community development

A democratically governed economic organization founded for activites not undertaken by the governmental sector, in the other hand lacking the profits normally generated by market actors

CRITERIONS OF COMMUNITY ENTERPRISES

Economic Continous

production, service providing

Highly independent Significant financial

risk Minimal payed work

Social Soldiarity Stakeholder-attitude Theory of one man,

one vote Limited profit sharing Serving the

community Voluntary work Good relations with

local governments Networking

SUCCESS-ELEMENTS Choosing the right consumer target group Adequate service providing for the target group Offering new, good quality and cheap product

Innovation Professionality Motivating and developing the labour force Volunteers

More than one pillars Cooperation with other social enterprises Cooperation with local governments Gradually widening markets

FINANCES Market Support from the labour markets Financial organizations with social and ecological

orientation Local funds, investment clubs, local venture-

capital enterprises Government subsidies Ethical banks Corporate networks

BEST PRACTICES

Regionális Civil Központ Alapítvány (recik)

Kékmadár Alapítvány Csereháti Településszövetség

UNDECLARED LABOUR’S CONNECTION TO SOCIAL ECONOMY Spreading of social enterprises relates to two problems:

increasing demands for social, human an community services, and the search for new ways to cost-effectively satisfy these demands in the middle of budgetary cut-backs and tax decreasing. Another important factor was the great increase in Western-Europe’s unemployment rates, and the formal economy’s inability to create workplaces in adequate numbers

Hungary faced the same problems after the change in regime. Drastical decrease in employment rates excluded disadvantaged, uneducated and unflexible individuals, most of them couldn’t return to the labour markets, including young people. The unused work force turned it’s attention toward the illegal economy….

THANK YOU FOR YOUR ATTENTION

1132 Budapest Alig u. 12Tel.:+36-1-270-0414Fax:+36-1-270-0433

E-mail: nonprofit@humszolg.huWeb: humszolg.hu