Often used in the context of under-declared employment, an envelope wage is a cash-in-hand wage paid by a formal employer to a formal employee in addition to their official declared salary, to reduce their tax and social security payments and therefore labour costs. It arises from an agreement between the employer and employee, and additional conditions may be attached to its payment, which are not in the formal written contract or terms of employment.

When designing and implementing a full policy operationalisation model, the results of relevant ex-ante (impact assessments) and ex-post evaluation should be used as sources of information when preparing decisions and determining the effectiveness and efficiency of policy measures for tackling undeclared work. Pilot studies are also an accepted tool for evaluating the effectiveness of a policy approach and measures.

All work or service which is exacted from any person whether or not under the menace of any penalty and for which the said person has not offered themselves voluntarily, according to the ILO’s Forced Labour Convention 29 1930: Ar.2 (1). This definition consists of three elements: work or service refers to all types of work occurring in any activity, industry or sector including in the informal economy; menace of any penalty refers to a wide range of penalties used to compel someone to work; and the term “offered voluntarily” refers to the free and informed consent of

Is a fundamental right of workers in the EU allowing to look for a job in another EU country, to work there without needing a work permit, reside there for that purpose, stay there even after employment has finished and enjoy equal treatment with nationals in access to employment, working conditions and all other social and tax advantages.  It entails the abolition of any discrimination based on nationality between workers of the Member States.

This is a model for implementing the holistic approach that combines the range of policy approaches and measures available. This model asserts that the most effective approach is to concurrently implement direct measures (e.g. workplace inspections) to enhance the power of authorities as well as indirect measures (e.g. awareness raising) to enhance trust in authorities.  It is based on evidence that a high trust high power approach is the most effective in tackling undeclared work.   

Where national governments use a whole government approach to tackle undeclared work, by joining-up on the policy and enforcement level of both strategy and operations the fields of labour, tax and social security law, and involve and cooperate with social partners and other stakeholders.

These measures make it easier to undertake, and reward, participation in declared work. Measures used include: purchaser incentives (such as service vouchers, targeted direct taxes, targeted indirect taxes), and supplier incentives (such as society-wide amnesties, voluntary disclosure and business advisory and support services).

[Eurofound (2013), op cit.]

These aim to align citizens and businesses attitudes and behaviour with the laws and regulations. This can be achieved either by changing their attitudes and behaviour, or by establishing trust in the formal institutions.

A term used by the ILO mostly in relation to the developing world, which covers all economic activities by workers and economic units that are – in law or in practice – not covered or insufficiently covered by formal arrangements.This definition is very similar in its scope to the definition of undeclared work as understood in the context of the Platform, but reflecting the developing world contexts where it is used, tends to also include workers who sometimes fall outside the coverage of labour legislation (e.g. unpaid, domestic or agricultural workers).

Employees are considered to have informal jobs if their employment relationship is, in law or in practice, not subject to national labour legislation, income taxation, social protection or entitlement to certain employment benefits (advanced notice of dismissal, severance pay, paid annual or sick leave, etc.).

Employers and own-account workers are considered informal when their economic units belong to the informal sector. The informal sector is a subset of household unincorporated enterprises (not constituted as separate legal entities independently of their owners)  that produce for sale in the market, even if partly, and that do not have a complete set of accounts and/or are not registered under national legislation.

[ILO, Resolution concerning the measurement of employment in the informal sector, Fifteenth International Conference of Labour Statisticians (ICLS), Geneva, 1993.]

An IT-based information electronic platform that links up national, regional and local authorities across borders to facilitate administrative cooperation. It can be used to ask questions about regulations and posting of workers and companies, help to collect fines cross border, and facilitates the sending of information and alerts about irregularities to another country.

Inspections of a workplace often led by a labour inspector with respect to the upholding of current labour regulations but carried out in conjunction with one or more public authorities, for example, tax authorities, social security institutes, the police, and/or migration authorities. This enables a more joined-up approach to tackling undeclared work.

Inspections undertaken by the competent authority of one Member State on its territory, with participation of the competent authorities of one or more other Member State(s) concerned. Concerted inspections in the cross-border context are inspections undertaken by the competent authorities of two or more Member States simultaneously and related to the same case, with authorities in Member States operating in its own territory and with its own staff.

A measurable value that demonstrates how effectively an organisation is achieving its strategic objectives in relation to tackling undeclared work.

The functions of the system of labour inspection shall be: (a) to secure the enforcement of the legal provisions relating to conditions of work and the protection of workers while engaged in their work, such as provisions relating to hours, wages, safety, health and welfare, the employment of children and young persons, and other connected matters, in so far as such provisions are enforceable by labour inspectors; (b) to supply technical information and advice to employers and workers concerning the most effective means of complying with the legal provisions; and (c) to bring to the notice

Companies which have complied only with the bare essentials (e.g., book-keeping, administration) for organisation and registration in a particular country. The actual commercial activities are often carried out in another country. This is sometimes used to enable businesses to deviate from applicable legislation, resulting in violations of labour law or collective agreements, tax and/or social security compliance, leading to undeclared or under-declared work.

Less formal instrument than bilateral agreements, often setting out operational arrangements under a framework agreement on an international level. MoUs entail general principles of cooperation describing broad concepts of mutual understanding, goals and plans shared by the parties. They are usually non-binding. MoUs can cover agreements between enforcement bodies of different MS/EEA countries.

Cooperation between three or more countries.

An instrument for cooperation between two or more national institutions, eventually also involving cooperation with relevant stakeholders such as social partners to undertake activities defined either in law or policy to tackle undeclared work. National agreements can have many different forms such as legal prescriptions, memorandum of understanding, strategic documents and action plans, and executive orders.