Home-based Work Worldwide

What is Home-based work?

Home-based work is a “general category of work within the informal or unorganized sector where workers carry out remunerative activities within their homes or in the surrounding areas but not at the premises of an employer”.

Home-based work or homework is one of the oldest professions and has a long history in South Asia. In the globalized world, home-based work has become a stable and profitable production mode for the firms. It is also beneficial for women as they don't have to go out and can combine their unpaid (care responsibilities) and paid work (home-based work) while remaining at home.

What is not home-based work?

Home-based work does not include the unpaid housework done as a family responsibility or paid domestic work performed at an employer's premises (like washing, cleaning, child care, etc.) for some payment. In the home-based work, the activity must lead to remuneration and it must not have been undertaken at an employer's premises, rather it should be at a worker’s home or in surrounding grounds/areas.

Is there any estimate of the total number of home-based workers in the world?

Home-based workers comprise a significant share of the workforce in old key industries such as garments, leather, carpet making as well as in new enterprises e.g., assembling microelectronics. They are found in the developed countries as well as in the developing countries like Pakistan, Bangladesh, and India etc.

With the technological revolution, home work or home-based work has exponentially increased and now it is not limited only to the production, rather it involves services as well, like a lawyer consultant working from home, a doctor consultant working from home for some other country, journalists, etc. It is estimated that there are around 100 million home-based workers; more than half of these are in South Asia while around 80% of these 50 million are women.

According to the ILO estimates, over 10 to 25 percent of non-farm/agriculture employment is in the home-based work in developing countries while this ratio is around 4 to 11 percent for developed economies.

What has led to the phenomenal increase in the home-based work?

There are three main factors behind this increase. First, Globalization has increased pressure on firms to cut costs through sub-contracting production and supporting flexible working contracts. Second, information technology has made it possible for workers, especially the professional and highly qualified workers, to work from home. Third, lack of formal employment opportunities mainly due to the lagging economic growth especially in the wake of financial crisis has led many workers to opt for self-employment. All these factors have led to an increase in the number of home-based workers.

What are the different types of home-based workers?

There are two main types of home-based workers. Piece rate workers are those who work for an employer and an intermediary while Own Account Workers are those who work on their own and do their own marketing.

Piece Rate Workers

These workers receive work from subcontractors or intermediaries and are paid a piece rate, according to the number of items produced. They do not have any direct contact with the markets for the goods they produce. They also have to arrange for raw material and other related tools and bear all infrastructure costs to produce goods. These workers are engaged both by the local (garments, textiles, agarbatti and bidi making) and international (garments, footwear, electronics and football) chains of production.

Own-Account Workers

These workers are generally in direct contact with the market and buy their own raw material. They face direct competition from large firms and don't have easy access to credit. Their economies of scales are lower and their cost of production is usually higher.

What is the difference between home-based and home workers?

Home-based worker is a much broad term and it includes all those working from home or in adjacent grounds/areas whether as piece rate or own account/self employed workers.

On the other hand, home worker is just a subset of home-based workers and these are actually the "piece-rate worker", also referred to as industrial outworkers who carry out paid work for business/intermediary from home on piece rate basis.

What does the ILO say about Home-based workers?

After long efforts by Self Employed Women Association (SEWA) and International Alliance by Home-based Workers (HomeNet), ILO adopted the Home Work Convention in 1996. The Home Work Convention (C177) defines homework as the "Work carried out by a person, to be referred to as a homeworker:

1. In his or her home or in other premises of his or her choice, other than the workplace of the employer;
2. For remuneration;
3. Which results in a product or service as specified by the employer, irrespective of who provides the equipment, materials or other inputs used"

The convention distinguishes between a dependent subcontractor (home worker) and an independent worker. These workers are differentiated on the basis of autonomy (in their work) and economic independence.

Is Home Work ILO Convention applicable to the own account workers?

No, the above convention deals only with the home workers /dependent subcontractors (piece rate workers) and excludes the genuinely self-employed home-based workers.

What rights are granted under this ILO Convention?

This Convention requires every ratifying member to prepare and implement a national policy for home-based workers, which should maintain equality between home workers and regular wage earners in the following areas:

• Freedom of association and collective bargaining;
• Protection against discrimination in employment and occupation;
• Equal remuneration for work of equal value;
• Statutory social security protection;
• Occupational safety and health;
• Access to training
• Minimum age and maternity protection

The convention also requires inclusion of home workers in national labor statistics i.e. labor force surveys. Moreover, it requires the ratifying nations to devise a labor inspection system for home-based work.

Why is Home-Based Work invisible?

Home-based workers are usually not included in labor statistics. Moreover, it is considered women's work with concentration of women in this work. These women home based workers always refer to themselves as "housewives" or "unemployed" (especially when asked about their economic activities during population census) even when they are working for long hours.

This work is also invisible because it lies between the formal and informal sector employment. Labor laws usually recognize only two categories of workers:

1. Employees (supervised workers) and
2. Self-employed (non-supervised workers)

Homeworkers i.e., dependent subcontractors challenge this dualism of labor law, as they are unsupervised wage employees tied through subcontracts to formal firms. Because of the dualism, these workers remain invisible and are not counted in labor statistics.

What are the different forms of home-based work?

Home-based work can be divided in two basic categories i.e., Traditional and Modern. Traditional home-based work involves labor intensive and manual activities while modern home-based work involves information and capital intensive clerical and professional activities. Traditional activities involve low level of skill as well as pay and are physically demanding while modern activities are not only complex but also involve high level of skill and are well paid.

Various forms of home-based activities include:

How do we differentiate between dependent subcontractors/home workers, own account workers/self employed and employees?

The following table adapted from ILO differentiates among these three types of workers.