The ILO’s 113th International Labour Conference calls for a forward-looking discussion on innovative approaches to combat informality and promote formalisation to advance decent work. In this context, it is essential for the cooperative model to be recognised for its proven capacity to deliver human-centric, democratic, and community-tailored solutions that formalise employment and respect workers’ rights. They are active in diverse sectors — such as waste collection, domestic work, agriculture, and services — where informal work is prevalent, enabling broad-based formalization. Worker cooperatives play an important role in transitioning from the informal to the formal economy by offering a structured, legally protected, and socially inclusive framework for workers, by encouraging collective entrepreneurship and facilitating access to training and education.
This is further substantiated by the fact that ILO Recommendation 204, which for its purposes, acknowledges the role of cooperatives as economic units, also requires that policy frameworks address the promotion of cooperatives in the transition from the informal to the formal economy. Furthermore, the ILO Promotion of Cooperatives Recommendation 193 explicitly requires Governments to promote the important role of cooperatives in transforming informal economy into legally protected work, fully integrated into mainstream economic life.
Cooperatives are not a theoretical concept but a real-world solution prevalent in majority of the member states, and often impacting alike the stakeholders of workers and employers organisations. They have a long-standing track record of transforming precarious, informal work into secure and dignified employment and meet the international standards of Decent Work and Full Employment. Unlike profit-driven enterprises, cooperatives are built on a human-centred approach: they place workers and producers at the heart of the economic activity as owners and decision-makers. This model naturally promotes income security, decent working conditions and social protection.
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