Direct Request (CEACR) - adopted 2019, published 109th ILC session (2021)

Employment Policy Convention, 1964 (No. 122) - Paraguay (Ratification: 1969)

Other comments on C122

Observation

Direct Request

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Articles 1 to 3 of the Convention. Implementation of an active employment policy. Participation of the social partners. The Committee notes that, according to information available on the Government’s website, in November 2018 the National Employment Plan was in the process of being prepared with ILO support. The objectives of the Plan include the creation of decent jobs and the improvement of the functioning of the labour market, so that they are aligned with the objectives of the National Development Plan (PND) and in compliance with the Sustainable Development Goals (SDGs). The principal elements of the programme include programmes to promote employment and entrepreneurship skills, the strengthening of employment services and their articulation with skills training. The Government indicates that the Plan will give special consideration to the situation of young people, due to the high rate of youth unemployment in the country. With regard to labour market trends, the Government indicates that, according to the Continuous Employment Survey of the Directorate General of Statistics, Surveys and Census (DGEEC), the activity rate in the third quarter of 2017 was around 65.7 per cent, which was lower than the figure for the same quarter in 2016. Over the same period, the activity rate fell from 93.1 per cent to 92.4 per cent, while the unemployment rate rose from 6.9 per cent to 7.6 per cent. The Committee also notes that the number of employed persons earning less than the minimum wage rose from 25.8 per cent to 27.6 per cent. Moreover, in 2017, approximately 4.1 per cent of the economically active population was underemployed. The Committee requests the Government to provide detailed and updated information on the formulation, adoption and implementation of the National Employment Plan and to indicate the manner in which the experience and views of the social partners were taken into account in this regard. The Committee also requests the Government to continue providing updated statistical data, disaggregated by age and sex, on the situation, level and trends of employment, underemployment and unemployment in both urban and rural areas of the country.

Contribution of the employment service to employment promotion. The Government indicates that the General Directorate of Employment has undertaken a series of measures with a view to improving labour intermediation, guidance and placement services for jobseekers who are unemployed or inactive. The objectives of the General Directorate of Employment include: promoting the access of the unemployed and underemployed to full employment, and the formalization of those engaged in informal productive work; promoting action to increase and improve employment, with emphasis on vulnerable groups; and developing relations with employment placement enterprises and organizations. The Government indicates that a total of 42,255 people were assisted by the public employment services between 2016 and May 2018. The Committee also notes the Government’s information concerning the implementation of the employment portal, entitled “Paraguay Can Do More” (Paraguay Puede Más), where those interested can register to have access to job vacancies. Moreover, in 2017, a total of 40 employment fairs were held focusing on the most vulnerable population groups, including persons with disabilities, single mothers and workers in the rural sector and maquila enterprises. Finally, the Government reiterates that the National Employment Office has concluded various cooperation agreements with local governments and that an increase in the number of local employment offices was planned for 2015 to reach a total of 29 offices throughout the national territory. The Committee requests the Government to provide detailed and updated information on the impact of the measures adopted to improve the quality of employment placement and guidance services and to increase the coverage of the network of employment offices throughout the country.

Youth employment. The Committee notes the information provided by the Government in its report on the measures adopted to promote youth employment. In particular, the Government refers, among other actions, to the holding of youth employment fairs, the development of skills training in educational institutions and the preparation of the document “Youth Employment Strategies 2016” with a view to promoting the integration of young people into employment and improving their situation on the labour market. The Government also reports on the implementation of the Employment Integration Support Programme (PAIL), co-financed by the Inter-American Development Bank (IADB), with the objective of improving the conditions of the employability of young people in Asunción and the Central Department through innovative training and skills development methods, financial support for skills development for vulnerable young people and the social commitment of enterprises, taking into account the gender perspective. Furthermore, in 2015, an Inter-institutional Round Table on Rural Youth Entrepreneurship was established with a view to developing the skills and generating sources of employment for youth in rural areas. The Government indicates that the Youth Employment Integration Act is undergoing a process of amendment due to the problems raised by its application in practice. However, the Committee notes that the Government has not provided information on the impact on the beneficiaries of the various programmes in terms of the lasting integration of young people into the labour market. The Committee reiterates its request to the Government to provide detailed information, disaggregated by sex and age, on the impact on the beneficiaries of government projects in terms of the lasting labour market integration of young people, including young people in rural areas. The Committee also requests the Government to provide a copy of the Youth Employment Integration Act once it has been amended and to indicate the extent to which the new contractual arrangements envisaged in the Act have contributed to the creation of productive employment for beneficiaries.

Promotion of small and medium-sized enterprises and employment promotion. In its previous comments, the Committee once again requested the Government to provide detailed information on the impact on productive and lasting employment creation of Act No. 4457 of 16 May 2012, establishing the regulatory framework to promote and encourage the creation, development and competitiveness of micro, small and medium-sized enterprises (MSMEs), and for their integration into the formal productive system for goods and services. It also requested the Government to indicate the manner in which the legislation in force ensures adequate labour protection for workers in MSMEs and enables the gradual integration of workers in the informal economy into the formal employment market. The Committee notes, based on the ILO technical report of 2017 “Paraguay: Current situation of MSMEs and formalization policies”, that MSMEs account for the majority of economic units in the country and most employment. The technical report emphasizes in particular that the economy in Paraguay is dominated by very small, low productivity, labour-intensive production units in which a high proportion of employment is concentrated. This structural situation gives rise to important gaps in decent work and working conditions in relation to large enterprises in terms of the quality of employment, income, productivity, education, social security coverage, unionization rate and informality. The report emphasizes that the informal employment that is a characteristic of the Paraguayan labour market is concentrated in MSMEs and own-account occupations (the data shows that in 2015 in microenterprises with between two and five employed persons, 84 per cent of employment was informal, and that the figure was 72 per cent in microenterprises with between six and ten employed persons, while the level of informality at the national level was around 71 per cent). The Committee also notes the information provided by the Government on the measures adopted with a view to promoting the formalization of MSMEs. The Government refers to the conclusion of formalization agreements with various institutions, such as Ciudad Mujer and the University of the Pacific, with a view to establishing a formalization unit for entrepreneurs and owners of MSMEs and providing training, business plans and technical assistance to entrepreneurs. Within the framework of measures for the formalization of MSMEs, over 500 enterprises were provided with assistance and over 20,000 persons were informed of the benefits of formalization. Between December 2014 and June 2018, the number of MSME units in the National MSME Register increased from 17 to 2,590. The Government indicates that the benefits available to formalized MSMEs include access to soft loans, training and technical assistance. However, the Committee notes that the Government includes among the benefits to which it refers the so-called simplified labour regime for MSMEs, which allows fixed-term employment contracts for three years without the requirement to give notice and authorizes the payment of wages below the statutory minimum level with the prior authorization of the MTESS, which are practices that are not in conformity with ILO instruments. Finally, the Government reports the implementation in 2016 and 2017 of the Micro-Entrepreneur Strengthening and Development Project, which provides non-reimbursable financing and entrepreneurship education to micro-entrepreneurs with a view to guaranteeing the sustainability of their enterprises, as well as granting micro-credits called “Ñepyryra” to trainees of the National Vocational Promotion Service (SNPP) for the development of microenterprises. The Committee requests the Government to continue providing detailed information on the impact of Act No. 4457 on the creation of productive and lasting employment. It also requests the Government to continue providing detailed information on the manner in which the legislation in force ensures adequate labour protection for workers in MSMEs and promotes the progressive integration of workers in the informal economy into the formal employment market.

Coordination of training policy with employment opportunities. The Committee notes the information provided by the Government on the various training and labour skills courses provided between 2016 and 2018 by the National Training and Labour Skills System (SINAFOCAL), in collaboration with workers’ organizations, and the number of participants. The Government also refers to the implementation of various programmes, such as the dual training model (MoPaDual) through which the beneficiaries received, in combination with theoretical training, practical training in a private enterprise or public institution. Between January 2014 and May 2018, a total of 729,464 certificates were delivered in the context of the training courses provided by the SNPP for men and women at different levels and in the various sectors of the economy. With reference to the measures adopted to improve the provision of training and skills development, the Government reports the preparation of studies and investigations to identify qualitative and quantitative vocational training needs. In this context, the Prioritization Index for Vocational Training Courses (IPCL) was developed to establish indicators to be taken into consideration for the prioritization of the labour skills demanded. Moreover, in 2017, a Register of Vocational Training and Skills Development Institutions (REIFOCAl) was developed, through which certificates are issued regularly for training and skills development institutions with a view to formalizing enterprises which provide training and skills development services. The Committee also notes the adoption of Act No. 5749 of 24 January 2017 issuing the organizational chart of the Ministry of Education and Sciences (MEC), creating the National Education and Labour Council (CNET) as a bi-ministerial operational body (the MEC and the Ministry of Labour, Employment and Social Security – MTESS), composed of representatives of employers’ and workers’ organizations. The Government indicates that the responsibilities of the CNET include: approval of a Strategic Education and Labour Plan; guaranteeing coordination with the various sectors involved in the implementation of public policies in the fields of education and labour; and cooperating in the implementation of the National Catalogue of Occupational Classifications. However, the Government indicates that the CNET is not yet operational, as its members are still to be appointed. Finally, the Committee notes that, in its concluding observations of 22 November 2017, the Committee on the Elimination of Discrimination against Women (CEDAW) welcomed “the introduction of non-formal literacy programmes for indigenous communities and non-formal vocational programmes allowing young people and adults to develop practical skills for specific occupations”. However, the CEDAW expressed concern at the “persistence of structural barriers to access to high-quality education for girls, in particular at the secondary and tertiary levels, owing to, among other things, inadequate budget allocations to the sector … especially in rural areas” and the “[p]ersistent disparities in literacy rates for women and men and the significant level of illiteracy among indigenous women and rural women” (CEDAW/C/PRY/CO/7, paragraph 32(a) and (b)). The Committee requests the Government to provide updated statistical data, disaggregated by age and sex, on the number of persons, including women and indigenous girls in rural areas, who participate in education and training programmes and the impact of these programmes on their access to decent, productive and lasting employment. The Committee also requests the Government to continue providing detailed and updated information on the coordination of education and vocational training policies with employment policies and, particularly, on how the provision of training is coordinated with the demand for knowledge and skills, and on current and anticipated labour market requirements.