A. THE CONTEXT

The Mandate

Nature of Employers' Organizations

The Needs to be Addressed

B. OBJECTIVES

C. STRATEGIES

D. METHODS AND MEANS

E. A PROGRAMME APPROACH

F. PRIORITY AREAS

Policy Formulation at the National Level

Institution Capacity Building

A Strategic Vision
Staff Development
Information, Knowledge, Research and Training Material

Promoting Enterprise Competitiveness

Industrial Relations and Human Resources Management
Productivity
Small Enterprise Development
Safety and Health
Environment

Developing Human Capital

Human Resources Development

Child Labour

The Mandate

Strong, independent and representative employers' (and also workers') organizations are essential for effective national policy formulation on social policy issues, as well as for their implementation. The strengthening of employers' organizations is a key element in the ILO's objective of strengthening tripartism. The activities with employers' organizations, in addition to creating a capacity in them to participate in tripartite dialogue, contribute to enterprise competitiveness in the other areas of the ILO's programmes (see below under Priority Areas). Social stability predicates that whenever possible development policies are best negotiated, and representatives of employers (and workers) are essential parties to the negotiation process.

Nature of Employers' Organizations

Employers' organizations have two major functions. The first is to influence the policy and legal environment so as to ensure that it is conducive to business growth and development through, for instance, tripartite as well as bipartite dialogue with government and unions. The second is the provision of direct services to members which are based on the latters' needs; which enhance the performance and competitiveness of the private sector; and which enable members to discharge their wider corporate responsibilities and make contributions to national socio-economic development. An effective employers' organization, by improving the climate for enterprise development, contributes to employment growth and poverty alleviation. In essence, an employers' organization is both a lobbying and service organization.

The Needs to be Addressed

However, some countries which have had no employers' organizations (countries in transition) now have nascent organizations, or in some cases none at all. In several other developing countries the organizations are relatively weak. They are, to varying degrees, constrained by circumstances such as

• inadequate professionally skilled staff
• a narrow membership base affecting their representativeness
• a weak financial base
• inadequate involvement of them by governments in tripartite dialogue,
particularly (but not only) in economies in transition.

These weaknesses have been exacerbated in recent years by the impact of globalization which has heightened the need for employers' organizations to review their mission and services, and to develop a strategic vision as well as plans with a clearer focus, objectives and means of achieving such objectives. The changing context is resulting in increasing pressures on employers' organizations for:

• more effective policy lobbying to influence the policy and legal environment so that it is conducive to enterprise growth in less "business friendly" countries such as economies in transition.
• value added services which enhance enterprise competitiveness.
• the integration of economic and social analysis of data and trends.
• the development of economic related services and skills, given that it is no longer possible to strictly separate issues which have only economic consequences from those which have only social consequences
• more business support services and programmes which positively impact on enterprise expansion and efficiency.
• well analysed information on national, regional and international trends and data.

In this situation a major challenge for employers' organizations is the necessity to transform and adapt themselves to meet the rapidly changing needs of their members, to anticipate such needs and prepare to address them. Just as much as other organizations and institutions are being subject to performance measures, employers' organizations are also being subject to similar scrutiny by their members.

The current and future needs of developing employers' organizations are related to sustainable capacity building to strengthen them in the following respects:

1. Staff development which involves the acquisition of knowledge and training.
2. Developing marketable services which will in turn help to increase the membership base and generate income.
3. Strengthening their capacity to participate in tripartite and bipartite dialogue, and thereby to influence the policy environment.

However, there are no institutions and programmes outside the ILO which cater to the needs of employers' organizations, unlike in the case of enterprise managers who have access to numerous training facilities both nationally and internationally. As such, developing employers' organizations are largely dependent on the ILO for sustainable capacity building.

The objectives of the ILO's programmes for employers' organizations are to:

1. support strong, free and independent organizations;
2. strengthen the capacity of such organizations to address the issues and challenges facing their countries' economic and social development efforts, and to contribute to national development goals consistent with basic ILO standards;
3. enhance the capacity of employers' organizations to influence the socio-economic policy environment to be conducive to enterprise growth and development, encourage the proliferation of competitive enterprises, and develop services relevant to their members' needs. Employers (and others) are now aware that competitiveness is built around competitive enterprises, and they expect their organizations to develop services which would assist them in achieving competitiveness.
4. develop the capacity to assume a more effective role in the tripartite/bipartite framework.
5. reflect the ILO's priority concerns such as poverty alleviation and employment generation; ensuring a safe, healthy and improved working environment and conditions; practice of tripartism; and the creation of a national and enterprise-level framework conducive to sound employment relations.
6. associate employers' organizations with the work of the Office.

To give effect to these objectives, the process of planning and implementation of the Bureau for Employers' Activities takes the following form:

• defining its mission
• an environmental analysis
• objective formulation
• strategy formulation
• programme formulation
• implementation
• evaluation

Strategies to achieve these objectives consist of technical cooperation programmes to assist:

1. employers' organizations to develop a strategic perspective of their development and an action plan to achieve this strategy. Such a plan identifies the needs of the enterprise sector as well as the key challenges and strategic issues to be addressed, the direction of the organization's development and the means to reach the development goals, how they propose to adapt to the changing environment and anticipate members' needs, and to compile a profile of how the organization should look after the implementation of the plan.
2. in increasing the technical capacity, skills and knowledge base of the organizations, especially through staff development and an information/research system;
3. in developing and providing direct services to members, and to transform such services into income-generating ones;
4. in developing the training role and capacity of the organizations.

A combination of means and methods is adopted to give effect to these strategies. It includes advisory services and consultancies,, training programmes, workshops and seminars, research and training materials, individual and group study tours/fellowships to more developed employers' organizations, and harnessing the expertise of more developed employers' organizations for the benefit of less developed ones. Members of the employers' organization are also associated in some programmes of the ILO, such as seminars, workshops and some training programmes. This is considered effective in terms of implementation of policies, and has a multiplier effect.

In providing technical assistance to employers' organizations, in addition to the role of the Bureau for Employers' Activities, the ILO's Active Partnership Policy (APP) is also an important means of delivering services to the organizations. The APP focuses, inter alia, on the following:

• Country objectives which help to clarify the main development objectives in a country, including those of the social partners which are identified by the Bureau's field staff in each region (employers' specialists). This process helps to focus technical cooperation in relevant areas.
• A multi-disciplinary advisory team in each sub-region which in most cases has an employers' specialist. There is potential, where appropriate, to harness the expertise of other team members to assist employers' organizations.

The employers' specialists in these teams are provided with support by the Bureau for Employers' Activities in, for instance

• policy issues
• information
• back stopping, especially in the case of projects.

Employers' organizations are encouraged and assisted to formulate long-term development plans which consist of different elements and stages, each step building upon the other. It is within the framework of such plans that the ILO's programme of technical cooperation fits in to assist the organizations to achieve their development objectives. In this context the programme utilizes different sources of funding to complement each other in the implementation of different parts of the plan. Such different sources of funding include

• regular budget funds for employers' activities
• donor funding
• support from developed employers' organizations
• resources from Regional and Area Offices, and from Multi-Disciplinary Teams.

The advantages of this approach are as follows:

• It results in employers' organizations taking a long-term perspective of their development and developing a concrete, identifiable development path, which responds to enterprise needs.
• It helps donors and the ILO to see how their assistance promotes the development of the organization. Conversely, it helps to avoid ad hoc activities which have no sustainability

Policy Formulation at the National Level

This involves enhancing the technical and professional capacity of employers' organizations to influence labour-related policy formulation. Some keys to the effectiveness of employers' organizations in this regard are

• the ability to assess and influence the external environment
• investment in staff
• possession of up-to-date, well researched and analysed information.
• the ability to use and apply such information and knowledge.

These are essential to an organization's ability to prepare its position, debate issues with and convince the other tripartite constituents, and where necessary, the public.

The ILO's role (and the focus of its employers' activities in this regard) is to strengthen the relevant capacities of the organizations in particular technical areas of their work (e.g. in industrial relations), as well as in areas such as membership promotion (since representativeness is critical to the ability to influence policy decisions) and income generation.

Employers' organizations need to be equipped with the capacity to advise and influence the government which labour market interventions are appropriate for the efficient functioning of the market, and which interventions would be obstructive.

Institution Capacity Building

Efficient and effective employers' organizations and assistance to achieve sustainable development need to be built around four key areas:

• a clear vision of where the organization wants/needs to be and a plan to translate this vision into reality
• an organization composed of staff with the requisite knowledge and skills
• a reliable and up-to-date information and knowledge base on labour market matters
• relevant services developed to meet the needs of enterprises.

1. A Strategic Vision. During the last two to three years, and in the next few years, employers' organizations have been/will be assisted to develop a comprehensive and integrated plan, identifying the directions of their future development, their objectives and mandate, the strategic issues which need to be addressed, and their core competencies which need to be developed. This has resulted in the ILO being better placed to identify where its resources should be directed (e.g. training skills or information systems) so as to generate greater impact of technical cooperation. Employers' organizations are being encouraged to pay more attention to the changes in the environment in which they operate, their mission vis-à-vis their members and national goals, and the core competencies needed to give effect to the mission.
2. Staff Development. The quality of an employers' organization's staff affects its

• professionalism
• quality of services since delivery of services has to be also, though not only, through its own staff
• policy lobbying capacity
• potential to attract new members
• capacity to generate income over and above membership subscriptions.

Besides, employers increasingly expect from their organizations the same professionalism they expect from other professionals such as lawyers, financial advisers, etc. who provide them with services. Staff skills are affected by:

• the organization's recruitment policy based on a skills profile to fit membership needs
• a development and training policy. Other than on-the-job training, there are virtually no training opportunities for staff due to the absence of institutions and courses which cater to their needs. As such, the ILO is the main external source of training
• income

While the skills and expertise needed varies among countries and depends on the type of services, usually the core skills would include labour relations skills; the expertise needed to deliver up-to-date knowledge to members on labour market issues; research and information analysis skills which increasingly include economic analysis; and training skills. Due to the difficulty (from a financial point of view) of having too many specialists, one solution is for the organizations to develop multi-skills among staff so that, for instance, staff with specialized knowledge can also contribute to the training programmes of the organization.

3. Information, Knowledge, Research and Training Material. The quality of an employers' organization's information and research is important to its lobbying role; decision-making on labour issues at the enterprise level; and to its functions relating to advisory services, negotiations with unions, representation of employers (e.g. before labour courts and the labour administration authorities), and training of enterprise personnel. Further, members expect to be provided with well researched up-to-date information not only on the domestic labour market but also on regional (and even international) trends and practices. Foreign enterprises, which are a potential source of membership in countries receiving foreign direct investment, find high quality researched information on the domestic labour market a good enough reason for joining the national employers' organization.

Experience with employers' organizations and their enterprises indicates that a significant trend in the 1990s, namely, the move to a knowledge-based society is not confined to industrialized societies. In rapidly industrializing and developing countries as well as economies in transition, there is an increasing market for relevant knowledge. The following demands for information and knowledge are illustrative:

• Knowledge of the labour laws and IR systems in other countries, especially those of successful economies. The expectation here is for information on how other IR systems have worked in practice, what type of labour laws they have, enterprise level policies and practices to generate labour-management cooperation, and how globalization impacts on IR.
• The human resources development policies of successful economies, how countries have addressed their skills needs and have prepared their workforces to meet rapidly changing skills requirements.
• Wage and pay systems e.g. minimum wage determination criteria and performance and skills related pay.
• Information on how employers are using HRM policies and practices to gain competitive advantage.

These and similar expectations have created a potential for well-researched publications. However, knowledge is productive only when it is applied. Therefore developing training materials which can help to turn knowledge to productive use is an emerging need of employers' organizations.

In these circumstances employers' organizations could be assisted by the ILO in the following ways:

• The establishment or upgrading of an information/research system.
• Training in the management of such a system.
• Development of survey skills and techniques, and in the analysis and presentation of the results.
• Development of training material based on the knowledge/information accumulated and the skills to apply it.

Promoting Enterprise Competitiveness

1. Industrial Relations and Human Resources Management

The industrial relations (IR) role of an employers' organization, which represents the most important difference between such organizations and others in countries where the economic and social policy roles are fulfilled by different organizations, continues to be important. Employers are concerned with how globalization impacts on the national IR system, and how the focus of IR is changing as a result e.g. the greater emphasis on relations at the enterprise level. They are becoming aware of the need to develop a strategic perspective of IR i.e. how IR can contribute to productivity, quality and competitiveness, and are paying greater attention than before to the promotion of a sound IR system at the enterprise level.

At the levels external to the enterprise (national and industry levels), employers' organizations are expected to influence labour policy and legislation, seek to achieve a common perspective in regard to them, participate in tripartite processes and mechanisms, negotiate on behalf of members, promote dispute prevention and settlement procedures, and generally promote a climate and structure conducive to sound IR at all levels. An important role for employers' organizations is to ensure the efficient functioning of the labour market.

With the increasing focus on workplace relations as a key to sound IR, employers expect a range of services which include: information on minimum wage determination criteria and on market wage and salary rates; guidance and assistance in introducing pay systems linked more to performance and skill criteria than traditional pay systems which are the outcome of negotiations based on cost of living, seniority and job evaluation criteria; provision of dispute prevention and settlement services; advisory services on workplace cooperation mechanisms, two-way communication and employee involvement schemes; information on flexible work arrangements. Globalization is compelling a focus on

• transforming conflictual relations into cooperative ones
• sound workplace employment relations as one key to productivity enhancement
• employee development, especially in terms of skills training
• flexible work arrangements and flexible forms of employment
• pay geared to output rather than time spent on the job
• the relationship between productivity and low/high wages
• balancing efficiency with equity in the labour market

In these circumstances employers are resorting to strategic human resource management as a means of achieving competitiveness. This is sought to be achieved through matching individual with corporate goals and integrating an HRM perspective in the functions of line managers.

With increasing foreign investment employers (and workers) are facing cross-cultural management issues, flowing from "cultural mismanagement" resulting in many disputes. As such, programmes on managing people in a cross-cultural environment will be an important service which employers' organizations could offer to both foreign investors and local managers and supervisors.

In these priority areas the ILO's programmes for employers' organizations focus on

• increasing their labour relations information and knowledge base
• increasing their IR and HRM training capacity
• developing the negotiation skills of the staff
2. Productivity

Given that productivity is a key to competitiveness and better living standards and is now a major concern of employers (and of governments) in developing countries, the need to define the services an employers' organization can realistically provide in the area of productivity has arisen. Being basically an enterprise level issue, the organization's role needs to be clearly identified. Some of the areas in which employers' organizations can assist are by

• playing a promotional and awareness raising role where necessary
• promoting the strengthening of labour management cooperation at the enterprise level
• promoting and engaging in productivity bargaining or negotiation
• promoting and advising on pay systems geared to productivity and performance criteria
• undertaking training in effective HRM
• the collection of information and the preparation of case studies on flexible work arrangements and other employer initiatives which have contributed to productivity enhancement
• advisory services on safety and health practices which engender higher productivity
• influencing the policies and programmes of national productivity institutions
• promoting training as an important factor in productivity improvement.
3. Small Enterprise Development

Problems of attracting small enterprises to the membership of employers' organizations are due chiefly to the propensity of such enterprises to require a "one stop shop" providing the economic and business services as well, and to the belief in their capacity to manage their own labour problems. This sector provides the greatest membership potential for employers' organizations, both in terms of its numbers and importance to the national economy. This potential could be exploited by developing services for small enterprises such as

• articulating the policy, legal and regulatory issues which concern small enterprises
• training in small business management and entrepreneurship
• information
• human resource management services
4. Safety and Health

The 1990s have witnessed a surge of interest among employers' organizations in OSH, no doubt reflecting the increased interest of enterprises in the context of legal prescription, the link between safety and health and productivity, the image of enterprises, and the increasing workplace hazards in industrializing countries.

An employers' organization's services in OSH, at the national and enterprise levels, should be carefully defined given that many aspects of the subject are highly technical and beyond the capacity of organizations of employers. At the national level a national consciousness on OSH can be created among employers through awareness raising on issues such as OSH and its effects on productivity. In this context employers' organizations could be involved in establishing or strengthening national safety and health promotional or similar tripartite or bipartite bodies; identifying the respective roles of governments and the organizations of employers and workers; providing advisory services; designing safety campaigns, and disseminating information.

At the enterprise level employers' organizations could promote self-regulation of safety and health through

• establishing or upgrading safety and health information and management systems and OSH practices
• establishing and training safety committees
• training supervisors
• providing advisory services

As a next step organizations could be assisted to develop their advisory and consultancy capacity relating to

• making safety audits
• interpreting OSH legislation
• advising on safe work practices
• organizing safety promotion campaigns
• developing advisory and representational services in compensation claims/issues before the relevant authority
• developing dialogue with unions
• providing information on the OSH implications of new technology and processes by, for instance, establishing an information database linked to other information centres
• developing supervisory training programmes
5. Environment

The environment is an area that is relatively new for employers' organizations, but one in which they have a useful role to play. Enterprises are increasingly under pressure to improve their environmental performance. They are gradually coming to realise that reducing waste through low-cost and no-cost measures, like better housekeeping, not only reduces the greatest part of their pollution, but also results in resources being used more efficiently and cost savings for the business. This is the concept of cleaner production, which links business motives to the objective of making a cleaner world. Much of the work involved in conducting cleaner production audits in enterprises can be accomplished by sufficiently trained generalists. Employers' organizations are ideally suited to provide such services, combined with environmental awareness-raising and the influencing of policy. The ILO programme of assistance to employers' organizations trains officials of employers' organizations to seize this opportunity. An additional benefit from such services is the increased value they place on good industrial relations (often the employers' organization's main product), because cleaner production demands motivated participation by everybody in the enterprise.

Developing Human Capital

Human Resources Development (HRD). The socio-economic development of countries (in terms of investment, employment and raising of living standards) and the competitiveness of enterprises (which is a key factor in socio-economic development) are now, more than ever, linked to the quality of human resources. Therefore the necessity for employers' organizations to be involved in issues relating to the development, utilization and allocation of human resources has considerably increased.

The cost of investment in human capital is so high that all the tripartite constituents need to share some part of the responsibility. It is no longer possible - or desirable - to leave HRD exclusively to the State, whether in terms of planning or expenditure. The role of employers and their organizations could include the following:

1. Employers' organizations can influence the direction and quality of education to conform to business needs, and encourage symbiotic relationships between enterprises and schools/teachers. Employers are in a position to acquaint schools and students with the choices available to them in the labour market and what businesses require by way of educational attainments.
2. Employers' organizations need to represent employers on skills training policies, needs and methods of delivery and be the link between training (and education) authorities and employers.
3. Employers' organizations need to act as catalysts in encouraging more investment by employers in training, seeking also to diffuse a training culture across the economy. There is a gradual shift from training as a responsibility of the government through public training institutions to one of shared responsibility, with employers needing to improve general skills but more particularly firm-specific skills.
4. Employers' organizations could also help to develop incentives for employers to increase their training activities. Employers in several countries are searching for information on incentive systems in other countries.
5. The increasing resort by employers in the current decade to skill-based pay systems creates opportunities for employers' organizations to assist by way of information, advice and negotiation with unions.
6. Wherever appropriate, special attention will be paid to gender issues. Employers' organizations will be encouraged to influence the removal of gender biases in laws and employment practices, and to promote special programmes to encourage women entrepreneurship among women and training.

Child Labour

Employers' organizations are increasingly aware of the importance of their role in international efforts to combat child labour, particularly in its most exploitative and intolerable forms. The issue of child labour is on the agendas of many employers' organizations, some of whose members have faced the threat of shrinking markets as their buyers refuse to purchase goods manufactured under sub-contracting arrangements where child labour is used. As such, child labour which is an issue of concern to consumers is a consideration which should concern the business community.

The Bureau for Employers' Activities has responded to these concerns by promoting and supporting action by employers' organizations to play a role in international efforts to combat child labour. To this end, the Bureau is working closely with the International Organization of Employers (IOE), in accordance with a Resolution on Child Labour, calling on its members to raise awareness of the human, economic and social costs of child labour and to develop action plans for child labour abatement.. Accordingly, the Employers' Bureau is putting these intentions into practical effect in close collaboration with IOE member federations and with the ILO's International Programme on the Elimination of Child Labour (IPEC). In each of the IPEC's twenty-five member countries, the employers' organization are assisted to play an influential role on the National Steering Committees to develop and oversee the implementation of the national plans of action. The Bureau will be working to develop the capacity of employers' organizations to assist their members who are facing the problem of child labour. As a first priority, the Bureau will develop employer action programmes focussing on removal and rehabilitation of child labour in South Asia and in English-speaking Africa. The employers' organizations who adopt such programmes will gain national recognition as leaders on this issue and as the most suitable organizations to coordinate the various sectoral programmes which are developing to phase out child labour in particular industries.

For further information, please contact Bureau for Employers' Activities (ACT/EMP)
at Tel: +41.22.799.7748, Fax: +41.22.799.8948, or E-mail: actemp@ilo.org