Business environment, labour law, and micro- and small enterprises

1. This paper responds to the decision by the Officers of the Committee on Employment and Social Policy (ESP) to include an item for discussion on the agenda of its November 2006 session on the topic of business environment, labour law, and microand small enterprises. The paper sets out to address the dilemma of striking a balance in terms of minimizing the cost of the regulatory burden on microand small enterprises and thus enhancing the prospects for competitiveness and growth, without compromising the protection of those who work in MSEs. This is an issue of growing international debate and the Office is increasingly being asked to provide guidance to constituents and other agencies. The topic was discussed by the ESP Committee during the 289th Session of the Governing Body, when Core Component 5 of the Global Employment Agenda was on the agenda. It was also discussed during the 90th Session of the International Labour Conference in 2002 on decent work and the informal economy. A number of tentative recommendations are provided in this paper and the Committee is requested to provide guidance to the Office on how to further this area of work.