Undeclated Work and Legal Consequences

Abstract

The development of new directions for the effective functioning of the labor sphere in Ukraine and measures to eliminate the negative trends currently taking place are impossible without researching such a negative economic phenomenon as the informal sector of the labor market. Currently, research on undeclared work is gaining special relevance, since the labor market as a dynamic system depends on the political and economic situation in the country. The informal sector of the labor market and undeclared work in the formal sector have common features, namely illegal employment of an employee or registration of an employee without concluding an employment contract, which is provided for by the current legislation of Ukraine.
 Thus, there is concealment of actually worked hours, payment of wages "in an envelope", replacement of actual employment contracts with civil and economic ones, non-payment of taxes and a high probability for employees to remain unemployed. At the same time, in the event of an injury at the productions of the informal sector of the labor market, the injured employee must spend considerable personal funds on treatment without any compensation payments. It is shown that currently in Ukraine there are no unified approaches to the interpretation of the content of the shadow economy, which leads to the absence of both methods of assessing its scale and scientific research on the development of approaches and ways of countering it.
 It has been proven that measures to reduce the number of people employed in the informal labor market are ineffective, because there is the tendency to increase the number of people working in the informal sector of the labor market. It is proposed to strengthen the motivation of legal employment and consolidate the efforts of social partners against shadow employment in order to implement such a policy in the field of labor protection in the state that would ensure decent working conditions at every workplace and contribute to reducing the volume of the shadow economy. The expediency of expanding the range of measures to encourage employers to participate in the formal labor market and the development of the scientifically based comprehensive national program of productive employment, aimed at ensuring a balanced supply and demand of labor on the labor market, was noted.
 The obtained theoretical conclusions are the basis of specific proposals intended for the planning of labor protection measures both at enterprises and in those sectors of the labor market where undocumented workers work.