While employers' organisations in different countries are developing capacity to provide direct support services to small and medium-sized enterprises (SMEs), in India associations of small entrepreneurs lack adequate links with employers' organisations, according to the World Labour Report, 1997.

Associations of micro-entrepreneurs in Argentina, Brazil, Peru and India "generally lack organic links with the other employers' organisations," the International Labour Organisation (ILO) says in its report released on Tuesday.

Stating that the proportion of SMEs has been growing in all countries, industrialised or not, the report says few of them tend to join representative employers' organisations.

Affiliation rates remain extremely low in developing countries and " even in industrialised countries many SMEs balk at having to follow rules which are accepted at the sectoral or national level".

Referring to social dialogue and collective bargaining in South Asia, the report says labour laws in the countries of the region are still under-developed and less conducive to promotion of collective bargaining.

"In South Asia, the legalistic tradition is less developed and thus less inhibiting to collective bargaining but the mechanisms which facilitate social dialogue are on the whole, still under-developed", the report says.

The proportion of employees covered by a collective agreement rarely exceeds four per cent in most countries of the region, although there are some notable exceptions, including South Korea where unionisation rate is around 17 per cent and approximately the same percentage of workers are covered by collective agreements.

On industrial relations and the informal sector, the report notes that trade unions, employers' associations and governments are paying increasing attention to workers in the vast and growing informal sector.

Trade unions have sought to integrate informal sector workers in the Union membership. Others have centred on creation of "strategic links with informal sector associations by providing them with guidance and capacity-training services. Alliances of this type already exists in several developing countries including Brazil, India, Venezuela and Burkina Faso.

Employers' organisations are in the best position to promote modernisation of informal sector.

Whatever, may be the assistance from trade unions and employers' organisations, the report makes it clear that the state has a major role to play to help informal workers overcome their disadvantage.

With regard to capital mobility and its impact on industrial relations, the report identifies three principal changes to industrial relations brought about by capital mobility -- a reduced margin of manoeuvre for governments, greater autonomy for enterprises and increased competition for jobs and investments, the report says.

Increased trade flows and capital mobility are transforming traditional industrial relations and collective bargaining, it says.

While, globalisation is not leading to a large-scale industrial migration of firms fleeing high costs and taxes, it is generating increasing options for firms to maintain or relocate manufacturing investment, it says. The report said labour unions suffering from plunging membership must adapt to the realities of an increasingly globalised economy.

"In the United States, union membership among waged and salaried workers fell by 21.1 per cent from 1985 to 1995, giving it one of the lowest levels of unionisation among industrialised countries," said the report.

The figures used predate last summer's strike at united parcel services, widely seen as a turning point in union fortunes.

"The era of precipitous decline is past but that doesn't mean it has turned round," ILO spokesman John Doohan said of US membership.

Union membership has dropped most dramatically in the former communist countries of eastern Europe, with an average decline of 36 per cent from 1985 to 1995.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.