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Experts Call for Developing Insurance Mechanisms to Include Informal Workers in Social Security

Phenix Center
Experts Call for Developing Insurance Mechanisms to Include Informal Workers in Social Security
Experts unanimously emphasized the necessity of developing effective and sustainable insurance tools to include informal workers in Jordan’s social protection system, allowing them to benefit from the coverage provided by the Social Security Corporation.
This consensus emerged during a dialogue session held by Phenix Center for Economic and Informatics Studies in collaboration with the Friedrich Ebert Stiftung (FES) last Tuesday 15 August 2023. 
The session brought together experts, professionals, and stakeholders in the field of social protection to discuss how informal workers may be included in the social security.
Ahmad Awad, Director of the Phenix Center, introduced the session and stated that despite the progress achieved by the Social Security Corporation since its establishment, approximately half of the workforce in Jordan still remains outside the coverage of social security and lacks any form of social protection. 
Awad perceived this as a significant gap within Jordan's social protection system, prompting the need to contemplate how to develop suitable, effective, and sustainable tools and mechanisms with reasonable costs to make social security more inclusive. 
He emphasized that it is part of the state's responsibilities, through its government and the Social Security Corporation, to take measures and develop initiatives to realize the fundamental Human Right to social security for all.
On his part, Hossam Al-Saadi, the Director of Insurance Awareness Office at the Social Security Corporation, stated that the corporation relies on principles of support, encouragement, and incentivization to expand the inclusivity of social security coverage. 
This approach is grounded in the recognition that social security is a right that provides numerous benefits and insurances forall employees regardless of gender.
He pointed out that the Social Security Corporation has endeavored to attract and include Informal labor under its coverage through the (Estidama ++) program, which was launched by the corporation in mid-2022.
He explained that this program offers cash support to workers and employers to alleviate the cost of subscribing to social security. He mentioned that the initial phase of the program targeted self-employed workers and small and micro-sized establishments with fewer than 10 employees. He noted that most ofinformal labor in Jordan is concentrated within these establishments.
Al-Saadi also highlighted that many employers evade enrolling their workers in social security due to the associated costs. This avoidance extends to self-employed individuals who opt out of voluntary participation due to the high cost, amounting to 17.5% of their monthly income.
Mousa Al-Sabehi, an expert on social insurance, mentioned that the issue is not limited solely to informal workers. There are many workers in formal sectors who are not covered by social security. 
Their proportion amounts to around 17%, according to previous studies conducted by the Social Security Corporation. Al-Sabehi highlighted that a significant portion of informal labor is concentrated in sectors such as agriculture, construction, public transportation, small trades, and crafts.
He emphasized that expanding coverage requires a gradual integration of uncovered workers in the informal sectors, followed by a focus on those uncovered in formal sectors. Additionally, he suggested that the government should provide tangible incentives to workers to facilitate their inclusion in the social security system.
As for Hamada Abu Najma, the Director of "Workers' House” stated that the main reasons behind the increase in informal work is the exclusion of wide categories of workers from the provisions of the Social Security Law, such as domestic workers and those who work less than 16 days per month. 
Additionally, significant insurance evasion occurs due to various factors like lack of awareness, indifference, or financial burden on the part of many employers. Abu Najma emphasized that awareness campaigns, monitoring, and inspection processes should be built upon establishing trust between employers and the Social Security Corporation. 
A substantial portion of employers view social security enrollment as a financial burden rather than a right for both themselves and their workers. 
He believed that enhancing trust requires improving the benefits and insurances provided by the Social Security Corporation. For instance, this would mean ease in shifting from disability insurance to unemployment insurance, as well as developing a fair and sustainable healthcare coverage.
Participants in the session underlined the necessity of reducing the cost of social security subscriptions, especially optional subscriptions, which burden informal workers. They also stressed the importance of raising awareness among employers about their rights and duties and the rights of their workers to be included under the umbrella of social security.