During the COVID-19 pandemic, Latin American governments took the unprecedented step of including informal workers in emergency relief legislation. Informal workers comprise a significant share of Latin American countries’ economically active population, ranging from 23.9% in Uruguay to 82.6% in Honduras, and they have been among those hardest hit by the pandemic. Their inclusion in the pandemic response thus seemed like a harbinger of progress. But, on closer inspection, the move highlighted the unintended consequences of failing to consult with those most affected by legislation before it is enacted.
Legal recognition of informal workers is not only symbolically important. It has significant material implications. Historically, informal workers’ status rendered them invisible to the state in Latin America. Because they were not defined as employees under labor laws, they were not eligible for employment-based social protection. And they are not poor enough to qualify for social assistance.