World Bank Index Undermining Labor Rights- Trade Union

The World Bank’s newly launched Business Ready (B-Ready) Index has faced criticism from the International Trade Union Confederation (ITUC) over concerns about its data collection methods and decision-making process.

The B-Ready Index assesses the business and investment climate by offering a comprehensive dataset that highlights factors strengthening the private sector.

It also aimed to promote not just firm-specific growth but also the interests of workers, consumers, new enterprises, and the environment.

The 2024 report introduces a new framework that benchmarks economies based on three pillars: Regulatory Framework, Public Services, and Operational Efficiency, evaluating key areas across a firm’s life cycle.

However, the ITUC expressed concern that the B-Ready report promotes competition at the expense of labour standards.

The General Secretary of ITUC, Luc Triangle, criticized the ranking system for encouraging competition that undermines workers’ rights.

He said, “As workers around the world face brutal retaliation for exercising their right to organise a union and improve their working conditions, it is deeply troubling for the World Bank to rank countries in a way that stimulates competition to erode labour standards.

“There is no shortcut for democratic consultation and social dialogue on labour market practices. Reforms based on such an unbalanced analysis will be misguided at best and dangerous at worst.

“Labour policies are not simple inputs, like business licenses or utility hook-ups, and they can’t be ranked in the same fashion. Trade unions globally argue that labour is not an appropriate topic for the B-Ready Index and should be removed.”

Triangle emphasized that labour policies require democratic consultation and social dialogue, warning that reforms driven by such an analysis could lead to misguided or even harmful outcomes.

He also argued that labour policies, unlike business licenses or utility access, should not be ranked in the same manner.

ITUC also expressed disappointment in the World Bank’s methodology, claiming that despite attempts to engage, workers’ concerns were disregarded.

The union criticized the B-Ready Index for superficial evaluations of workers’ rights, allowing countries with poor labour conditions, such as the Philippines and Indonesia, to score well.

Triangle said, “The B-Ready Index has critical flaws, particularly in its superficial evaluation of workers’ rights, allowing countries like the Philippines and Indonesia to score high despite poor records. This undermines its credibility and encourages superficial reforms,” the ITUC general secretary said.

“Its approach also encourages harmful flexibility, such as unlimited fixed-term contracts and inadequate wages, while eroding collective bargaining, ultimately contradicting the goal of inclusive development.

“The B-Ready Index is a renewal of the World Bank’s previously discredited Doing Business Report, which was discontinued in 2020 following serious methodological and data failures and widespread criticism by academics, trade unions and civil society”.