• In a draft report, the World Bank has suggested employers should be able to opt out of paying minimum wage.
  • It recommends that labor markets should be further deregulated, creating more flexible employment.
  • Owen Tudor, the head of international relations at the International Trade Union Committee, said the World Bank could be spreading an “equality of misery” with the proposals.

LONDON – The World Bank has suggested that employers should be able to opt out of paying minimum wage, recommending reduced worker rights to make humans more cost-competitive with machine labor.

A draft of the bank’s World Development Report released Friday outlines proposals for the future of work that have outraged international labor organizations, which have called them “bizarre” and “troubling.”

The WDR calls for fewer labor rights and less “burdensome” regulations allowing companies to hire employees at lower cost.

It is expected to urge policy action from governments around the world upon its final release in the fall.

Owen Tudor, the head of international relations at the International Trade Union Committee, told Business Insider that the bank's proposals could spread an "equality of misery."

Tudor said the organization seemed to be out of touch with working people and reality, adding: "It is bizarre that the World Bank is now doing this … The world needs a pay rise, and taking away workers' rights is not the way to do that."

Proposals in the WDR draft include:

  • Allowing employers to opt out of paying minimum wages if they introduce a profit-sharing plans for their workers.
  • Employment contracts with greater flexibility that allow companies to hire and fire employees more easily.
  • Advocacy of UK-style zero-hour contracts.

"High minimum wages, undue restrictions on hiring and firing, strict contract forms, all make workers more expensive vis-à-vis technology," the WDR draft said.

Peter Bakvis, the Washington representative for the International Trade Union Confederation, told The Guardian that the report "almost completely ignores workers' rights, asymmetric power in the labor market, and phenomena such as declining labor share in national income."