Constraints on Firms for Providing Safer Workplaces for Female Workers

Why don’t firms invest in safer workplaces for women? Female labour force participation in developing countries like India is low and has been falling, but safer workplaces may encourage more women to participate in paid employment. In turn, attracting more women, and skilled women in particular, into the labour force can contribute to firms’ productivity and promote inclusive growth. However, according to anecdotal evidence, few firms in India comply with government regulations on workplace safety, particularly the Sexual Harassment of Women at Workplace Act (SHWA) passed in 2013 to promote a safer workplace environment for women through mandated policies.

In this project, Beaman, Sharma and Sharma provide evidence on a profit-maximizing firms’ constraints to providing a safer working environment for its female employees in an environment where implementation of the law may be weak. They analyse why firms do not invest in key amenities such as gender sensitisation programmes and training, as well as establishing an effective complaints mechanism to tackle concerns about workplace safety. They partner with the Federation of Indian Chambers of Commerce and Industry (FICCI) to survey a sample of FICCI member firms to better understand what constraints they face in hiring and retaining female employees, whether they are aware of the regulations around workplace harassment and the extent to which they comply with these laws.

In addition, they implement two interventions where they experimentally provide information to firms about job-seeker preferences over workplace amenities and job characteristics, as well as information about mandated requirements of the SHWA. Through these interventions, they will identify whether either source of information leads to an increased willingness by firms to investment in workplace safety, measured through multiple outcomes, such as attending a webinar on complying with the law hosted by Safecity, an NGO focused on reducing sexual harassment including at the workplace, and investing in workplace safety audits.

The data generated in this project will provide important insights that can inform policymakers about firms’ awareness of and compliance with the SHWA, and how this varies across different types of firms (size, industry, leadership structure). The RCT will also shed more light on the specific constraints that hold back firms from investing: whether they lack sufficient information about job-seeker preferences, information about the law, or whether they face financial constraints that prevent them from taking up these additional investments.

This project has also received funding from the Private Enterprise Development in Low-Income Countries (PEDL) coordinated by the Centre for Economic Policy and Research (CEPR).