Benefits to Using Blockchain as a Humanitarian Tool for Labor Equality

Blockchain is most recognizable as a financial tool, gaining prominence as the underlying technology behind cryptocurrency. As these systems have become more popular, new use cases have emerged. One lesser-publicized but promising application of blockchain technology is in humanitarian efforts, specifically for labor equality.

Issues of labor inequality have captured increasing public attention as the world has grown more connected. These are typically complex problems that no one solution can solve entirely, but blockchains could help. The security, relative anonymity and transparency of these tools make them ideal for addressing labor equality concerns.

Here are a few ways organizations could benefit from using blockchain technology as a tool for labor equality.

Uncovering Fraud and Corruption

Blockchains’ transparency has made them an increasingly popular solution for fraud prevention. Many financial institutions, including the National Bank of Canada, have already started using blockchain fraud prevention services. Similar solutions could uncover corruption within businesses, helping find and penalize unfair labor practices.

Every blockchain transaction is transparent and uneditable, allowing users to see exactly where money flows through a system. If blockchains became the standard for business transactions, this transparency would hold company leaders accountable. If they were withholding wages, embezzling employees or otherwise engaging in unfair financial practices, authorities could see it.

Alternatively, companies that embrace blockchains in this area would cultivate an atmosphere of trust. Workers could feel more comfortable working in these businesses since they would be transparent about how they handle their finances.

Contract Transparency

Another benefit of using blockchains as a humanitarian tool is creating more clarity and trust in employment contracts. Smart contracts, blockchain-based protocols that automatically execute the pre-determined terms of the contract, prevent employers from avoiding their responsibilities to their workers. Since they exist as unchangeable blocks in the chain, employers couldn’t maliciously change them, either.

Unclear contracts and responsibilities have been a struggle for fair labor in the past. For example, the definition of a joint employer has frequently changed over the years, leading to confusion and frustration. Smart contracts remove that, however, by providing a transparent record of all an agreement’s terms and executing them automatically.

Smart contracts could automatically compensate employees, including any necessary hazard or overtime pay, without dispute. Automating processes like this would stop corrupt employers from upholding their obligations to their workers. Employee morale would rise from the security of knowing they’ll receive fair compensation.

Empowering Women in the Workplace

Gender inequality is one of the most pervasive labor equality issues in today’s workplaces, and blockchains can help here, too. In many workplaces and markets, women struggle to gain power over their own finances and careers. Blockchain technology can help work around historic barriers by providing decentralized, secure access to funding.

In 2017, innovators created a blockchain-based money transfer system to empower women as part of a UN-run competition. The service enables women entrepreneurs to securely and quickly access small loans or other finances. With tools like this, they can generate and manage the capital needed to start a business in otherwise male-dominated industries.

Blockchain-based payment can also increase visibility into how a company compensates men and women. Businesses could pay employees through the blockchain, evidencing how they pay women equally. This transparency could attract more employees, especially women, who want to work in a more progressive workplace.

Giving Workers a Voice

One of the best ways to improve labor equality is to let workers speak out about their experiences. Traditional communication systems are often ineffective in this area because they may not be entirely anonymous and provide little to no accountability. Blockchain-based communication channels solve both of these issues.

Blockchain records can be fully anonymous, letting workers speak up without fear of retribution. Since their messages would be secure as blocks in the blockchain, their voice could also reach its intended audience. Management couldn’t edit or hide the message, and anyone with access to the blockchain could read it.

These tools could help workers bring light to unfair labor practices, leading to positive change. Companies that provide these types of communication channels would benefit from fostering an air of trust and respect. Workers would be happy knowing that the company values their input.

Blockchains Can Help Solve Long-Standing Labor Issues

Using blockchain technology as a humanitarian tool is a new but promising concept. If more organizations provided these types of tools, they could protect workers’ rights and create fairer workplaces. The world could then start to move past long-standing issues of workplace inequality.

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