Labour Rights in India’s Gig Economy

Labour Rights in India’s Gig Economy
Labour Rights in India’s Gig Economy

Introduction

The rise of the gig economy in India has transformed the landscape of employment. Gig and platform workers—delivery partners, ride-hailing drivers, freelance service providers now constitute a significant segment of the workforce. As of 2024, India had over 7.7 million gig workers, with projections suggesting this number will reach 23.5 million by 2030. Despite their economic contribution, these workers have historically lacked access to formal labour rights such as social security, job security, or workplace protections.

Who Are Gig and Platform Workers?

  • Gig workers: Individuals engaged in income-earning activities outside the traditional employer-employee relationship, often on a short-term or task-based basis.
  • Platform workers: A subset of gig workers who use online platforms (e.g., Swiggy, Zomato, Uber, Ola, Urban Company) to access clients and earn income.

Legal Framework: Labour Laws and Gig Work

1. Code on Social Security, 2020

This central legislation was the first to formally recognize gig and platform workers. Key provisions include:

  • Definitions:
    • Gig worker: A person who performs work outside traditional employment.
    • Platform worker: One who accesses work through digital platforms.
  • Social Security Schemes:
    • Enables the central and state governments to frame schemes for:
      • Life and disability cover
      • Health and maternity benefits
      • Old age protection
      • Crèche facilities and more
    • Funding:
      • Allows collection of a welfare cess (1-2% of platform companies’ annual turnover) to fund worker welfare.
    • Registration:
      • Gig and platform workers can self-register to avail of these benefits.

However, implementation has been sluggish, and most schemes remain on paper due to a lack of institutional infrastructure and clarity on inter-state coordination.

Recent State-Level Developments

1. Rajasthan (2023)

  • Rajasthan Platform-Based Gig Workers (Registration and Welfare) Act, 2023:
    • First of its kind in India.
    • Mandates:
      • Creation of a welfare board
      • A transaction-based welfare fee
      • Mandatory registration of workers and platforms
    • Current Status: Although the law was passed, its implementation has been limited due to political and administrative delays.

2. Karnataka (2024–2025)

  • Recently approved the Karnataka Platform-Based Gig Workers (Social Security and Welfare) Bill, 2024.
  • Proposes:
    • A 1–5% cess on every platform-facilitated transaction
    • Mandatory notice periods for termination (14 days)
    • Worker rights to refuse unsafe or low-paying jobs
    • Greater algorithmic transparency from platforms
  • Industry Pushback: Tech companies and NASSCOM have raised concerns about feasibility and operational disruptions.

3. Telangana (2025 Draft Bill)

  • Drafted its own version of a welfare law, including:
    • Mandatory registration of gig workers
    • Creation of a welfare board
    • Health and insurance schemes
  • Inspired by Rajasthan’s model but more tech-industry friendly.

Challenges Faced by Gig Workers

  1. Lack of Social Security: No access to ESI, PF, or health insurance unless self-arranged.
  2. Unpredictable Income: Due to algorithmic assignments and fluctuating demand.
  3. No Grievance Redressal Mechanism: No formal complaint system against arbitrary terminations or wage disputes.
  4. Algorithmic Exploitation: Workers have little to no insight into how task assignments and incentives are determined.
  5. Workplace Harassment and Safety: No clear policies or enforcement regarding working conditions, especially for women workers.

Unionization and Worker Activism

  • Organizations like Indian Federation of App-based Transport Workers (IFAT) and Gig Workers’ Association of India have been at the forefront of advocating for rights.
  • Major protests were seen in Delhi, Bengaluru, and Hyderabad in 2023–2024 over issues like deactivation without notice, commission cuts, and long working hours.

Way Forward

  1. Effective Implementation of Laws: Both central and state governments must move beyond legislative recognition and operationalize welfare boards and digital infrastructure.
  2. Tripartite Model: Representation of government, platforms, and workers in policy-making.
  3. Algorithmic Accountability: Platforms must ensure transparency in how they assign work and determine pay.
  4. Portable Benefits: Design social security benefits that are portable across platforms and geographies.
  5. Minimum Wage Guarantees: Introduce baseline earnings protection to ensure a decent standard of living.

Conclusion

India is at a crossroads in addressing the rights of gig and platform workers. The legislative efforts in states like Rajasthan, Karnataka, and Telangana are commendable first steps. However, genuine transformation will require coordinated implementation, technological innovation, and ongoing dialogue between stakeholders. As the gig economy continues to grow, ensuring its inclusivity and fairness is not just an economic imperative, but a moral one.

Sources:

  1. THE HINDU newspaper of 16th May 2025 – “Gig workers meeting demands minimum wages, social security” page 16
  2. https://indianexpress.com/article/cities/bangalore/karnataka-cabinet-gig-workers-welfare-bill-cess-on-platforms-9939108/?utm_
  3. https://www.newindianexpress.com/states/telangana/2025/May/12/telangana-gig-platform-workers-call-for-stronger-protection-algorithmic-transparency?utm_
  4. https://labour.gov.in/sites/default/files/pib2035286.pdf?utm_

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