Number of Gig & Platform Workers in India

Number of Gig & Platform Workers in India

The Indian government has projected that the number of gig workers and platform workers in the country will reach 23.5 million by 2029-30. This highlights the significant growth and employment potential of the gig economy in India.

What Are Gig Workers?

• Gig Workers are individuals engaged in temporary, flexible, or freelance jobs, often facilitated through online platforms.

• Unlike traditional, full-time employment, gig workers take up short-term assignments or projects on demand.

• The gig economy is characterized by freelance, on-demand, and short-term work arrangements. This economy has been growing rapidly due to the widespread use of digital platforms and technologies.

Gig Economy in India:

1. Current Statistics:

   • As per NITI Aayog’s report "India’s Booming Gig and Platform Economy" (2022), India had approximately 7.7 million gig and platform workers in 2020-21.

   • India has emerged as one of the world’s largest countries for gig work, driven by the proliferation of e-commerce platforms, app-based services, and online marketplaces.

2. Growth Prospects:

   • The gig economy is expected to grow substantially, with the number of gig and platform workers projected to reach 23.5 million by 2029-30.

3. Significance of the Gig Economy:

   • The gig economy has provided employment opportunities to millions, especially in urban areas where traditional jobs might be limited.

   • Gig work offers flexibility, the ability to set one’s own schedule, and the opportunity to work across multiple projects, which are attractive features for workers.

Macro and Micro Impacts of the Gig Economy:

1. Macro Impacts (Economic Growth):

   • The gig economy contributes to India’s overall economic growth, creating new forms of work and boosting consumption through flexible labor.

   • With the rise of e-commerce platforms, logistics services, and app-based businesses, millions of jobs have been created.

2. Micro Impacts (Worker’s Perspective):

   • Gig work provides income stability through a diverse range of opportunities.

   • Workers benefit from independence, the freedom to choose work hours, and the ability to earn additional income without being tied to a single employer.

Challenges Faced by Gig Workers:

1. Lack of Legal Protections:

   • Gig workers are not recognized as formal employees, meaning they lack access to traditional labor law protections like health and safety standards, social security benefits, or minimum wage guarantees.

   • Many gig workers feel their workplace conditions are not regulated, and there are no formal contracts protecting their rights.

2. Income Instability:

   • Gig workers face income volatility because of the lack of guaranteed wages, often relying on the number of jobs they secure each month. As a result, job security is minimal.

   • Income instability leads to challenges in long-term financial planning and personal savings for workers.

3. Unregulated Working Hours:

   • Many gig workers, such as app-cab drivers, face unpredictable and extended working hours, including late nights and early mornings.

   • This leads to safety concerns, including the risk of accidents and exploitation due to long working hours.

4. Revenue Sharing and Working Conditions:

   • Gig workers have raised concerns about unfair revenue sharing models, where platforms take a large commission, leaving workers with a minimal share of earnings.

   • Protests have been witnessed over issues such as working hours, workload, and payment structures.

Government Measures:

1. Code on Social Security, 2020:

   • For the first time, the Code on Social Security, 2020 officially recognizes gig workers and platform workers and proposes social security measures for them.

   • These measures include life and disability cover, accident insurance, health and maternity benefits, and old-age protection for gig workers.

2. Regulatory Framework:

   • The government is working to create a supportive regulatory framework to address the challenges faced by gig workers. The goal is to balance the flexibility of gig work with adequate protections for workers’ rights and welfare.

Gig Workers in India: Issues, Proposed Law, and Way Ahead

Overview of Gig Workers

• Gig workers refer to individuals working in non-traditional employment relationships, often in temporary, flexible jobs.

• These workers are classified into two categories:

  • Platform workers: Those who use online platforms or apps (e.g., Uber drivers, food delivery services) to connect with customers.

  • Non-platform workers: These include workers in sectors like construction, or other temporary, non-technology-based jobs (e.g., day laborers, casual workers).

Issues Faced by Gig Workers

Gig workers face several challenges due to their exclusion from the traditional employer-employee relationship. Some key issues include:

1. Lack of Basic Employment Rights:

   • Minimum Wages: Gig workers are not guaranteed minimum wages, unlike formal employees.

   • Overtime Pay: They do not receive overtime pay, even when working beyond standard hours.

   • Medical Leave: Unlike full-time employees, gig workers often do not have access to medical or sick leave.

   • Dispute Resolution: Gig workers do not have access to a statutorily defined mechanism for the resolution of disputes between employers and workers.

2. Classification Issues:

   • The classification of gig workers as ‘employees’ or ‘independent contractors’ depends on the extent of control and supervision exercised by employers.

   • Gig workers exhibit characteristics of both employees (e.g., performing tasks under supervision) and independent contractors (e.g., flexibility in choosing work hours).

   • This hybrid nature causes them to fall outside the purview of many statutory labor benefits such as those under the Minimum Wages Act (1948), EPF Act (1952), and Payment of Bonus Act (1965).

3. Legal Ambiguity:

   • Gig workers are not entitled to the same legal protections as formal employees. They are not covered under labor laws that apply to contract laborers (who are governed by the Contract Labour (Regulation and Abolition) Act, 1970).

   • As a result, gig workers remain vulnerable to exploitation and lack basic legal protections such as health and safety standards, accident insurance, or retirement benefits.

Proposed Law for Gig Workers: The Code on Social Security 2020

In response to the challenges faced by gig workers, the Code on Social Security, 2020 was introduced by the Ministry of Labour and Employment, which includes several provisions specifically for gig workers.

Salient Provisions of the Code on Social Security 2020:

1. Inclusion of Gig Workers:

   • For the first time, gig workers are brought within the ambit of Indian labor laws.

   • The Code distinguishes between gig workers and employees, acknowledging their unique status in the labor market.

2. Social Security Schemes:

   • The Central and State Governments are required to frame suitable social security schemes for gig workers, addressing areas like:

     • Life and disability cover

     • Accident insurance

     • Health and maternity benefits

     • Old-age protection.

3. Social Security Fund:

   • A Social Security Fund for gig workers is proposed, where gig employers must contribute 1-2% of their annual turnover.

   • These funds will be used to finance the social security schemes designed for gig workers.

4. Registration:

   • Compulsory registration of all gig workers is mandated to enable them to avail benefits under these social security schemes.

5. National Social Security Board:

   • A National Social Security Board will be constituted by the Central government to oversee the implementation of these schemes and ensure compliance.

Concerns and Limitations of the Proposed Law

Despite the positive steps taken by the Code on Social Security, several concerns remain:

1. Limited Scope in Labour Codes:

   • Gig work is mentioned only in the Code on Social Security, and the other three labor codes (such as the Industrial Relations Code and the Wages Code) do not recognize gig workers.

   • This limits their ability to form unions, access a national minimum wage, or participate in collective bargaining.

2. Exclusion from ‘Unorganised Workers’ Definition:

   • Gig workers are excluded from being classified as ‘unorganised workers’ under the Unorganised Workers’ Social Security Act, 2008.

   • This exclusion means they do not have access to the specialized grievance redressal mechanisms available to unorganised workers.

3. Lack of Collective Bargaining Rights:

   • Gig workers are excluded from the right to collective bargaining, a key principle of modern labor law. This leaves them at a disadvantage when negotiating wages or working conditions.

4. Potential Violation of Fundamental Rights:

   • By denying gig workers access to basic rights and protections, it can be argued that their fundamental rights under Articles 14 (equality before law) and 21 (right to life and personal liberty) are violated.

   • Gig workers' conditions might even fall under the definition of forced labor as per Article 23 of the Indian Constitution.

Judicial Intervention and Best Practices

1. Judicial Intervention:

   • A petition is pending in the Supreme Court of India seeking to classify gig workers as ‘unorganised workers’, which would place them under the purview of the Unorganised Workers' Social Security Act. This petition aims to address the gaps in legal protection for gig workers.

2. Best Practices from Other Countries:

   • UK: The UK Supreme Court classified Uber drivers as ‘workers’ under the UK Employment Rights Act, 1996, thus granting them the right to employment protections such as minimum wage and holiday pay.

   • Germany: The Temporary Employment Act in Germany ensures equal pay and equal treatment for gig workers.

   • Singapore: Singapore has proposed legislative changes to extend work injury insurance and pension coverage to gig workers.

Way Ahead for India

1. Implementation of Labour Codes:

   • The Labor Codes need to be implemented expeditiously by the Central and State Governments.

   • State governments must frame rules for the effective implementation of the provisions, especially those related to gig workers.

2. Addressing Gaps in Legal Protections:

   • Future reforms should aim to provide gig workers with access to social security, minimum wage guarantees, and protection from exploitation.

   • Policies should also ensure that gig workers are entitled to collective bargaining rights and legal recognition to improve their working conditions.

By strengthening labor laws and creating a comprehensive regulatory framework, India can unlock the full potential of its gig economy while ensuring fair treatment and protection for gig workers.