A new deal to protect India’s gig workers?
Rajasthan announced that the state will enact a law for the protection of gig workers. Why is this necessary? Because, at present, gig work exists in a legal vacuum.
Last month, as part of its budget for 2023-24, Rajasthan announced that the state will enact a law for the protection of gig workers, establish a welfare board, and devote ₹200 crore for this purpose. At the core of the proposed law is the idea that platform companies — such as Uber, Ola, Swiggy, and others — will be required to pay a certain levy, that is a fixed percentage of the cost of each piece of gig work (such as a ride or a delivery). This money will be used for welfare provisions such as accident insurance, pensions, and provident funds for gig workers. It will be administered by a welfare board, which — if labour demands are fulfilled — will have representatives of the government, platform companies and gig workers.
Why is this necessary? At present, gig work exists in a legal vacuum. Labour laws across the world — and in India — have certain threshold requirements for bringing workers within their ambit. For example, there must exist an “employment relationship” between the company and the worker. This concept was shaped in the 20th century, with the model being that of the factory. It required, for example, regularity of work, work for a single employer, at a specific location, with specific machinery, and so on.
In the 21st century, however, this is no longer the dominant paradigm of work. In gig work, for example, workers often switch between different companies, are required to use their own equipment (or loan it from the company), and — quite disingenuously — are referred to as partners instead of employees by the company, precisely to bypass the protections that labour law offers.
However, while gig work does not resemble the employment relationship of the factory owner and the worker, it exhibits all the hallmarks of institutionalised power differences and subordination that make labour laws important in the first place. At the heart of the relationship between the platform company and the worker is the app, through which the platform gatekeeps who can access work and who can’t. It also exerts discipline and control over workers, for example, by setting fares through an opaque and non-transparent algorithm, imposing a rating system (that, in turn, can be affected by consumer bias), and unilaterally altering the terms and conditions of work.
For these reasons, courts and legislatures across the world have increasingly rejected gig companies’ facile characterisation of their workers as partners, with whom they have an equal contract. Courts and legislatures have recognised that in all relevant respects, gig companies exercise far-reaching control over their workers, and the mere ability to switch between different bosses (within the same overall context of work) does not make gig workers independent contractors in any genuine sense; and, therefore, they need the protection of labour laws as much as employees in the more traditional or classical sense.
In India, this issue is yet to be litigated before the courts. While attempts have been made to ensure welfare measures for gig workers through public interest litigation, it is obvious that welfare cannot be judicially enforced; and furthermore, the question of whether gig workers are employees instead of independent contractors — and, therefore, come within the ambit of labour law — is still undecided. The 2020 central labour code gestured towards some minimal form of social security for workers, but it is yet to be enforced.
In this context, Rajasthan’s proposed gig workers’ law, the welfare board, and the budgeting of ₹200 crore is an important first step towards recognising the rights and dignity of gig workers. However, it is only a first step: There is a panoply of rights that come with the employment relationship that are not limited to welfare measures, but are about empowerment (examples include the right to strike and the right to raise an industrial dispute against arbitrary dismissal), and about mitigating the difference in power between the company and the workers. Thus, what is needed is more detailed and comprehensive legislation that frames the issue not only in terms of social welfare, but also in the language of workers’ rights. It remains to be seen whether Rajasthan’s proposed law can serve as a foundation for that.
Gautam Bhatia is a Delhi-based advocate
The views expressed are personal