The Internet and Mobile Association of India and the National Association of Software and Service Companies (Nasscom) have requested the Karnataka government to put on hold its proposed legislation for gig workers to facilitate further consultation. Clearly, 10 days is too short a time for meaningful discussions on what is an important law and the Karnataka government must extend the deadline. The Karnataka Platform-Based Gig Workers (Social Security and Welfare) Bill is an attempt to protect the rights and benefits of gig workers by building a social security net for them. The Bill proposes a parallel social security structure for gig workers, similar to the Central law — Code on Social Security, 2020. Broadly, it’s an attempt to give gig workers more benefits and provide them recourse to a grievance redress mechanism. The government also wants to protect workers from arbitrary termination of their services and has suggested a minimum notice period.
It is not surprising that platforms are uncomfortable with the thought of formalising the employment of gig workers. As they have argued in the past, this doesn’t fit into their business models. Enrolling the teams of delivery boys, they say, would drive up costs and make their businesses less profitable or even unviable. The proposed legislation undoubtedly increases the regulatory and compliance burden for platforms. It is also intrusive. Nascomm has pointed out that powers to the state government to inspect, monitor, and track the operations including algorithms, contracts, and day-to-day functioning, would go against the ease of doing business.
The question is whether gig platforms should be allowed privileges that other companies, across industries, do not enjoy. All companies take on the responsibility and financial burden of providing for their employees. It is essentially to avoid shouldering these responsibilities — especially financial ones — that platforms do not employ gig workers but treat them as simply “partners”. Nascomm asserts that gig workers are independent contractors and not employees; as such, the terms and conditions laid out in the Bill, they believe, are incompatible with rules applicable to other companies. The Karnataka government’s approach, while well-intentioned, comes across as somewhat high-handed. For one thing, fixing criminal liability on officers and directors is not desirable. Moreover, the idea of collecting funds from platforms to be spent on social security schemes smacks of coercion. Also, there is no transparent mechanism suggested to ensure that the money will be spent only on the workers. It is true that in some overseas jurisdictions, the law has been framed in favour of workers.
It is equally true that gig workers do get a raw deal both in terms of working conditions, hours, and remuneration. There is no doubt that they can’t be deprived of basic rights. Challenging work conditions, arbitrary dismissals, reduced or inconsistent salaries, and minimal negotiation rights are features of today’s gig economy. While the platforms understandably may not want to formally enrol the workers — and provide benefits like a provident fund contribution — they must increase the pay and other benefits such as insurance. A common set of financial benefits — much like a minimum wage indexed to inflation — must be put out upfront with some legal sanctity. Gig workers are expected to constitute 4.1% of India’s total workforce by the financial year 2029-30 and need some regulatory shield. It’s nobody’s case to suggest that such a large number of our workforce should be left to the wolves.