Why in the News?
Major delivery aggregators have agreed to remove the 10-minute delivery service deadline.
About Gig Workers
- Definition: The Code on Social Security, 2020 for the first time provided the definition of gig and platform workers as:
- Gig Worker: Person who performs work or participates in a work arrangement and earns from such activities outside of traditional employer-employee relationship.
- Platform Workers: Person engaged in or undertaking platform work.
- Platform work being a work arrangement where organisations/individuals use an online platform to access other organisations/individuals to solve specific problems or to provide specific services.
- The Code on Social Security 2020 for the first time empowers Government to formulate schemes for providing social security benefits to unorganised workers, gig workers and platform workers.
- They were earlier considered part of informal/unorganised sector with no recognition under Payment of Wages Act (1936), Minimum Wages Act (1948), EPF Act, or ESI Act, etc.
- Key Reasons for Rise of Gig Work: Structural transformations driven by digitalisation, green energy transition in labour market has become the key reason for their emergence.
- Gig economy, encompassing delivery, ridesharing, and freelancing, has witnessed structural growth, transitioning informal jobs into ecosystem-integrated roles.
- Status: Represent over 2% of total workforce in India. (Economic Survey 2025-26).
- From 77 lakh workers in FY21 to 120 lakh workers in FY25, the sector has witnessed a 55% increase driven by smartphone penetration among 80 crore users and 15 billion UPI transactions per month.
- Rising Trends: As per NITI Aayog, gig workforce is expected to expand to 2.35 crore by 2029-30.
Key Issues faced by Gig Workers
- Algorithmic Asymmetry: Platform algorithms control work allocation, performance monitoring, wages, and supply-demand matching, raising concerns about algorithmic biases.
- Platform aggregators have broad access to workers' information while workers do not have access to algorithms creating information asymmetry.
- Income and Job Uncertainty: Sector is heavily reliant on market demand with about 40% of gig workers reporting earnings below ₹15,000 per month (Economic Survey 2025-26).
- Further they also face low financial inclusion causing challenges in accessing credit or have thin-file credit access.
- Lack of Collective Bargaining Power: Due to gig economy being a recent and emergent phenomena and lack of employer-employee relationship, traditional concept of collective bargaining has not fully matured.
- Limited Skilling: Fears of job losses due to technological advances such as Artificial Intelligence (AI) and Machine Learning (ML) add to worker vulnerability.
- Lack of Suitable Classification: While the law recognises gig and platform workers as a distinct category, it treats them as a largely homogeneous group, which are highly segmented by skill.
Global Regulations Concerning Gig economy
|
- Others: Mental and Health Concerns due to irregular schedules, gender specific concerns due to lack of digital literacy and wage gaps within platforms, etc.
Initiatives taken for the Welfare of Gig Workers
- Code on Social Security (2020):
- Welfare/Social Security Fund: It mandates aggregators to contribute 1-2% of their annual turnover (capped at 5% of payments made or payable to gig/platform workers) to fund life/health insurance, and pensions for gig workers.
- National Social Security Board: Advises Government on formulating and monitoring suitable schemes.
- Similar provision for State Unorganised Workers Social Security Board.
- Portability of Benefits: Unique Aadhaar-linked ID generated through registration on e-Shram portal, allowing gig workers' social security benefits to be portable across platforms.
- e-Shram portal is meant to register and support unorganised workers by providing them a Universal Account Number (UAN) on a self-declaration basis.
- Grievance Redressal: Toll-free helpline, call centre, or facilitation centre for timely support.
- Social Security Schemes: Life insurance, disability insurance, health, maternity, and pension benefits, etc.
- Union Budget 2025-26: Providing healthcare under PM Jan Arogya Yojana (PMJAY), likely to assist nearly 1 crore gig-workers.
- 12 major aggregators, namely Zomato, Blinkit, Urban Company, Uber, Amazon, Ola, Swiggy, etc., have been onboarded to the Ayushman Bharat – PMJAY benefits.
- State-level Initiatives: Rajasthan Platform Based Gig Workers (Registration And Welfare) Act, 2023; Karnataka Platform based Gig Workers (Social Security and Welfare) Bill, 2024; etc.
Ways to address challenges faced by Gig Workers
- Expediate Implementation of Social Security Code: Across all states/UTs along with strengthening administrative readiness, creating a gender disaggregated database of unorganized, gig and platform workers, and intensifying awareness (Parliamentary Committee Report on Empowerment of Women).
- Strengthen Social Security Coverage: Tailored schemes, wider e-Shram registration, regular monitoring of fund use and wider healthcare delivery.
- Estimating the size of Gig Economy: During enumerations (census, PLFS, NSS or otherwise), different occupations of an individuals may be captured including gig work status.
- Algorithmic Accountability and Fair Task Allocation: Easy access to data, including money received, any deductions, ratings, with the workers.
- Financial Planning Support: Access to low-cost emergency savings schemes, portable social security benefits; budgeting and financial literacy programmes.
- Others: Transparent policy concerning terms of services, inclusive social dialogue, right to collective bargaining and unionization; etc.
Conclusion
Operationalizing the Code on Social Security could adopt five-pronged RAISE approach by Recognising varied nature of work; Augmenting Social Security; Incorporating interests of platforms and workers; Support Welfare programmes; Ensure accessibility of benefits.
