The gig economy has transformed work options in India, with prominent online
platforms like Ola and Uber paying drivers a living salary and giving incentives
that allow some to make up to Rs. 90,000 per month. However, poor pay structures
and antiquated labour rules have sparked countrywide demonstrations by drivers
saddled with vehicle and smartphone debts. The app's strictness and the ranking
system merely add to the difficulties these workers encounter. Unfortunately,
the COVID-19 epidemic has exacerbated the situation.
In response to these concerns, the Indian government developed the Code on
Social Security 2020, a significant piece of legislation that aims to address
these concerns. It establishes distinct definitions and welfare programmes for
gig, platform, and unorganised sector employees, which is a game-changing
alteration in how these workers are protected. This streamlines the procedure of
obtaining social security benefits for these employees .
However, there are worries regarding overlapping definitions of gig and platform
workers, as well as the registration procedure not being sufficiently inclusive.
Furthermore, limiting benefits for these employees may lead to online platforms
implementing stricter work schedules in order to preserve profitability, which
may impair the freedom enjoyed by gig workers. This might result in changes to
employment methods, wage structures, and strict minimum working hours.
It is critical to address these concerns and develop a solution that secures a
fair and inclusive future for India's gig and platform employees. With the gig
economy thriving, the government must continue to develop and strengthen the
Code on Social Security 2020 to guarantee that these employees receive the
security and benefits they deserve.
Are Cab Drivers Employed By Multinational Ride-Sharing Companies Considered
"Workmen" As Per The Definition Laid Out In Section 2(S) Of The Industrial
Disputes Act, 1947?
The development of concerns about bad working conditions and low salaries, as
well as a lack of social security provisions, caused a heated discussion in
India between taxi drivers and the owners of global ride-sharing firms. The
primary topic was whether taxi drivers came within the typical employer-employee
relationship, with the essential question being, "Are cab drivers 'workmen'
under section 2(s) of the Industrial Dispute Act, 1947?" Initially, the
corporations were cautious to identify them as workers since doing so would
obligate them to give security benefits and other work-related rights under
However, as various case laws illustrate, despite the hybrid
nature of employment, taxi drivers employed by these businesses are considered
as employees rather than being barred from the scope of labour laws.
When evaluating whether taxi drivers qualify as "workmen" under section 2(s) of
the Industrial Disputes Act of 1947, Indian courts have used a comprehensive
approach. They examined two critical elements: worker characteristics and the
form of the contract between employers (ride-sharing businesses) and cab
drivers. This assessment assesses whether taxi drivers are "independent
contractors" or "employees" under the authority and supervision of their
Workman is defined under the Act as any individual engaged in an industry to
perform manual, unskilled, skilled, technical, operational, clerical, or
supervisory work for pay or compensation. The section also specifies certain
types of employment, such as police work, military service, and those in
management or administrative roles . It does not, however, specifically include
gig workers or other comparable employment arrangements.
Although taxi drivers are not expressly excluded from the Act's provisions,
their categorization as workers is dependent on how the Act's language is
interpreted. Because gig labour is a newer type of employment, its legal
analysis cannot be based exclusively on a literal interpretation of the clause.
In the landmark case of Dharangadhara Chemical Works v. State of Saurashtra,
The Supreme Court distinguished between "independent contractors" and "workmen."
The court determined that, although an independent contractor agrees to execute
the work himself, a workman agrees to hire others to accomplish the work. This
decision applies to taxi drivers since contractual restrictions prevent them
from hiring someone else to drive on their behalf, just as a worker is
contractually bound to complete the task themselves.
Similarly, in the case of Management of DC Dewan Mohideen Sahib v Janab S. Ahmen
Hussain and Sons, The court considered the aspect of independence and
differentiated between actual and illusory independence. To be really
independent, independent contractors must have control over how their operations
are carried out. However, in the case of Uber and other ride-sharing firms,
drivers must have specified abilities and documentation in order to be
registered, demonstrating their lack of total control over their employment.
In the case of Workmen of Nilgiri Cooperative Society Ltd. v. State of Tamil
Nadu, The Integration test was developed to examine if a person is integrated
into or independent of the employer's concern. The appointing authority,
paymaster, control and supervision, alternative service, kind of job, and
establishment are all aspects considered by the test. When we apply this test to
the interaction between cab drivers and ride-sharing businesses, we can see that
these corporations have a lot of power over the drivers.
For example, they
employ a ranking system to evaluate drivers, and drivers who earn negative
ratings may lose access to the app entirely. This effectively implies that the
firms have the authority to fire or dismiss drivers. Furthermore, if a customer
registers a complaint via the app, the corporation can take action against the
driver, including terminating their contract. As a result, it is clear that the
firms have significant power over the drivers, and they may be called
"integrated" into the companies' concerns.
Following an examination of several instances, it was determined that cab
drivers in the gig economy are not independent contractors, but rather
"workers." Although they may appear to be independent, this is really an
illusion because the global corporations that hire them have ultimate control,
monitoring, and firing authority.
Despite the fact that the gig economy did not
exist when the Industrial Disputes Act was enacted, taxi drivers' working
conditions should not deprive them of the rights and benefits that come with
being classed as workers under various labour laws. As a result, we can confirm
that Hypothesis (1) is correct.
Does The Code On Social Security 2020 Offer Enough Safeguards To Guarantee The Proper Implementation Of Social Security Benefits And Other Rights For Gig Workers In The Indian Economy?
The Code on Social Security, 2020, has ushered in a new age of social security
measures, particularly for the unorganised industries, by combining and
replacing nine existing statutes that offered social security benefits to
employees. The Code has included fresh ideas such as gig workers, platform
workers, and fixed-term employees, as well as increased coverage of workers in
both organised and unorganised industries. The Code has eliminated worker
segregation by combining various social security benefits formerly separated
under distinct statutes, resulting in a unified framework and equitable
treatment in terms of benefits provided under different schemes.
The Code's Chapter IX focuses on social security measures for employees in the
gig, platform, and unorganised sectors. This chapter provides applicable social
security programmes for platform and gig workers, such as life and disability
insurance, accident coverage, maternity and health benefits, old-age protection,
childcare facilities, and any other benefit defined by the Central Government .
By doing so, the Code offers social security to these employees while also
encouraging confidence and trust in new and expanding job opportunities in the
Regulatory Hurdles Faced By Gig Workers Under The Code On Social Security, 2020
Gig Workers, Platform Workers, And Unorganized Sector Workers: Overlapping A gig worker is defined as an individual who takes up employment or engages in a work arrangement outside of the usual employer-employee relationship and earns money from such activities on a part-time or hourly basis under Section 2(35) of the Code on Social Security, 2020. This sort of work is often finished in a set amount of time and is not constrained by a standard work arrangement.
While the word is new in India, it is comparable to platform employees, who work for service providers such as ride-sharing businesses like Uber. Part-time academics, freelancers, and independent contractors are examples of gig workers. It is important to note that a person can be both a gig worker and a platform worker at the same time, such as a college student who works part-time as a driver for a ride-sharing firm.
Because these organisations do not have a set working hour schedule, gig workers can supplement their income through various job arrangements, making it a flexible and adaptable choice for people looking for work.
Sections 2(60) and 2(61) of the Code on Social Security, 2020 define platform work and platform worker as work arrangements that operate outside of the traditional employer-employee relationship and are facilitated by online platforms for specific services or problem-solving in exchange for payment.
Surprisingly, the definition of gig worker in Section 2(35) includes the same element of a non-traditional working connection. However, the Code does not define the link between these classifications, and the term of unorganized worker in Section 2(86), which includes all of these individuals, adds to the confusion. As a result, it is unclear how the various social security plans would apply to each job group and whether separate schemes will be required. This uncertainty complicates the procedure of obtaining social security benefits.
When it comes to the status of gig workers and platform employees, the Code on Social Security, 2020 has left various grey areas, leading to doubt over their eligibility for benefits. There is no agreement on whether a worker may be categorised as a gig worker, a platform worker, or an unorganised worker. Because of the lack of precision in the criteria, employees may be able to claim several benefits while others may not have the same advantage.
This might lead to the provisions being abused, resulting in further issues.
The Standing Committee on Labour had recommended several changes, including a broader definition of unorganised workers to include gig and platform workers, and clearer definitions of gig workers to prevent misinterpretation. However, the Code has not addressed these recommendations, leaving many questions unanswered.
The Issue Of Dual Authorities: Central Versus State Government The 2020 Code on Social Security sought to streamline the process of delivering social security measures to workers in the unorganised sector. The split of power between state and central administrations, on the other hand, has complicated matters. Sections 109(1) and 109(2) of the Code allocate separate sets of social security measures to both authorities, complicating the implementation process.
A easier alternative would have been to delegate responsibility for implementing social security measures to state governments, with the federal government picking up a share of the tab . Section 109(3) also permits payments to the social security fund from a variety of sources, including state governments, aggregators, corporate social responsibility programs, and others.
It is paradoxical to have two different social security funds under Section 141 because both authorities and other sources can contribute to the same fund. A single fund would have been far more easy.
Instead of introducing extra layers of complexity, the Code should try to make the process of providing social security more accessible and efficient.
We must strive for a future in which social security benefits are freely available to all unorganized sector workers and the well-being of the most vulnerable is prioritized.
The Code on Social Security, 2020 may have provided a glimmer of hope for unorganised sector workers, but its implementation has revealed a few legal gaps that must be addressed by the relevant authorities.
The issue of dual authorities is a matter of concern and requires a prompt resolution between the central and state governments. Despite these challenges, there is an opportunity for the legal community and lawmakers to refine and evolve the Code to better serve the needs of the unorganised workforce. Thus, hypothesis (2) has been affirmed.
- To safeguard the financial security of gig workers, lawmakers should consider including a separate section in the Code that establishes a minimum salary floor. This will prevent the contribution from their yearly turnover from having a negative impact on their earnings.
- To minimise conflicts and ensure the Code's efficient implementation, the federal and state governments should collaborate to create a uniform ratio for their respective payments to the Social Security Fund. It is also critical to define their implementing authority's unique jurisdiction.
- To preserve the privacy of gig workers, obligatory Aadhar registration should be reduced. This will prohibit commercial corporations from accessing their personal information and potentially infringing their fundamental rights under Articles 19 and 21.
- To guarantee that gig workers are well-informed and registered, state governments should take responsibility for effective information transmission. This may be accomplished through Panchayats, Ration stores, and other viable local entities.
- More feedback from gig workers is needed to strengthen the Social Security Code. Their thoughts and insights will be used to improve the Code so that it better meets their requirements.
- Companies should set up grievance bureaus that are easily available to gig employees. This will give a forum for employees to address issues such as the exorbitant commission rates imposed by platform providers, as well as ensuring that their complaints are heard and addressed.
- The ability to unionise for a shared cause and engage in collective bargaining are both essential rights for gig workers. Including gig workers in the notion of collective bargaining will provide them more negotiating leverage and guarantee that their interests and rights are recognised.
The Indian platform economy has seen a huge increase in job prospects as the
globe progresses towards digitalization and entrepreneurship, luring more gig
workers to the market. The Code on Social Security, 2020 represents a
significant advancement in labour laws by consolidating several restrictions and
extending its application to newer industries like gig employment. Although this
is a laudable accomplishment, there are certain critical difficulties that must
be resolved to guarantee the prompt and effective administration of justice to
Gig workers have been forced to shoulder the burden of increased gasoline
prices, car maintenance, and insurance expenses while the Covid-19 epidemic
rages on, which has had an impact on their pay. These employees, who have long
struggled for their rights across the nation, have high expectations after the
Code. The law-making organisations and judicial authorities must revise the Code
as needed before making it widely applicable in order to address these
The execution of social security payments can be improved by closing the gaps
created by comparable problems encountered by gig workers in the United States
and the United Kingdom. Additionally, there is a need to restructure the Aadhar
card registration requirement and create conveniently accessible grievance
offices so that employees may voice their concerns. Gig workers should also be
given access to collective bargaining rights so they may form a union and
advocate for a shared goal.
Despite these difficulties, the Code marks a substantial advancement in
protecting the rights and interests of gig workers. It is a positive step
towards providing social security and welfare for a segment of the workforce
that is continually expanding.