Karnataka Gig Workers Bill: On June 29, the Karnataka government released a draft of the Karnataka Platform-based Gig Workers (Social Security and Welfare) Bill. This made Karnataka the second state in India, after Rajasthan, to take such an initiative. The bill aims to improve the welfare and social security of gig workers, who are an essential part of India’s growing gig economy.
What is Gig?
A gig economy is a system where companies hire workers for short-term contracts rather than permanent jobs. In simple terms, the work is temporary and is done to meet the company’s immediate needs. Many startups like Ola, Uber, Zomato, and Swiggy have played a significant role in developing this gig economy in India, offering a wide range of temporary jobs.
Gig workers are those who earn from work or activities that do not involve the traditional employer-employee relationship. They can be independent contractors, platform-based workers, on-call workers, or temporary workers. In India, the gig economy is growing rapidly, and gig workers are contributing significantly to the workforce.
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India’s Gig Economy
According to a study by NITI Aayog, about 47% of gig work in India is in medium-skilled jobs, 22% is in high-skilled jobs, and 31% is in low-skilled jobs. This shows how diverse the gig economy is and how important it is for the country’s economy. Research by the Boston Consulting Group has also shown that participation in the gig economy is higher in developing countries like India compared to developed nations.
As of 2020-21, about 77 lakh people were working in the gig economy, and by 2029-30, this number is expected to rise to 2.35 crore. Most of these workers are engaged in low-income job sectors like deliveries, ridesharing, microtasks, and care services.
The median age of gig workers in India is 27, and they typically earn around Rs 18,000 per month. Many these workers are the primary earners for their families, and they usually have families with an average size of 4.4 members.
Despite the growth of the gig economy, workers in this sector face many challenges. Even though companies like Swiggy, Zomato, Ola, and Uber have created job opportunities, these workers often struggle with low wages, gender inequality, and limited chances for career growth.
The fact that gig workers are hired on a contractual basis rather than as permanent employees means they do not receive benefits such as paid sick leave, travel allowances, or a provident fund, which are usually given to regular employees.
Gig Workers’ Benefits and Improvements
To improve the lives of gig workers, there are several steps that need to be taken. One important measure is providing fiscal incentives, such as tax breaks or startup grants, for businesses that employ a significant number of women.
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Platforms will be required to deduct a percentage of payments made to workers and deposit it with the Employees’ Pension Scheme. The government may also contribute an additional 3-4%. This measure, part of the labour codes enacted years ago but not yet implemented due to state-level delays, aims to simplify the process for gig workers working across multiple platforms. “We are working out the details and we hope to operationalise it soon,” a senior labour ministry official told TOI
Another important step is offering retirement benefits, including old-age plans, and other forms of insurance, especially for workers who face uncertain or irregular work patterns. These benefits should be included under the Code on Social Security, 2020, which is designed to protect the social security of gig workers.
Providing income support to workers, especially during times of job uncertainty, would also be a crucial step in improving their living conditions. Paid sick leave and insurance coverage for events like the Covid-19 pandemic should be offered as well.
Rajasthan, the first state to act in this area, passed the Rajasthan Platform Based Gig Workers (Registration and Welfare) Act 2023. Under this act, a board will be established to ensure that gig workers are registered and have access to welfare programs.
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This board will also help address the issues and challenges that gig workers face by providing a platform for collective bargaining and negotiations. The act includes a provision for creating a social security fund, which will be funded by a fee on each transaction made by gig workers. This fund will help improve the workers’ welfare and social security.
