Feb 14, 2022

The Law for Gig-Workers in India

Malavika Rajkumar

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Source: Financial Express


Who are gig workers?

Gig workers refer to the workers outside of the traditional employer-employee relationship including freelancers, workers who are employed on a contractual basis with their employers, project based work and short term work. Most commonly, platform based work where workers earn money by providing specific services, including food delivery services like Zomato, Swiggy or e-commerce platforms such as Amazon, Flipkart etc., use gig workers. A 2017 Ernst and Young study on the “Future of Jobs in India” even found that 24% of the world’s gig workers come from India.

The gig economy allows different people across cities, age groups, and skill sets to pick up work without being tied down to one single project. Those just entering the workforce find it easier to find gig work than conventional jobs that need some amount of work experience.


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Source: Trak India


The advent of the gig economy in the country has had a major impact on the country’s labour market. Financial volatility and lack of labour protections are some of the consequences of working as a gig worker.


Are there laws protecting gig workers?

Gig work, being a relatively new form of workforce engagement, still remains untested in Indian Courts, and with the absence of specific legislations, gig workers cannot claim consequential benefits such as minimum wages, hours of work, overtime, leave, etc. as compared to most traditional long-term employees. This is because the current labour laws in place do not encompass the nature of work done by gig workers.

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Source: wonolo.com


Currently, Indian labour and employment laws recognize three main categories of employees: government employees, employees in government-controlled corporate bodies known as Public Sector Undertakings (PSUs) and private sector employees who may be managerial staff or workmen. All these employees are ensured certain working conditions, such as minimum wages under The Minimum Wages Act, 1948, a set number of hours of work, compensation for termination, etc. Currently, gig workers lack the ‘employee’ status under Indian law, thereby resulting in several consequences, such as an inability to form unions to represent their interests, exploitative contacts, etc.


Gig workers under the ambit of Contract Labour Act

The Contract Labour (Regulation and Abolition) Act, 1970 regulates engagement of contract labour in India, including work done through third-party contractors. There is scope for gig workers who work for platforms to be “contractors” under this law. This imposes obligations on employers to comply with the requirements under this law, including welfare and health obligations to be provided to employees such as the provision of canteens, first aid, etc. Yet, this law has still not been applied by most platforms nor has it been discussed by any Indian Court.

The Employment Compensation Act, 1923 mandates that the employer pay compensation for accidents arising out of and in the course of employment. The applicability of this law to gig workers also remains to be determined by Courts. If this does apply to gig workers, it would go a long way in ensuring compensation for occupational safety hazards.


Gig work under the new Labour Codes

The new Labour Codes of 2019 defines a gig worker as “A person who performs work or participates in a work arrangement and earns from such activities outside of traditional employer-employee relationship”.


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Source: sandiegouniontribune


Even though gig workers will get protections such as minimum wages, crucial protections related to occupational health and safety still remain to be addressed. Once the current draft Code becomes a law, gig workers would get schemes which are notified by the State and Central Government, including life and disability cover.

While gig work has become a necessity for both the workers and the platforms hiring them, regulation of the gig work remains vital to ensure that these classes of workers are given the same opportunities and protections as other employees covered under various labour laws in India. Labour disputes will continue to increase manifold and assume new shapes and forms with the advent of technology. Proposing legislative tools and policy frameworks as well as a review of the draft Code is essential in ensuring the protection of rights of gig workers.


Malavika Rajkumar is the Content Lead, Nyaaya an initiative of Vidhi Centre for Legal Policy, New Delhi. Views are personal.

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