Aggregators May Have To Contribute 2% Of Gig Workers’ Earnings For Pension Scheme

In a move to boost the welfare of gig workers, the government is reportedly planning to introduce a pension scheme requiring platform aggregators to contribute 2% of each worker’s income.

As per a Business Standard report, all major platform aggregators such as Swiggy, Zomato, Binkit and Uber may be asked to make the contribution to the pension fund. 

Under the scheme which may be revealed in the next two-three weeks, the pension amount will be deposited into the Employee Provident Fund Organisation (EPFO) accounts of the gig workers. 

“This amount will not be inclusive of their incomes. It will be over and above that. A platform aggregator will collect the amount and deposit it with the EPFO into the account of the worker. We hope the scheme will be unveiled in the next two-three weeks,” a source told BS. 

Finance minister Nirmala Sitharaman announced a comprehensive social security scheme for gig workers in Budget 2025. The initiative by the labour and employment ministry, is expected to benefit nearly 1 Cr gig workers by providing essential health insurance, as well as death and disability cover, potentially rolling out from the next financial year.

Centre’s Move For Gig Workers’ Social Security

To strengthen the social welfare framework for gig workers, the government is prioritising workers’ formal registration through ID cards and enrollment on the e-Shram portal. The e-Shram portal was launched in August 2021 to register workers in unorganised sectors by issuing them with a Universal Account Number (UAN). 

“Gig workers of online platforms provide great dynamism to the new-age services economy. Recognising their contribution, our government will arrange for their identity cards and registration on the e-Shram portal,” finance minister Nirmala Sitharaman said in her Budget 2025 speech.

After FM’s announcement, the labour ministry is planning to seek the Union Cabinet’s nod for the pension scheme. It was reported last month that gig workers will be provided two options at the time of retirement when the pension is fixed – either withdraw interest on the deposits as pension or divide the accumulated funds into equal installments over a stipulated period.

A new socio-economic upliftment initiative for urban workers is also in the pipeline, further amplifying financial opportunities through enhanced loan schemes under PM Swanidhi.

The Need For Gig Workers Welfare Scheme 

Last year, ride-hailing companies Ola and Uber and logistics startup Porter scored zero points on Fairwork India’s ratings for the working conditions of gig workers. 

It evaluated 11 digital platforms on five principles – fair pay, fair conditions, fair contracts, fair management, fair representation.

The report underscored that the aggregator platforms do not have documented mechanisms enabling collective expression of the “voices of all workers, ensure that workers’ freedom of association is not inhibited, and have a written statement of willingness to recognise or negotiate with a collective, independent body of workers.” 

It also stressed that none of the digital players pay minimum wages enough to allow workers to afford a basic but decent standard of living. 

Notably, BigBasket, Swiggy, Zomato, and Urban Company were the top scorers in the fireworks rating.

As per NITI Aayog, India’s gig workforce is expected to expand to 2.35 Cr (23.5 Mn) workers by 2029-30.