Provide Social Security Benefits To Gig Workers: Labour Ministry To Ola, Uber, Zomato

At a time when quick-commerce platform Blinkit’s driver partners are on strike, the Centre is reportedly holding discussions with new-age tech platforms to institute social security benefits for gig workers of these firms.

As per The Times of India, the Labour Ministry held talks with startups such as Ola, Uber, Zomato, Swiggy and Urban Company, which operate within the confines of the gig economy, to provide benefits such as life insurance, personal accident and health covers to their workers.

However, the talks are still underway and the matter is yet to be resolved. The ministry is of the view that the cost factor will not be significant for such companies as the benefits entail group covers which cost less.  

The development comes as the Centre looks to notify four labour codes which have been in limbo for the past many years. The delay has largely been on account of the upcoming 2024 Parliamentary polls and opposition ruled states not yet formulating the norms. 

The four norms – Code on Social Security, 2020, Code on Wages, 2019, Industrial Relation Code, 2020, and Occupational Safety, Health, and Working Conditions Code, 2020 – were enacted by the union government over the course of 2019 and 2022 and seeked to replace existing 29 labour laws. 

Among these, the Code on Social Security envisages providing a slew of social security benefits to gig workers including life and disability cover, accident insurance, health and maternity benefits, old age protection, among others. The code also mandates the creation of a social security fund via contributions from these aggregator platforms. 

The development comes a week after the delivery executives of Zomato’s quick-commerce arm Blinkit in Delhi-NCR went on a strike, demanding a minimum pay of INR 25 per order delivered, better working conditions and restoration of earlier incentive slabs. The protest crippled Blinkit’s operations as more than 100 of its dark stores were shut in the region.

Gig Economy In Focus

The Centre is looking to introduce the new mandates for these aggregator platforms amid a spurt in protests by gig workers demanding better salaries and working conditions. Gig workers across the board have rued the lack of social security benefits at these platforms as the former are not considered full-time employees on the rolls of the firms. 

As such, the companies are not mandated to ensure social security benefits which they are otherwise entitled to at a full-time job. While many of these platforms have piloted health covers for their delivery workers, most of them are yet to institute any such reforms. 

This has resulted in gig workers across companies protesting for better salaries and working conditions. The protests have taken place across the country from Ladakh to Tamil Nadu and from Gujarat to Assam. Multiple incidents involving the death of gig workers on-duty have also raised eyebrows. While most of these players act only only after the incident, the lack of social safety net has caused discontent among the workers. 

This was also visible in the Fairwork India report last year which noted that aggregator platforms such as Ola, Uber, and Dunzo were some of the worst performers on the gig workers’ index.

Meanwhile, states have been working on their own set of rules to bring gig workers under the safety net. Earlier this year, the Rajasthan government approved setting up of an INR 200 Cr welfare fund and the enactment of the Gig Workers Welfare Act. The new policy aims to provide financial assistance to gig workers with certain caveats. 

Backing the demand of workers, government think tank NITI Aayog also urged the platforms to extend social security benefits such as paid sick leave, insurance and healthcare to all gig workers. 

The Indian gig economy has grown manifold in the past few years as more and more workers opt for such jobs part-time or even full-time. This has led to a boom in the gig sector which is projected to grow to $455 Bn by 2024. NITI Aayog estimates that the number of gig workers in the country could surge to 23.5 Mn by FY30.