Out of coverage: Labour Codes must ensure basic rights to gig and platform workers

gig and platform workers and labour codes
The need of the hour is a socio-legal acknowledgement of the work done by gig and platform workers and the ascription of accountability to state and platform companies towards ensuring labour rights.

The emergence of the gig and platform economy is one of the most significant changes in the world of work. An important outcome of this is the introduction of digital labour platforms that include both web-based platforms, where work is outsourced to a geographically dispersed population (crowd work), and location-based applications (apps) that allocate work to individuals in a specific geographical area, mostly to do local, service-oriented tasks such as driving, and delivering food.

Digital labour platforms have increased five-fold worldwide in the last decade. In the second half of 2018-19, 13 lakh people joined India’s gig economy which is worth $1 billion. While the US leads the race with 53 million independent workers, India has 15 million gig economy workers. With a large young working population, India’s workforce grows by over four million every year, and the absence of enough formal sector job opportunities, more and more job-seekers are enrolling themselves as gig and platform workers. Industry prefers to term these workers as freelances or self-employed.

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Lack of Employer-Employee Relation

While digital labour in the form of gig and platform work can offer new opportunities, it also raises some important questions. As employer-employee relation in such new forms of employment is at best ambiguous and the status of workers remains unclear. They are sometimes perceived as self-employed. Gig and platform work is done by workers, yet many of these workers have become invisible in the labour market framework. Most of these workers don’t see the gig economy as a full-time option due to job insecurity, amplified by complex contracts, the changing rates of incentives, and the lack of control over impossible targets.

Gig economy works outside the traditional employment structures, excluding workers from minimum-wage protection and social security. Companies in such instances do not consider themselves as employers. They prefer to call themselves as aggregators. In the absence of clear employer-employee relation, it is very difficult to apply labour laws. Application of labour laws depend on the premise that employer-employee relation exists. Whether it is minimum wage, protection from arbitrary termination, provision of social security, all depend on the existence of defined employer-employee relation.

In recent times, there have been agitations by Uber/Ola drivers at different cities regarding cut in commissions and deterioration in terms of service. In Bengaluru last February, Ola and Uber services in the city were disrupted as drivers intensified their strike against cab aggregators for a fall in their monthly remuneration. Transport department had called grievance meet twice. Uber did not attend the meeting. Delivery workers of Flipkart and Myntra held demonstrations, struck work regarding poor working conditions.

There are complaints against all aggregators regarding long working hours, poor working conditions and meagre pay/commission. Swiggy and Zomato delivery persons also held agitations protesting fall in delivery prices. These aggregators claimed to treat their workers as partners. However, people who are working for them, allege high level of exploitation.

The problem here is that in such instances, general administration intervened but labour administration could not as this segment of workforce is outside protective labour law framework. Workers have little legal recourse if their work is rejected by the client, giving rise to cases of wage theft. Worker’s risk becoming unlisted (or in practice dismissed) if their star ratings fall, adding pressure to be always connected and always conforming to the given situation.

Labour protection and technological innovation can be compatible here too if the employer-employee relation is put in proper perspective. Presently, technology is being used deliberately to create a blur between employers and employees. There is an urgent need to recognize that it is indeed work and that the work should be decent. Labour protection is not incompatible with technological innovation – it just needs to be adapted. The questions were addressed during two dedicated sessions at the Fourth Conference of the Regulating for Decent Work Network, held at the ILO on 8-10 July in 2015.

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Social security coverage of gig workers

The Code on Social Security 2020 has already received presidential assent. It provides for social security for gig and platform workers along with unorganised sector workers. This is the first occasion that gig and platform workers have been defined and incorporated within the ambit of labour laws. While it is a great initiative by the government, there are issues about overlapping definitions and how to make the registration as inclusive as possible.

Under section 2(35) of the new law a gig worker is defined as a person who participates in a work arrangement and earns from such activities outside of a traditional employer-employee relationship. Section 2(61) defines a platform worker as someone engaged in or undertaking platform work, while section 2(86) defines an unorganised worker as a home-based, self-employed or wage worker in the unorganised sector. This includes a worker in the organised sector who is not covered by the Industrial Disputes Act, 1947, or Chapters III to VII of this Code.

These three definitions have overlapping parts. The definition of unorganised workers is exhaustive enough to include gig and platform workers. With such overlap across definitions, it is unclear how schemes specific to these categories of workers will apply. The Standing Committee on Labour examined similar provisions in the 2019 Bill, and recommended expanding the definition of unorganised workers to include gig and platform workers. It seems the term unorganised sector workers takes care of both gig and platform workers.

State governments have so far been the appropriate governments for the unorganised sector workers. In every state, there is an unorganised sector workers’ welfare board. The unorganised sector is the responsibility of respective state governments. Now, there should not be a problem if the central government pitches in, but the Code on Social Security 2020 has got two sets of social security instruments to be provided. Complexities arise when both the central and state governments are supposed to be providing different sets of social security measures. There is no rationale behind such divisions, and it is clumsy from an implementation perspective.

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Labour laws coverage for gig workers

The fact remains that gig and platform workers are included in the Code on Social Security 2020, but no mention of such workers is made in the three other labour codes. Even for Code on Social Security 2020, gig and platform workers are not entitled to institutional social security such as provident fund, gratuity, paid sick leave, and maternity benefit. They have been included as beneficiaries under social security schemes. Institutional social security and social security schemes are inherently different in concept and scope.

Even though gig and platforms are part of the idea of how work will evolve in the future, the existing labour laws do not see them as future industrial workers. Because of the absence of clear provisions in the labour codes, gig and platform workers can at best seek a few social security benefits, but not labour rights. It doesn’t provide them a right to move the court to demand better and stable pay or regulate the algorithms that assign the tasks. This also means that the government or courts cannot pull up platform companies for their choice of pay or how long they ask people to work.

In recent past, the British Supreme Court gave the ruling that Uber was an employer and should be responsible to provide certain labour rights to its drivers. Amendments to labour laws in Ontario and California have shown a move towards granting employee status to platform workers, thus guaranteeing minimum wage and welfare benefits. This is the view propagated by international agencies in the EU, including the European Trade Union. The government in India should also consider granting the gig workers the status of employees of the aggregators. That would automatically provide them all the labour benefits like PF and ESI.

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Future of labour relations

The Indian Federation of App-based Transport Workers (IFAT) has made a submission to the ministry of labour and employment over the ongoing consultation on the Draft Code on Social Security (Central) Rules, 2020. Several other labour unions and civil society organisations that are concerned about the impact of the ongoing labour law reform process on platform and gig workers’ rights have also signed the submission.

The submission, dated December 21, 2021 also raised concerns about the aggregator contributions towards the social security schemes. Since, platform workers may work for “several aggregators simultaneously, and be engaged as workers for intermittent and irregular periods of time”, the unions have demanded clarity on how these contributions will be assessed in the context of the reality of platform work arrangements is needed. Not only that, it should also be outlined how the number of days worked impacts the nature and extent of social protection that platform workers are eligible for.

A tripartite effort by the state, companies, and workers to identify where workers fall on the spectrum of flexibility and regulation is critical. The way forward for gig and platform workers is through a socio-legal acknowledgement of the heterogeneity of work in the gig economy and the ascription of joint accountability to the state and platform companies towards ensuring labour rights.

Efforts should be made to reclaim employer-employee relation in the digital labour market. Terms of employment and conditions of service should be clearly expressed. Basic norms of international labour standards must be followed. Collective bargaining and social dialogue should be encouraged such that consensus can be arrived at with regards to basic issues of employment relation. Gig economy workers are too important to be left out of the protective legal framework.

Kingshuk Sarkar
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Dr Kingshuk Sarkar is an associate professor at the Goa Institute of Management. He has worked as a labour administrator with the government of West Bengal. He earlier served as a faculty member at VV Giri National Labour Institute, Noida and NIRD, Hyderabad. Views expressed are personal.