GS Paper III

News Excerpt:

India's gig and platform economy, currently comprising 8 million workers, is set to burgeon to 23.5 million by 2029-30 (NITI Aayog, 2022). A 2023 study by FICCI and Randstad India shows that 42.24% of startups in India are increasingly hiring temporary and gig workers.

Gig Worker:

• According to NITI Aayog, gig workers are individuals engaged in livelihoods outside the traditional employer-employee arrangement.
• These workers may be classified into platform-based and non-platform-based workers.
• Platform workers are those whose work relies on online software apps or digital platforms to connect with customers and provide services. 
• They operate within the framework of online platforms, often completing tasks or assignments for a fee without a direct employer-employee relationship.
• Non-platform gig workers, on the other hand, typically work in conventional sectors as casual wage workers or own-account workers, either part-time or full-time.
• Section 2 (35) of the Code on Social Security, 2020, which is part of the four new labour codes, for the first time, defined “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.

Platform Worker:

• As per Section 2(61) of the Code on Social Security, 2020, a platform worker is defined as someone engaged in platform work.
• Platform work, defined in Section 2(60) of the same code, refers to a work arrangement outside the traditional employee-employer relationship facilitated by an online platform. These platforms are utilized to solve specific problems or provide particular services.

Challenges regarding gig and platform workers.

• Delays in drafting and implementing rules at both central and state levels exacerbate the challenges that gig and platform workers face, leaving them without adequate protections and benefits.
  • Their families are vulnerable in case of emergencies or accidents while on the job.
• Gig and platform Workers endure long hours without paid leave, health coverage, pension, provident fund, and medical cover despite their significant contributions to the economy.
  • According to the Boston Report, the gig economy has the potential to transact over $250 billion in volume of work and contribute an incremental 1.25 per cent to the GDP over the long term.
• Platform workers have limited or no voice in decision-making processes. Due to technological advancements, the power dynamics heavily favour platform companies, resulting in gig workers having minimal bargaining power.
  • 83% of cab drivers and 73% of delivery persons report being affected by deactivation and blocking by platforms, leading to loss of income.
  • A recent survey of 10,000 cab drivers and delivery persons by the University of Pennsylvania in Delhi, Lucknow, Jaipur, Indore, Mumbai, Kolkata, Hyderabad and Bengaluru revealed that nearly 60 per cent of cab drivers reported working for more than 12 hours in a day, and 78 per cent delivery personnel for more than 10 hours a day.

Way Ahead:

• A new law should come along the lines of the one in Rajasthan to improve the working conditions for gig and platform workers and give them social security.
• Modelled after the Rajasthan Platform-Based Gig Workers (Registration and Welfare) Act, 
• It established a welfare board, created a registry for gig workers, and assigned unique IDs valid across platforms.
• The law proposes a platform-based welfare cess on each transaction, ranging from 1 to 2 percent of the transaction value, to finance social security schemes for gig workers.
• If implemented effectively, the new law can significantly improve the working conditions and livelihoods of gig and platform workers, benefiting millions who rely on informal work arrangements in the gig economy.
• The focus of the proposed law is to provide social security benefits to gig and platform workers,
•  Addressing issues such as lack of paid leave, health coverage, and pension,
• NITI Aayog urges incorporating these mandatory points in new bill skill development, financial support, improved surveys, and social security for platform workers to foster inclusivity and security in the digital economy.
• Supporters of the gig economy emphasize the need to recognise gig and platform-based workers as employees, ensure minimum daily earnings, and establish transparent and fair contracts to improve their livelihoods.