The Karnataka State government has been in the news in recent months, mostly for the now on-pause law regarding local reservations in the private sector. Amidst the noise about industry opposition to the proposed move and other ramifications, another draft proposal went relatively unnoticed. This new draft proposal is the Draft Karnataka-Based Gig Workers (Social Security and Welfare) Bill, 2024, which was released on June 29, for objections and suggestions from the public. The draft was to be taken into consideration 10 days after its publication. It was reported that the bill is likely to be introduced in the Karnataka Legislative Assembly in the Winter Session of this year.
Only one state has an act for gig workers—Rajasthan—as of now, and if this draft becomes law, Karnataka would be the second state to enact a law for gig workers’ welfare. Notably, the Indian National Congress (INC) was the ruling party in Rajasthan, as it is now in Karnataka when the act was passed in the legislative assembly. Telangana, another state in which a gig worker draft law has been on the cards, is also a Congress-ruled state. However, Telangana’s law is not publicly accessible yet, and information on it was reported by sections of the media.
A few common threads
Generally, all state governments, as of now, seem to be following a set structure in terms of the welfare of gig workers.
One, in the definitions, they define:
i) Aggregators to include major players like Swiggy, Zomato, etc., and smaller players like, say, Shoffer—a luxury electric car ride-hailing service based out of Bangalore.
ii) Gig workers to include the delivery or ride partners or other such people registered on these platforms for work.
Two, they constitute a board to oversee the welfare of workers and ensure the implementation of the act.
Three, they establish a welfare fund to which the aggregators will be made to pay a certain amount per transaction per worker or some other mechanism.
Four, they outline the rights of the workers and the responsibilities of the aggregators, along with stating the penalties for violations.
While all these elements are present in the Karnataka Gig Worker law draft, it is important to understand the changing contours of employment relations in the gig economy year by year, along with the growing trend of gig work, when drafting the provisions of the law. For example, food delivery workers wear uniforms of the brand they are working with, as mandated, thus providing free marketing to the brand as they ride through the city. This is not factored into the pay given to them, and in fact, the uniforms are supposed to be bought from the brand by the workers themselves. These types of disguised employment conditions are not considered by the government while it defines the relationship between aggregators and workers.
In this context, this article will discuss the Karnataka Gig Worker law, its similarities and differences with the Rajasthan Gig Workers law, and the potential for improvement in the legislation on Gig Worker Welfare.
Draft Karnataka-based Gig Workers (Social Security and Welfare) Bill, 2024
The draft bill defines an aggregator as a digital intermediary for a buyer of goods or user of services to connect with the seller or the service provider, and includes any entity that coordinates with one or more aggregators to provide the services. Essentially, a food delivery app like Swiggy, or an app that facilitates the hiring of electricians or beauticians like Urban Company, comes under the definition.
Section 2(e) of the Act defines gig workers as a person who performs work or participates in a work arrangement that results in payment based on terms and conditions laid down in such a contract. This includes all piece-rate work, and whose work is sourced through a platform, in the services listed in Schedule-I.
The Schedule includes the following services:
- Ride Sharing Services
- Food and Grocery Delivery Services
- Logistics Services
- E-Marketplace for wholesale/retail sale of goods and/or services—B2B/B2C
- Professional Service Providers
- Healthcare
- Travel and Hospitality
- Content and Media Services
The draft bill has provisions for the rights of the gig worker in Section 6, granting them the right to register with the Gig Workers Welfare Board—established under Section 3—and the right to access general and specific social security schemes, as well as the right to access a grievance redressal mechanism (Section 7). This Grievance Redressal Mechanism involves either a complaint to the state government-appointed officer or a petition through a web portal whose link should be provided on the aggregator’s website.
The draft also outlines several responsibilities for aggregators:
- Aggregators must provide a database of workers to the board and update it (Section 10).
- Aggregators must register themselves (Section 11).
3. Aggregators must ensure that the contract is fair, easily understandable in a language comprehensible to the worker and listed in the 8th Schedule of the Indian Constitution. Any change in the contract should occur with prior notice, and termination of the contract by the worker on account of the change should not affect the entitlements they were supposed to receive.
4. Aggregators must communicate to the gig worker the parameters of allocation, distribution, assessment, and grounds for denial of work, as well as the parameters of the rating system and categorization of the workers on the quality of service, log-in time, etc. if such categorization is done by the employer (Section 14).
5. Aggregators cannot terminate the gig worker without prior notice of 14 days, and the contract must have an exhaustive list of grounds for termination or deactivation from the platform (Section 15).
6. Aggregators must pay workers weekly without delay (Section 16).
7. Aggregators must ensure reasonably safe and healthy working conditions, as practicable as possible (Section 17).
8. Aggregators must ensure that a grievance link is available on their website and constitute an internal dispute resolution committee if they have more than 50 workers. These disputes include failure to adhere to the responsibilities mentioned above (Section 24).
9. Aggregators must appoint a human point of contact for queries, with workers having the option to communicate in Kannada, English, or any 8th Schedule language known to them.
The draft also proposes the establishment of a welfare fund, to be funded by the aggregators at a percentage of the pay of platform-based gig workers per transaction or based on annual state-specific turnover, as may be notified by the government. For this purpose, the draft proposes a Central Transaction Information Management System where all transactions are mapped and monitored by the Board to ensure that payments made to workers and deducted fees are recorded and accounted for. Penalties range from Rs. 5,000 to Rs. 1, 00,000 and are compoundable unless the offense has been committed on more than three occasions.
It was also reported in the media that the government and aggregators agreed on levying a cess per transaction rather than based on state-specific turnover.
Similarities and differences with the Rajasthan Act
Both laws establish a board, give similar powers to the gig worker welfare board, and establish Central Monitoring Systems. In essence, both laws grant the same rights to workers, impose the same responsibilities on aggregators, and establish welfare funds.
However, the difference lies in the details of these broad structures. For example, the Rajasthan Act explicitly recognises the right of workers to participate in all decisions taken for their welfare through representation on the board. In constituting the board, the Rajasthan Act mandates that one-third of the members shall be women. The Karnataka draft misses these provisions and does not have as many members on the board. The Rajasthan law includes 12 board members, including the in-charge minister, while the Karnataka draft includes 10 members, with five being ex-officio members from various departments.
The Karnataka Act also emphasises transparency and the need for communication in languages understandable by the worker. By making it mandatory for the aggregator to provide details of the rating system or categorization of gig workers based on the quality of service rendered, log-in time, or other criteria, the draft attempts to lift the veil under which aggregators have operated until now.
Other key differences can be found in the welfare fee and penalty sections. The draft Karnataka law chooses an either-or approach, where the welfare fee could either be a percentage of each transaction or a percentage of the state-specific annual turnover. The Rajasthan Act does not mention turnover. In terms of penalties, Rajasthan’s law imposes penalties ranging from Rs. 5 lakh to Rs. 50 lakh. The Rajasthan Act also has provisions for interest payable on delayed payment of the welfare fee.
Potential for development
There is much room for development in the Karnataka draft law. While the fundamental question of defining the relationship between the gig worker and aggregator has not been answered, the draft leaves many concerns in the areas it chooses to operate in.
For example, it does not consider women in the gig workforce, nor does it enact specific provisions to protect their interests, such as maternity-specific provisions where women do not have to lose their categorization within the platform if they take a maternity break.
The bill has already been reportedly opposed by various companies due to concerns about compliance, with claims that it will hurt the ease of doing business in the state. While these concerns are expected, the sheer volume of compliance measures businesses must adhere to under the act raises doubts about its effective implementation. Meanwhile, Kerala’s Minister for Labour, V. Sivankutty, stated in August that the government intend to introduce the Kerala State Platform-Based Gig Workers (Registration and Welfare) Bill, 2024 in the assembly session this October.
In this paradigm, where the government seems to have decided not to accord the status of a worker to the gig worker and the status of an employee to the aggregator, the least it could have done is to provide for the increased bargaining power of the worker. This could have been achieved through the official recognition of unions in the gig economy, allowing bargaining to be done with unions or federations of such unions.
Conclusion
Despite the improvements in the Karnataka draft law, the fundamental question and demand remain unheeded. With the control aggregators usually exert on gig workers, the demand has been that gig workers be recognized as employees. With the BJP in Rajasthan not giving importance to the previously enacted gig worker law, and Congress governments consistently defining the relationship between gig workers and aggregators as independent individuals rather than employees, the future possibilities look narrower.
Such a law should not be a choice between no protection at all and meagre protection for gig workers.
(The writer is a researcher with the organisation)
Related:
Rajasthan’s Gig Worker Law, a step towards industrial democracy
Karnataka Budget 2023-24: CM announces Rs. 4 lakh life & accident insurance policy for gig workers
Report Highlights Poor Working Conditions for Gig Workers; Uber, Ola, Amazon Score Zero
Report Highlights Poor Working Conditions for Gig Workers; Uber, Ola, Amazon Score Zero