Gig Workers in India

What’s in Today’s Article?

• Why in News?
• What is Gig and Platform Economy?
• Who are Gig Workers?
• Importance of Gig Workers and Issues Faced by Them
• Highlights of the Recent Study on App-Based Workers

Why in News?

• According to a recent study on app-based workers, they work long hours for minimal pay, with 68% of drivers reporting that their expenses surpass their profits.
• Hence, regulatory oversight and monitoring methods for app algorithms are required.

What is Gig and Platform Economy?

• The term gig economy means a general workforce environment, which includes short-term employment, contractual jobs, and independent contractors.
  • It is also called freelancer economy, agile workforce, sharing economy, or independent workforce.
• The platform economy refers to the trend of commerce increasingly strongly attracted toward and favouring digital platform business models.

Who are Gig Workers?

• The new Labour Codes of 2019 defines a 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”.
  • It includes freelancers, workers who are employed on a contractual and project-based basis and short-term work.
• Most commonly, platform-based work where workers earn money by providing specific services, including food delivery services like Zomato, Swiggy or e-commerce platforms such as Amazon, Flipkart, use gig workers.
• It is estimated that 77 lakh workers were engaged in the gig economy in 2020-21 constituting 2.6% of the non-agricultural workforce or 1.5% of the total workforce in India.
  • The gig workforce is expected to expand to 2.35 crore workers by 2029-30.

Importance of Gig Workers and Issues Faced by Them

• The role of gig workers has been gaining importance as they infuse flexibility and talent availability in the job market.
• The future workforce will indeed be a blended model -
  • Wherein the gig economy is expected to play an important role not only as a talent management strategy,
  • But also accelerate job creation and boost the country’s economic growth.
• However, Niti Aayog’s report ‘India’s Booming Gig and Platform Economy’, recognises lack of job security, wage irregularity and uncertain employment status for workers, as top challenges in the sector.
  • It recommends extending social security provisions such as sick leave, insurance and pension to gig workers and their families.
• The new Rajasthan Platform-Based Gig Workers (Registration and Welfare) Act 2023 is the first-of-its-kind ground-breaking piece of legislation.
  • It aims to establish a welfare board and a dedicated social security fund for platform-based gig workers in the state.

Highlights of the Recent Study on App-Based Workers

• Long working hours: Almost a third of app-based cab drivers work for over 14 hours a day, while more than 83% work more than 10 hours and 60% work over 12 hours.
  • Social disparities make the situation worse, with over 60% of the drivers from SCs and STs working for over 14 hours a day.
• Low earnings: Over 43% of participants in the study earn less than ₹500 a day or ₹15,000 a month, after deducting all their costs.
  • Over 80% of app-based cab drivers were not satisfied with the fares offered by the companies, while over 73% of app-based delivery persons showed dissatisfaction with their rates.
  • 68% of cab drivers’ overall expenses exceed their earnings, which indicates how a vast number of app-based workers could be in debt-like situations.
  • These income disparities further exacerbate the already existing social inequalities and perpetuate cycles of poverty and distress.
• Stress and potential health issues: Due to the demanding work hours, drivers are physically exhausted.
  • They are exposed to an increased risk of road traffic accidents, especially due to the 10-minute delivery policy of certain e-commerce platforms.
  • The lack of social and job security creates additional stress and leads to potential health issues.
• Other issues:
  • 41% of the drivers and 48% of delivery persons said they are unable to take even a single day off in a week.
  • Less than 37% of the drivers said they belonged to a union.
  • Another major complaint of the workers is the issue of ID deactivation and customer misbehaviour.
• Recommendations: The study recommended stronger social security for app-based workers.
  • It called on the government to exercise oversight on the fairness of algorithms and mechanisms used by platforms to monitor such workers.

Q1) What are the new Labour Codes of 2019?

The Government has formulated four Labour Codes, namely, the Code on Wages 2019, the Industrial Relations Code 2020, the Code on Social Security 2020 and the Occupational Safety Code 2020. These will subsume the existing 29 central labour and industrial laws and will reduce multiplicity of laws.

Q2) What is the Rajasthan Platform-Based Gig Workers (Registration and Welfare) Act 2023?

The Act provides for the constitution of a Welfare Board to register platform gig workers, aggregators, and primary employers; notify the social security schemes for registered platform-based gig workers and ensure that workers have access to benefits under the plans.