Gig Economy and Gig Workers in India

Context

A recent survey conducted across multiple Indian Cities, titled ‘Prisoner on Wheels’ sheds light on the challenges faced by many cab drivers and delivery persons.

About Gig Economy

• A Gig economy is a labour market that relies on independent contractors and freelancers rather than full-time permanent employees.
• Trend Change in recent years: Rise in the rise of ‘gigification’ or adoption of the gig model – reshaping work dynamics.
• Gig Workers consists: 
  • Freelancers who get paid per task;
  • Independent contractors who perform work and get paid on a contract-to-contract basis;
  • Project-based workers who get paid by the project;
  • Temporary hires who are employed for a fixed amount of time; and
  • Part-time workers who work less than full-time hours.

Benefits of Gig Economy:

• For Workers: Gig economy can provide more flexibility, autonomy, income opportunities, skill development, and inclusion.
• For Employers: It can enable access to a large and diverse pool of talent, lower fixed costs, higher scalability, and better customer satisfaction. 
• For Customers: It can offer more choice, convenience, quality, and affordability

Gig Economy Regulatory Framework in India

• Code on Wages, 2019: A universal minimum wage and floor wage should be provided to all organised and unorganised sectors, including gig workers.
• Code on Social Security, 2020: Under this, the gig workers are provided with recognition as a new occupational category.
• Dedicated Social Security Fund: It extends social security benefits to gig workers.
• Motor Vehicle Aggregator Guidelines,2020: Under this, gig workers are entitled to get a term insurance of Rs 15 lakh and health insurance of Rs 10 lakh with 2020-21 as the base year and with an increase of 5% each year.

Concerns Associated with Gig Economy in India

• Lack of Formalisation: Many gig workers in India operate in the informal sector, which can limit their ability to access credit, government support programs, and other resources.
• Lack of Legal Protection & Social Security: Gig workers are not covered under India’s labour laws and do not have legal protection in case of workplace harassment, discrimination, or unfair termination.
• Payments, Incentives, and Growth Models: Absence of a minimum wage guarantee makes workers.
• Training and Upskilling: Many Gig Workers: Many Gig Workers lack the necessary skills to perform their work better.
• Social Stigma: Gig Work is still viewed as a temporary and low paying job in India. There is also a lack of recognition of work done by them in the Society.
• Increase in voluntary Unemployment: as some prefer autonomy and flexibility over traditional work.
• Disrupting Work Life Balance: Especially Sleep patterns,activities of daily life etc.
• Job Security: Workers are typically engaged on assignment or project basis.

Way Forward as suggested by Survey

• Overtime Payment Beyond Regular Hours: Considering the physically intense nature of this work, the number of hours that are ‘regular’ hours needs to be stipulated beyond which the platform must pay overtime.
• Payment of Minimum Wages to Platform workers: The gig and platform workers need to be treated as employees.
• Preserving Flexibility of Work for Gig Workers: The design of social security for gig workers must seek to preserve the flexibility of work
• Stronger Social Security for App-based Workers: The government needs to exercise oversight on the fairness of algorithms and mechanisms used by platforms to monitor such workers.
• Welfare Board for Gig Workers: It needs to be set up for the welfare of gig workers and it should be mandatory for aggregators to provide details of all registered gig workers to the board.
• Addressing Occupational Health Hazards: Giving essential safety training, especially for roles with inherent risks, and safety equipment and resources can go a long way in encouraging temporary workers.
• Addressing Mental Health: Companies should normalise work life balance and taking breaks.

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