Nasscom's feedback on Karnataka govt's Bill for welfare and social security of platform gig workers

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Nasscom's feedback on Karnataka govt's Bill for welfare and social security of platform gig workers

Sudipto

@Sudipto

July 11, 2024

Public Policy

355

Given India’s overwhelming workforce both in the formal and informal sector, gig workers have always been part and parcel of our economy. This is necessary given the size of the informal workforce and difficulties in creating enough salaried jobs. However, the term “gig worker” has reacquired attention over the last decade with their growing participation in the platform economy (cab aggregators, food delivery, logistics). A recent NCAER study (2023) shows that digital platforms have created jobs for young urban male who use platform gig work not as a career option but to augment incomes for a short duration.

Typically, platform gig workers are not employees and as a result, they often lack access to social protection systems designed for employment relationships. Some contend that platform gig workers, despite being classified as independent contractors, face similar vulnerabilities and risks as traditional employees. Further, at times, the element of difference between gig work and regular employment (like, autonomy, work instructions) may get blurry requiring closer examination. For instance, EU member states are debating a proposal to establish a legal presumption of employment in their legal systems, to be triggered when facts indicating control and direction are found.

Over the years, the concern around lack of social protection of such platform gig workers has been acknowledged globally. Countries have framed rules (India has designed such welfare measures under the Code on Social Security, 2020 - CoSS) or contemplating to make to ensure social protection of such gig worker. During India’s G20 Presidency, the New Delhi Leaders’ Declaration listed ‘ensuring adequate social protection and decent working conditions for gig and platform workers’ as one of its goals to address skill gaps in the world.

While the central law - CoSS is yet to come into operation, some of the states have legislated or in the process of making such laws for social security and protection of platform gig workers. However, these interventions have been sudden and isolated without involvement of the relevant stakeholders which is not a correct approach to address the situation.

The recent Karnataka Platform based Gig Workers (Social Security and Welfare) Bill, 2024 (Bill), while premised on a good intention, suffers from many challenges. Nasscom has given a detailed representation (see, attachment) to the government of Karnataka to highlight the challenges with the Bill and recommended that any proposal of this significance which impacts the platform industry needs extensive consultations.

The representation highlights some of the following concerns:

The Bill proposes a parallel structure of social security law for platform gig workers, duplicating the central law – CoSS. It does not propose a sunset clause-mechanism that will subsume the Bill into the CoSS when the same comes into force.

It assumes gig work to be a part of employer-employee relationship, which risks unsettling the conceptual and legal basis of gig work. This assumption is core of the Bill and basis this, it prescribes several obligations which may be relevant only in an employer-employee relationship.
It proposes a parallel fee structure as the aggregators who would contribute funds under the CoSS (once it is notified), would also contribute funds for similar purposes under this Bill. Further, the fee structure suffers from multiple design level concerns.
Then the Bill lays down onerous and prescriptive obligations on aggregators like minimum notice period for termination, algorithmic disclosures, monitoring and tracking mechanism and prescribing terms of contract. These obligations are incompatible with the functioning of gig platforms and can adversely impact their operations in Karnataka.
The Bill has serious gaps not only from an industry perspective but also from the gig workers perspective, as it fails to state the end-use of fees/funds collected from aggregators/platforms.

Social security and welfare of platform gig workers is an important policy concern. However, we need a balance between social security and flexibility of platform to retain gig workers in terms of obligations and cost of doing business.

With this understanding, nasscom has requested that:

The public consultation period should be extended to at least forty-five (45) working days (from ten working days) for a meaningful consultation.

As part of the consultation, the government may convene an inter-departmental meeting (involving the Department of Labour, Department of Electronics Information Technology Biotechnology and Science & Technology and Department of Commerce and Industries). Such meeting should invite participation of platform businesses operating in Karnataka, industry associations and other relevant stakeholders.

For more information on the above, please write to sudipto@nasscom.in with a copy to policy@nasscom.in.

platform gig workers social security Karnataka

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Sudipto