The term "gig economy" describes a labor market where jobs are short-term, task-based, and often facilitated through digital platforms. These "gig" workers-also referred to as platform workers-operate more as freelancers or independent contractors than traditional employees[1]. This allows for flexibility and autonomy, but lacks the protections offered by standard employment, such as social security, health insurance, or guaranteed minimum wage.[2] For example, if I hire a painter to paint my door, the painter is working for me only for that task and isn't my permanent employee.

Similarly, when we book a ride on Uber, the driver provides a service for that specific trip but isn't a full-time employee of Uber. Instead, the driver is considered a gig worker, working independently and only getting paid for each completed ride, without the benefits and security regular employees typically have.

India's gig economy has expanded dramatically, with platforms like Uber, Zomato, Swiggy, UrbanClap (now Urban Company), and Ola leading the charge. These companies offer convenient, on-demand services for consumers while creating earning opportunities for millions of gig workers. Indian companies such as Dunzo, Rapido, and Housejoy are also thriving in this space, particularly in urban areas where demand for fast services continues to grow. According to a report by the Boston Consulting Group[3], India's gig economy is estimated to employ over 15 million workers by the end of 2024, with significant growth in sectors like transportation, food delivery, and personal services.

The legal landscape for gig work in India is evolving. While gig workers are essential to the digital economy, they have historically not[4] been covered under most employment laws, such as the Minimum Wages Act, 1948[5], or the Payment of Wages Act, 1936[6]. In 2021, the Indian Federation of App-based Transport Workers (IFAT) filed a public interest litigation in the Supreme Court, seeking social security benefits for gig workers. The case argued that these workers should be classified as "unorganised workers" under the Unorganised Workers' Social Security Act, 2008, allowing them access to essential benefits. IFAT contended that gig workers face exploitation due to the absence of employment contracts and formal employer-employee relationships, which app companies avoid by classifying themselves as "aggregators."[7]

The PIL raised fundamental constitutional concerns, stating that excluding gig workers from social security protections violates their rights under Article 21 (right to life and personal liberty) and Article 14 (right to equality) of the Indian Constitution. Additionally, IFAT referenced the United Kingdom's Supreme Court ruling[8] that classified Uber drivers as workers with rights, implying a similar need for such recognition in India

Under the Code on Wages, 2019[9], the definition of a "worker" is provided in Section 2(k). It states:

"Worker" means any person (except an apprentice as defined under clause (aa) of section 2 of the Apprentices Act, 1961) employed in any industry to do any manual, unskilled, skilled, technical, operational, clerical, or supervisory work for hire or reward, whether the terms of employment be express or implied, and includes working journalists and sales promotion employees, but does not include any such person-

1. who is employed mainly in a managerial or administrative capacity; or
2. who is employed in a supervisory capacity drawing wage exceeding such amount as may be notified by the appropriate Government from time to time." [10]

This definition is central to determining eligibility for benefits and protections under the Code, as it clarifies that only individuals performing specific types of work are recognized as "workers" with entitlements, while those in managerial or high-earning supervisory roles may not fall under this category.

Under the Code on Social Security, 2020[11], the definition of a "gig worker" is provided in Section 2(35). It states:

"Gig worker" means a person who performs work or participates in a work arrangement and earns from such activities outside of a traditional employer-employee relationship.

This definition marks a significant step in recognizing the unique status of gig workers, who operate independently of conventional employment structures and often engage with digital platforms to provide services or complete tasks[12]. This classification aims to extend certain social security benefits, though full implementation and specific benefits are still under development.

The definition of "gig worker"[13], while progressive, presents several key issues:

1. Ambiguity in Scope: The definition lacks specific criteria for what constitutes "gig work," which can lead to inconsistent interpretations. Since the term "gig work" can cover a wide range of jobs, from ride-sharing drivers to freelance writers, the definition needs clearer boundaries to help determine who qualifies for protections.[14] For example, A freelance photographer hired for a wedding may technically be classified as a gig worker, but it's unclear if this fits the intent of the Code, as their work does not align with digital platform-based services like Uber or Swiggy. The scope of what qualifies as gig work needs to be specified for clarity, especially in terms of job types beyond platform-based services.
    
2. Overlap with Platform Workers: The Code defines both "gig workers" and "platform workers," with considerable overlap between these categories. Platform workers are defined as those who work through digital platforms, which also applies to many gig workers, creating potential confusion over eligibility for benefits and how these terms should be applied.
    
3. Lack of Employment Relationship: Gig workers are outside traditional employment relationships, which complicates their eligibility for typical labor protections such as minimum wage, health benefits, and job security. This omission limits their access to social security schemes and leaves them without a legal safety net in terms of wages and working conditions.
    
4. Unclear Benefit Funding: The Code allows the government to create social security schemes for gig workers but doesn't specify how these schemes will be funded. For example, If a delivery rider is entitled to social security benefits under the Code, it's not clear who should contribute to these benefits-Uber, the rider, or the government. For instance, there is no defined model for sharing the financial responsibility for accident insurance, which leaves gig workers without guaranteed support in case of injury.
    
5. Exclusion of Self-employed Gig Workers: Many gig workers are classified as independent contractors or self-employed, which could exclude them from social security coverage. If a gig worker is not engaged through a platform (e.g., direct freelance work), it's uncertain whether they would still qualify under this definition, potentially leaving a large segment of gig workers without coverage.
   
   For Example, A freelance web designer who works independently with clients may fall under the gig worker category but not qualify for benefits if they are not working through a platform like Fiverr or Upwork. Without platform involvement, such workers may miss out on benefits that the Code aims to provide, such as healthcare or old-age pensions, despite working in a similarly precarious situation as platform workers.[15] A report by The Observer Research Foundation[16] argues that, without a standardized approach, many gig workers may fall through the cracks. The report states, "The lack of clear guidelines on hourly rates and the exclusion of platform workers from minimum wage laws leaves millions of gig workers vulnerable to exploitation."

Looking Forward: Needed Legal Reforms
The Social Security Scheme for Gig Workers in India, as outlined in the Code on Social Security, 2020, aims to provide benefits such as health insurance, accident coverage, and old-age pensions. However, its full implementation and calculation remain subject to specific government regulations, which need to be carefully developed. For India's gig economy to be both fair and sustainable, some reforms are essential[17]:

1. Eligibility and Contributions Gig workers, including platform workers (Uber, Swiggy) and independent contractors (freelancers, delivery personnel), would be eligible for the scheme. Gig workers who are working outside traditional employer-employee relationships will be enrolled and registered. The scheme could follow a shared contribution model, where both the platform companies (e.g., Uber, Zomato) and the workers contribute to the social security fund. For example, Uber could contribute a percentage of the fare from each ride (e.g., 2%) to the fund, while the worker might contribute a small portion of their earnings (e.g., 1-2%). The government could also contribute based on tax revenues or special funds allocated for gig workers.
2. Calculation of Benefits The scheme could use gig workers' monthly earnings or annual income to calculate the amount they should contribute to the scheme and the benefits they are eligible for. If a worker earns ₹20,000 per month, they may contribute a percentage (e.g., 1-2%) toward the scheme, which would then be matched by the platform and the government. Social security benefits like pensions and health insurance could be accrued based on monthly earnings. For example, if a worker contributes ₹200 per month to the pension fund, they could receive a pension based on this contribution once they retire. Similarly, Gig workers' health insurance premiums could be tied to their earnings. The more a worker earns, the higher their premium contribution, ensuring that high-earning workers have better coverage.
3. Challenges in Implementation and Practical Limitations
   • Tracking Earnings: Since gig workers often have variable incomes, calculating consistent contributions can be complex. Platforms may need to implement systems to track earnings in real time, which could add administrative costs.
   • Voluntary Participation for Self-employed Workers: Self-employed gig workers (e.g., freelance web developers, independent contractors) who do not work through platforms may need to voluntarily opt into the scheme, complicating enrollment.
   • Adjustment of Contribution Rates: Over time, the government can adjust contribution rates, premiums, and the types of benefits provided to ensure the scheme remains financially sustainable and addresses the evolving needs of gig workers. The government may need to establish data-sharing frameworks between platforms and regulatory bodies to ensure fair and transparent distribution of funds.

These steps would help ensure gig workers are included in the social security framework, providing them with financial safety nets similar to those available to formal sector employees.

As India's economy adapts to the changing workforce, legal reforms can help ensure that gig workers aren't left without fair wages and social protection. The current legal framework is a step in the right direction, but "gig gaps" remain. Recognizing gig workers and ensuring they are protected under labor laws isn't just a good idea-it's essential for a thriving and fair economy. These workers are the backbone of a vast array of services, from ride-hailing to food delivery, but they often face precarious conditions without the security of traditional employment benefits. As the gig economy booms, it's crucial to address the gaps in labor protections, including minimum wage laws and social security benefits, which would directly impact workers' financial stability.

Without a comprehensive framework[21], gig workers may continue to fall through the cracks, leading to widespread exploitation (ILO, 2021). Implementing these protections would not only elevate the conditions for gig workers but also foster a more equitable economic ecosystem that benefits both workers and employers.[22] After all, as the Observer Research Foundation (2021) emphasizes, a standardized approach is key to ensuring gig workers receive fair treatment across

End Notes:

1. Ministry of Labour and Employment, Government of India. (2020). Report on the impact of the gig economy on labor laws. labour.gov.in
2. Nair, S., & Chattopadhyay, S. (2021). Legal protections and social security for gig workers in India: A comparative study. Journal of Indian Law and Society. jils.co.in
3. https://www.bcg.com
4. https://www.businessinsider.in/business/news/zomato-swiggy-ola-uber-app-gig-workers-move-supreme-court/articleshow/86420264.cms
5. Ministry of Labour and Employment, Government of India. The Minimum Wages Act, 1948. labour.gov.in
6. Ministry of Labour and Employment, Government of India. The Payment of Wages Act, 1936. labour.gov.in
7. https://www.businessinsider.in/business/news/zomato-swiggy-ola-uber-app-gig-workers-move-supreme-court/articleshow/86420264.cms
8. Uber BV v Aslam & Others [2021] UKSC 5
9. https://labour.gov.in/sites/default/files/Code_on_Wages_2019.pdf
10. Supra note 1
11. Code on Social Security, 2020. Ministry of Labour and Employment. https://labour.gov.in/sites/default/files/Code_on_Social_Security_2020.pdf
12. Mitra, S. (2021). Social security for gig workers: Challenges and opportunities. Labour Studies Journal. jstor.org/journal/labstudies
13. Section 2(35) of the Code on Social Security, 2020
14. Supra note 2
15. Subramanian, R. (2020). Labor reforms and the gig economy: A path forward. Economic and Political Weekly. epw.in
16. Observer Research Foundation. (2021). The Gig Economy and the Law: Protecting the Workers. The Observer Research Foundation. orfonline.org
17. Code on Social Security, 2020 (Section 109): Introduces provisions for social security for gig and platform workers.
18. Social Protection for Gig and Platform Workers. ilo.org/global/topics/employment-promotion/platform-economy/lang–en/index.htm
19. Ibid
20. Supra note 2
21. Ibid
22. Ghosh, J. (2021). Labour law and the gig economy in India: Perspectives from the Global South. journals.sagepub.com/home/sae