Rajasthan Platform Based Gig Workers (Registration and Welfare) Act, 2023:
A claim to address the problems of gig workers

The Government of Rajasthan passed the Rajasthan Platform Based Gig Workers (Registration and Welfare) Act, 2023 on July 24, 2023.

The Act is the result of a long and arduous struggle and efforts by organisations such as the Mazdoor Kisan Shakti Sangathan (MKSS), of workers’ unions like IFAT (Indian Federation of App-based Transport Workers) and many other workers’ organisations.

The Act promises to (i) constitute a Welfare Board and to setup a welfare fund for platform based gig workers; (ii) to register platform based gig workers, aggregators and primary employers in the State; (iii) to facilitate guarantee of social security to platform based gig workers and (iv) to provide a mechanism for gig workers to voice their grievances through representation in the welfare board.

The Gig Workers Security and Welfare Fund will receive funds from the Rajasthan Government and from aggregators. The aggregators will contribute to the fund a percentage of the value of each transaction. The Rajasthan government will contribute Rs 200 crores.

The state government will create and maintain a database of the gig workers and generate a unique ID for each one of them. The aggregators will have to share the database of the gig workers working for them with the state government.

The Act has a provision for penalties if employers or aggregators fail to pay the welfare fee within time. The fine may extend up to Rs 5 lakh for the first contravention and up to Rs 50 lakh for subsequent contraventions for an aggregator. In case of a primary employer, the penalty may extend up to Rs 10,000 for the first contravention and up to Rs 2 lakh for subsequent contraventions.

The problems of gig workers that urgently need to be addressed

In recent years, the gig economy (in which companies and workers enter into an arrangement outside of the traditional employer-employee relationship) is steadily expanding into more and more sectors of the economy. India is currently estimated to have more than 1.5 crore gig workers. Of these, an estimated 99 lakhs are in delivery services. According to a NITI Aayog report in 2022, nearly 2.35 crore workers will be working in the gig economy by 2029.

Gig workers are not recognised as workers by the labour laws of India. They are referred to by names, such as “delivery partners”, “delivery executives”, etc., which hide the real exploitative character of their relationship with the capitalist company that is their employer.

Gig workers are excluded from all rights that accrue to workers as referred to in the Code on Wages, Code on Industrial Relations, and the Code on Occupational Safety and Health. These include limit on the length of the working day, minimum wages, occupational safety and health benefits and overtime pay. The company owners refuse to negotiate with any unions that they may form since these unions are not formally recognised and cannot file cases in labour courts against the company owners.

Gig workers do not have fixed working hours. Their work schedule is set and strictly monitored by online platforms of the owner companies. Their working hours often extend to 12-14 hours a day. This leaves them very little time for rest or attending to family matters and greatly increases their stress levels.

All gig workers are under pressure to deliver their service in a short time. In particular delivery workers, as well as cab and auto drivers are under immense pressure to maximise the number of trips in a given span of time. As a result, they often suffer from road accidents which can sometimes be grievous or even fatal.

Insecurity of livelihood, the lack of a steady job and an adequate, secure income is the main problem faced by gig workers. The average incomes of many delivery workers in the gig economy are generally lower than the government’s announced minimum wages. These too have been falling in recent years, as most of the incentives initially offered by the owner companies have been withdrawn. They can be thrown out of their jobs at a moment’s notice, whenever the owner company considers employing them unprofitable.

The Act fails to address many of these problems

The Rajasthan Platform Based Gig Workers (Registration and Welfare) Act, 2023 fails to address many of these major problems of gig workers, even as it promises a mechanism to ensure some form of social security to these workers and for grievance redressal. It does not base itself on the experience of the struggles of gig workers in other countries and the rights they have won, as a result of their struggle. (See Box : Rights won by gig workers in other countries)

First, the Act bases itself on the definition of 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 relationships and who works on a contract that results in a given rate of payment’. It defines an aggregator as a ‘digital intermediary’ and includes ‘any entity that coordinates with one or more aggregators for providing the services.’

These definitions have been deliberately left vague. They do not clearly specify the company owner or aggregator as an ‘employer’ and the gig worker as a ‘worker’; the employer being legally bound to ensure certain rights and benefits to the worker and the worker being entitled to such rights and benefits. In this sense, the Act does not address some of the main concerns of gig workers – that of their recognition as workers, their right to minimum wages, a limit on the length of the working day, occupational safety and health benefits and the right to organise themselves in trade unions. The company owners can continue to force the workers to work for 12-14 hours a day at below minimum wages and deny them medical expenses for accidents incurred in the course of their work. They can be thrown out of their jobs without any prior notice or any monetary compensation.

Second, the Act proposes to create a database of gig workers. The details of all the workers registered with a platform are supposed to be transferred to the proposed gig workers’ welfare board. However, the Act does not put forward any mechanisms to enforce this, nor does it propose any penalties for owners who may not transfer details of all the gig workers they are employing on to the welfare board platform.

Third, many gig workers often work for two or more aggregators on a given day, to make up for their falling incomes. It is possible that a mandatory system of registration will enable the aggregators to know about the worker’s details of employment with multiple aggregators and block such possibilities for the worker. There is nothing in the Act to prevent company owners from doing this.

Fourth, the Act promises to guarantee social security to platform-based gig workers by constituting a representative welfare board and creating a welfare fund. But it neither defines what constitutes social security nor specifies welfare measures that can broadly be construed as social security. Instead, it leaves this crucial aspect to the discretion of the welfare board, to ‘formulate and notify schemes for social security of registered platform-based gig workers and take such measures as it may deem fit for administering such schemes’.

Finally, the Act proposes a mechanism of grievance redressal through gig workers’ representation in the welfare board. The board will have five gig worker representatives nominated by the State government. However, the board will be dominated by powerful representatives of the capitalist companies who own the platforms, and members of the bureaucracy and the government who will fully defend the interests of the capitalist owners.

Without recognition as workers and in the absence of trade union rights, the gig workers will not be in a position to collectively fight for their demands or to enforce any solution to their problems.

The way forward

With increasing numbers of workers joining the gig economy, in the absence of any other kind of employment, trade unions and organisations of the working class have to take up the issues of legal recognition of gig workers as workers, of their rights such as fixed working hours, safe working conditions, minimum wages, security of jobs, social security, right to form unions, mechanisms for redressal of grievances, etc. The gig workers have to join hands with the rest of the working class and persist in their efforts to organize around the demand of recognition as workers and for their rights as workers.

 Rights won by gig workers in other countries

Through their persistent struggle, gig delivery workers and cab drivers, have secured some rights in certain countries.

Delivery drivers for a same-day delivery company called Dynamex in California, USA, have secured a change in California’s labour code.  Delivery workers employed by the company, whose performance and working hours are determined by the company, are now considered as employees rather than contract workers, and all the benefits meted out to a full employee of the company are supposed to be extended to the delivery workers as well.

In 2021, the U.K. Supreme Court ruled that Uber drivers must be treated as workers, and not as self-employed. This definition has been integrated into the U.K. Employment Rights Act. Gig workers in the UK are now classified as “workers,” in a category between employees and the self-employed. This secures them a minimum wage, paid holidays, retirement benefit plans, and health insurance.

In Indonesia, gig workers are entitled to accident, health, and death insurance. In Belgium, delivery workers of a company called Deliveroo have forced their owners to enter into negotiations with trade unions. In Canada gig workers have secured certain specific rights with regard to termination from their jobs.

Securing rights such as health care, adequate income and social security benefits for gig workers is an issue that has been raised by trade unions in the International Labour Organisation (ILO). So far, very few countries are reported to have implemented any measures to ensure these.

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