A recent report released earlier this year, based on a survey conducted across eight cities in the country, revealed that over 83% of cab drivers worked for over 10 hours a day, with 99.3% and 98.5% of the respondents reporting physical and mental health issues. This highlights the need to bring in reforms to address the concerns of gig workers. First enacted in September 2020, the Code on Social Security, 2020, contemplates the framing of social security schemes for the welfare of gig and platform workers but the same was not brought into force.

It can be said that the State of Karnataka (‘State’) has taken inspiration from the State of Rajasthan, which brought in a similar legislation in September of last year. However, the draft Bill differs from the Rajasthan Platform Based Gig Workers (Registration and Welfare) Act, 2023, on many counts. Some of the prominent differences include the delineation of services provided by aggregators, the requirement for certain aggregators (with more than 50 platform workers registered on their platform) to constitute an Internal Dispute Resolution Committee for resolution of specified disputes, and, perhaps the most important of all, the emphasis laid on transparency in automated processes.

Further, the State Government of Jharkhand introduced a draft Bill to enhance the rights and welfare of gig workers, which was opened for public comments on July 1, 2024.[3] This Bill also aims to establish a comprehensive framework for social security, minimum remuneration and occupational health and safety for gig workers.

Karnataka Platform Based Gig Workers (Social Security and Welfare) Bill, 2024 – Applicability

As the short title of the draft Bill suggests, once enacted, it will apply to platform-based gig workers. The applicability extends to aggregators providing Schedule-I services, which are as follows:

• Ride-sharing services
• Food and grocery delivery services
• Logistics services
• E-marketplace (both marketplace and inventory model) for the wholesale or retail sale of goods and/ or services Business to Business (B2B)/ Business to Consumer (B2C)
• Professional services provider
• Healthcare
• Travel and hospitality
• Content and media services

These services have been extracted from the Seventh Schedule of the Code on Social Security, 2020. The Seventh Schedule of the Code provides a classification of aggregators the contribution payable by whom will be at a rate ranging between 1% to 2% of the annual turnover, provided that it does not exceed 5% of the amount payable to gig workers and platform workers. This rate will be notified by the Central Government. However, the classification under the Seventh Schedule of the Code is broader considering that the last item, ‘Any other goods and services provider platform’ has not been included in the draft Bill.

Automated Monitoring and Decision Making Systems

Notably, a platform has been defined as an “arrangement providing a service through electronic means, at the request of a recipient of the service, involving the organization of work performed by individuals at a certain location in return for payment, and involving the use of automated monitoring and decision making systems”. This definition is unique in the sense that it requires the arrangement to involve the use of “automated monitoring and decision making systems”, an aspect not found in the Code on Social Security, 2020, or the Rajasthan Platform Based Gig Workers (Registration and Welfare) Act, 2023.

On receiving a request from a platform-based gig worker, the aggregators would be required to share information on the main parameters for determining the allocation of work, distribution of work, assessment of work and the grounds for denial of work. Likewise, information must also be provided on the rating system, categorisation of gig workers, personal data of the gig worker available with the aggregator, and any other information as may be prescribed by the State Government.

The gig workers have to be made aware of the procedure to be followed for obtaining information pertaining to the automated monitoring and decision-making systems employed by the aggregator having an impact on their working conditions, including fares, earnings, customer feedback and allied information. Additionally, the draft Bill calls for aggregators to take steps to make sure that such systems do not discriminate on the basis of religion, race, caste, gender, or place of birth.

These requirements will certainly ensure transparency, enabling gig workers to access factors affecting their working conditions which were hitherto obscure. Armed with such information, gig workers can change their approach and make informed decisions. They would also be able to challenge automated decisions on grounds such as due process violations, inaccuracies, unfairness, discrimination, etc.

Key Provisions

Registration and Welfare Board

• The draft Bill envisages setting up of the Karnataka Gig Workers Welfare Board to be tasked with ensuring the registration of gig workers and aggregators, implementing the benefits as notified by the State Government, etc.
• All platform-based gig workers to have the right to be registered with the State Government, have access to general and specific social security schemes based on their contributions, etc.
• On being onboarded or registered with a platform, the platform-based gig workers have to be electronically registered by the Board within 60 days.
• Aggregators will be required to register with and provide to the Board its database of gig workers within 60 days of the commencement of the Act. Any changes in such data also need to be intimated to the Board.

Social Security, Welfare and Health

• Gig workers have to be informed of any change in the terms of the contract at least 14 days in advance. The language has to be simple and easily comprehensible. Sector-specific guidelines for contracts would be issued by the State Government from time to time.
• A gig worker cannot be terminated by an aggregator without providing valid reasons in writing and 14 days prior notice.
• Platform-based gig workers to be compensated at least on a weekly basis.
• Aggregators to comply with the sector-specific occupational safety and health standards as may be prescribed.
• A human point of contact to be nominated or physical spaces to be maintained so that platform-based gig workers can seek clarifications under provisions of the Act.
• The contributions made by the platform-based gig workers, the welfare fee collected from aggregators, the sums received as grant-in-aid from the government, and so on will form part of the Karnataka Gig Workers’ Social Security and Welfare Fund.
• All payments generated on platforms would be mapped onto a Central Transaction Information and Management System (CTIMS). This system will be administered by the State Government and monitored by the Board. The payments made to gig workers and the welfare fee deposited will also be recorded on CTIMS.

Dispute Resolution and Other Provisions

• In case of grievances with respect to entitlements, payments or other benefits under the Act, a petition can be made through a web portal or filed before a grievance redressal officer. An appeal against the order of the officer can be filed before the Appellate Authority within 90 days.
• Aggregators with more than 50 platform workers registered on their platform to set up an Internal Dispute Resolution Committee for the resolution of disputes concerning termination without notice, failure to compensate on time and other disputes enumerated under Schedule II.
• Penalties leviable on aggregators range from INR 5,000 to 100,000. A further penalty of up to INR 5,000 for each day will apply in case of continued contraventions.
• Cognizance of an offence under the Act cannot be taken by a court inferior to that of a Metropolitan Magistrate or a Judicial Magistrate of the first class.
• Quarterly reports to be submitted by aggregators.
• State Government to be empowered to conduct inspections and reviews to check compliance with the provisions of the Act and rules made thereunder.

Implications and Future Steps

The draft bill is a significant step towards recognizing and formalizing the gig economy providing much-needed protection and benefits to the gig workforce. By addressing issues of transparency, health and fair treatment, the Bill aims to create a more equitable working environment for those employed in this sector.

The draft will be tabled in the upcoming assembly session for further discussion and approval.