Author: M. Aishwarya Lakshmi, a student at Vel Tech Rangarajan Dr.Sagunthala R&D Institute of Science and Technology
To the Point
India’s gig economy has rapidly evolved into a dominant pillar of its urban workforce. From food delivery executives and cab drivers to freelance digital marketers and personal care providers, millions of individuals now rely on flexible, task-based employment facilitated through digital platforms. Yet, despite their integral role in the everyday economy, gig workers remain largely excluded from the scope of labour protections enshrined in Indian law. These workers are neither classified as formal employees nor afforded the safeguards typically provided to traditional workers. Consequently, they face an array of vulnerabilities, including income instability, lack of health insurance, occupational risks, and an absence of social security. This article delves into the pressing legal ambiguities surrounding gig work in India, critically examines current regulatory frameworks, and offers a path toward reform that acknowledges the dignity and rights of this indispensable segment of the labour force.
Abstract
The exponential rise of gig and platform-based work in India has transformed the nature of employment. While offering flexibility and digital convenience, this shift has exposed significant legal and social gaps. The absence of a clear legal framework for gig workers has left them without fundamental rights or protections. This article critically evaluates the socio-legal status of gig workers in India, analysing statutory developments, judicial perspectives, and international practices. Drawing on data, policy reports, and comparative jurisprudence, it proposes a robust regulatory mechanism to ensure recognition, protection, and empowerment of gig workers as legitimate stakeholders in India’s economy.
Use of Legal Jargon
The article incorporates key legal terminology relevant to the discourse on gig work:
• Gig Worker: An individual engaged in short-term, flexible, and freelance jobs, often mediated by digital platforms.
• Platform Worker: A subset of gig workers who perform tasks facilitated by online platforms such as Zomato, Ola, Uber, or Urban Company.
• Contract for Service vs. Contract of Service: Distinction between independent contractors and employees, central to determining eligibility for labour law protections.
• Social Security: Statutory protections such as insurance, pension, and maternity benefits aimed at worker welfare.
• Algorithmic Management: The use of software systems by platforms to control worker activity, including assigning tasks, rating performance, and managing termination.
•Decent Work: According to the International Labour Organization (ILO), this refers to employment that ensures fair earnings, safe working conditions, access to basic social protections, and respect for rights at work.
• Labour Market Institutions: Bodies that enforce labour regulations and mediate employer-employee relationships.
The Proof
As reported by NITI Aayog in 2022, India had an estimated 7.7 million gig workers in 2020–21. This number is expected to rise significantly, reaching approximately 23.5 million by the year 2029–30. Gig workers contribute an estimated 1.25% to India’s GDP, a figure expected to rise as digital intermediation becomes more widespread.
Despite these contributions, gig workers lack access to essential protections such as fixed working hours, minimum wage, or insurance coverage. Their employment is governed by opaque contractual terms often skewed in favour of the platform. For example, a delivery worker may be terminated through automated deactivation without recourse to appeal.
The Code on Social Security, 2020, marked the first legislative effort to define “gig workers” and “platform workers.” However, it remains enabling in nature, offering few enforceable rights. Provisions related to welfare schemes and aggregator contributions are yet to be operationalized, and there is no mandate for minimum wage or safety standards.
Several empirical studies, including those published by the ILO and ASSOCHAM, reveal that gig workers frequently express dissatisfaction with unclear payment structures, limited access to complaint resolution mechanisms, and the opaque nature of algorithmic supervision that governs their tasks and ratings. Moreover, platform companies continue to insist on the classification of gig workers as independent contractors, thus evading obligations under standard labour law statutes.
Case Laws
1. People’s Union for Democratic Rights v. Union of India (1982 (3) SCC 235)
In this landmark judgment, the Supreme Court interpreted Article 23 of the Indian Constitution, which prohibits forced labour, to include situations where individuals are compelled to work in exploitative conditions due to economic compulsion. The Court ruled that even if a labour arrangement is governed by a contract, it may still amount to forced labour if it lacks basic statutory safeguards such as minimum wages, safety, and social protection. This precedent is significant for gig workers, who often operate under contracts that deny them essential labour protections, making their situation analogous to “economic coercion.” “This decision established a constitutional basis for viewing exploitative conditions in digital labour arrangements as potential violations of the fundamental rights enshrined in the Constitution.”
2. Uber BV v Aslam [2021] UKSC 5 (19 February 2021)
This ruling significantly reshaped the legal understanding of employment relationships within the gig economy. The UK Supreme Court held that Uber drivers could not be considered independent contractors, as Uber exercised substantial control over their working conditions, including fare setting, route selection, and performance evaluation. The court ruled that the drivers were “workers” under UK labour law — an intermediate category between employee and self-employed — thereby granting those rights such as the national minimum wage, holiday pay, and rest breaks. The judgment emphasised the reality of the relationship over the contractual label, challenging the prevailing classification in platform work. This ruling has had ripple effects globally in strengthening the case for gig worker rights.
3. Klooger v Foodora Australia Pty Ltd (2018) FWC 6836
The Australian Fair Work Commission, in this decision, undertook a detailed examination of the employment classification of a food delivery rider. The Commission found that the rider was not a truly independent contractor but an employee of the Foodora platform, based on factors like regularity of work, control by the company, and lack of bargaining power. The worker was therefore entitled to protections under Australia’s Fair Work Act, including unfair dismissal remedies. This case is pivotal in understanding how substance-over-form reasoning is applied to classify gig workers based on actual work conditions rather than contractual designations.
4. Zomato Partner Strikes (India, 2022)
Though not adjudicated in court, the Zomato delivery partner strikes across several Indian cities brought public and policy focus to the working conditions of gig workers. Workers protested declining per-delivery pay, non-transparent incentive structures, and sudden deactivation without explanation — practices symptomatic of algorithmic control without accountability. These events underscored the absence of formal grievance redressal mechanisms, a key demand of gig workers. While lacking judicial intervention, these protests served as real-world evidence of the legal vacuum gig workers operate in and the need for statutory recognition and protection.
Conclusion
India’s digital growth has created a new kind of workforce that operates differently from traditional jobs but plays a major role in the economy. However, since gig workers are not officially recognized under existing labour laws, they continue to face ongoing unfairness and lack of protection. It creates a class of workers who bear the responsibilities of employment without its corresponding rights.
There is a pressing need for a statutory regime tailored to the realities of gig work. This could include:
Enforceable minimum wage standards
Platform contributions to social security funds
Mandatory health and accident insurance
Protection from arbitrary termination
Creation of grievance redressal mechanisms
Legal recognition of collective bargaining rights
The proposed reforms should be informed by a participatory process involving workers, platforms, and regulatory bodies. Without timely intervention, the gig economy risks becoming a vehicle for digital-age exploitation rather than empowerment.
FAQS
1. Who qualifies as a gig worker in India?
A gig worker is someone engaged in temporary, task-based, or freelance employment, often facilitated through a digital platform, without a traditional employer-employee relationship.
2. Are gig workers covered under Indian labour laws?
Currently, gig workers are not covered under traditional labour laws like the Industrial Disputes Act or the Minimum Wages Act. They are, however, mentioned in the Code on Social Security, 2020, which remains largely unimplemented.
3. What are the main challenges encountered by gig workers?
Gig workers often contend with unpredictable and insufficient earnings, lack access to formal social security systems, face significant occupational hazards, and are subject to algorithmic surveillance and control. Additionally, there is a notable absence of structured grievance redressal mechanisms, leaving them without effective recourse in cases of unfair treatment or termination.
4. Is there judicial recognition of gig workers as employees in India?
As of now, Indian courts have not issued a conclusive judgment affirming the status of gig workers as formal employees. Nonetheless, the growing number of legal challenges and worker protests has intensified the policy and judicial discourse on the need to re-evaluate their classification within the existing legal framework.
5. What reforms are recommended for improving gig workers’ rights?
Reforms include statutory recognition, minimum wage laws, health insurance mandates, aggregator contributions to welfare funds, and the right to form unions or associations.
