Centre Set to Launch Social Security Policy for Gig Workers Soon

The Indian government is poised to expedite the implementation of social security benefits for gig workers in unorganised sectors, as reported by The Economic Times. This move comes in light of recent initiatives by several states to adopt similar policies within their local frameworks, demonstrating a growing commitment to protect the rights and welfare of temporary and freelance workers.

Ministry’s Engagement with Gig Economy Aggregators

The Ministry of Labour and Employment is actively engaging with aggregators in the digital gig economy, encouraging them to prepare for the extension of social security benefits to these workers. A senior government official mentioned that various strategies for implementing these benefits are under evaluation, with a definitive decision anticipated shortly.

Streamlining Registration for Gig Workers

To facilitate this rollout, the Labour Ministry intends to instruct states to accelerate the registration process for platform workers on the e-Shram portal. This initiative is designed to create a comprehensive database, ensuring a seamless nationwide deployment of the social security benefits scheme.

State-Level Initiatives in Focus

Several states, including Karnataka, Telangana, and Rajasthan, have already initiated or are in the process of formulating policies that provide health insurance and additional benefits to local gig workers. According to a report by NITI Aayog, the number of gig workers in India, which stood at 7.7 million in 2020-21, is projected to increase to 23.5 million by the year 2029-30. This substantial growth highlights the urgent need for adequate social security measures in this rapidly expanding workforce.

Draft Policy Highlights

Under the draft policy, which has been under discussion for over two years, aggregators are expected to contribute 1-2% of their revenue to a social security fund, which the government will match. This fund will be allocated to provide health insurance, income security, pensions, unemployment benefits, and sickness and injury coverage, as well as maternity benefits, primarily through the Employees’ State Insurance Corporation.

Precedent for Legislative Flexibility

In 2020, the Labour Ministry set a significant precedent by notifying provisions related to an advisory board under the Code on Wages. This indicates that certain legislative sections can be enacted prior to the full implementation of the Code, aligning with the Bharatiya Janata Party’s election manifesto commitment to register gig and platform workers while extending social security benefits to them.

Who are Gig Workers?

Gig workers are individuals who engage in short-term, flexible jobs or freelance work rather than being employed in traditional, long-term positions. They often work through digital platforms or apps, offering their services on demand. This type of work has become increasingly common with the rise of the gig economy, which encompasses various sectors and industries.

Key Characteristics of Gig Workers:

1. Flexibility: Gig workers can choose when, where, and how much they work, allowing for a more adaptable work-life balance.

2. Diverse Roles: They can be found in numerous fields, including:

   • Ridesharing (e.g., Uber, Lyft)

   • Food delivery (e.g., DoorDash, Zomato)

   • Freelance jobs (e.g., graphic design, writing, programming)

   • Task-based services (e.g., cleaning, handyman services)

3. Short-Term Engagements: Gig work typically involves temporary or project-based engagements rather than long-term contracts.

4. Independent Status: Gig workers are usually classified as independent contractors rather than employees, which can affect their access to benefits such as health insurance, retirement plans, and unemployment insurance.

5. Digital Platforms: Many gig workers find opportunities through online platforms that connect them with clients or customers, making it easier to find and manage work.

Benefits and Challenges:

• Benefits:

  • Autonomy: They have greater control over their work schedules and projects.

  • Variety: Gig workers can take on different types of jobs, allowing for diverse experiences.

• Challenges:

  • Lack of Benefits: They often do not receive health insurance, paid leave, or retirement benefits that traditional employees enjoy.

  • Income Instability: Their income can be unpredictable, depending on demand for their services.

  • Limited Worker Protections: Gig workers may not have the same legal protections as employees, including rights to minimum wage or overtime pay.

Growing Importance:

As the gig economy expands, gig workers are increasingly recognized for their contributions to the labor market. Governments and organizations are beginning to explore ways to provide social security benefits and protections tailored to this unique workforce, addressing their specific needs and challenges.

Conclusion

As the Centre moves forward with these plans, the focus remains on ensuring that gig workers receive the social security and protection they deserve. This initiative not only reflects the government's responsiveness to the needs of an evolving workforce but also underscores the importance of social safety nets in fostering an equitable labor market.