By Rishi G Kannan

Introduction 

“A problem for the worker spells a problem for the nation”

India is on the threshold of global prominence , with astounding development on the economic and geopolitical landscape. One of the important factors that pushed our economy into prosperity was our developing workforce. But with the advent of the COVID-19 pandemic and the resultant employment downturn, there was a sharp shift of the work-thought process, from rigidity to flexibility, leading to the flourish of a new “Gig economy”.

The Gig Economy is reshaping the global labor market, fostering new ways of working while challenging the traditional structure. In a basic sense, the Gig economy uses digital platforms to connect workers with employers or clients.

What is the Gig Economy? A Global view

“Platform workers emerged as superheroes who kept neighborhoods connected, and ensured the supply of essential goods and movement of essential personnel” (ET Bureau, 2024)

The Gig economy can be explained as a short-term, flexible and, often project-based work with increasing amounts of short contracts and freelance works. It encompasses different industries like transportation, food preparation and delivery, and even programming and writing. (Charlton, 2024)

In 2024, the gig economy had a market size of $556.7 billion, and it is expected to triple by 2032, up to $1847 billion. While gaining flexibility and independence, gig workers have no job security, which makes it a conundrum for the future, as the world is moving to a place of convenience. (Charlton, 2024)

The Gig economy in the Indian perspective

India, with one of the largest gig workforces in the world, and a fast-developing digital infrastructure is poised to take the industry by storm. It is estimated that there were 77 lakh gig workers in 2020-21, forming 1.5% of the total workforce in India. The gig workforce is expected to expand to 2.35 crore workers by 2029-30, which is expected to form 4.1% of the total workforce of India. (NITI Aayog, 2022)

The Indian Government has split Gig economy workers into 2 categories: Platform workers and non-platform workers. A platform worker is a worker who works for companies that have online platforms, such as Amazon, Swiggy and Zomato’s delivery workers. Non-Platform workers are workers who do not participate in such platforms, examples including construction workers and non-technology temporary workers. (Sharma, 2024)

Workers in Gig economy must not be blindly lumped with the informal sector, as they are given some specific advantages and perks that are not present in the informal sector, but not in any way equal to the Formal sector.

Advantages of the Gig Landscape

 The benefits of the Gig and platform economy belied the overall problems contained in the system.

  1. Digital platforms like Swiggy and Zepto in the Indian Gig workspace, have enhanced consumer convenience by offering several services like food delivery, ride-hailing and online freelancing. This shift has created a new section of employment, supported local businesses and improved essential services during a more difficult time like that of the pandemic.
  2. Jobs in the Gig economy often give opportunities to university students, home-makers and even full-time workers in search of a supplemental income. These people can continue pursuing their other commitments with the freedom of a flexible schedule while making extra income to supplement their essential living expenses. (Charlton, 2024)
  3. The incredible hidden value that India’s gig labor possesses, cannot be understated. India has the fifth largest population of gig economy workers, and by 2030, this could improve to the third place. By 2030, there is an estimation that India’s workers could rise by up to 200%, and contribute to around 2.5% of its GDP. (Roy, Gobinda, Avinash, 2020)
  4. An increasing demographic that has seen a positive impact due to gig work are women. A survey done on 84 platform workers from different platforms interviewed on the impact of gig work on their lives has shown that women take up these jobs after their education and marriage because of the freedom it provides from the rigors of regular office jobs. (Sharma, 2024)
  5. 80% of the women workers are in the age bracket between 26 and 45, with 61% of the total respondents to the case study having completed their high school, showing a new interest women have in the field. Several of these participants also have dependents, including children and elders, thus necessitating a flexible work schedule. (Raman, Ramachandran, Sindhu, 2021)
  6. The Gig and Platform sector has low-entry barriers for entry into the workforce and hence holds enormous potential for job creation and unemployment reduction in India. Better income opportunities are created to informal and non-platform workers with systematically low wages, thus bringing them to a level closer to formal employees. (ET Bureau, 2024)

What are the challenges faced by workers in this system?

While the Gig economy has provided a buffer for the protection of employment during the COVID-19 pandemic, and bringing a substantial improvement in India’s economy, the problems faced by the employees under harsh aggregators, management and the continuing neglect by the law must not be ignored.

Questions about the sustainability of the Gig move were highly prevalent, and even though it is a growing segment with new economic benefits and productivity, the flip side results in a lack of security. Most employers do not even provide basic health insurance and paid time off , resulting in an abysmal work-life balance. (Charlton, 2024)

Internet access has become ubiquitous for most Gig employers, or aggregators, thus dividing the people who suffer from digital illiteracy from the workforce itself. The uncertain employment status and increased stress and pressure coming from a deadline-filled job that is dependent on the goodwill of the employers and consumers over actual rules, make gig work one of the riskiest jobs to hold. (NITI Aayog, 2022)

Incidents of workplace inconsistencies have begun rising at several places. For instance, in Bengaluru’s Urban Company, Women gig workers went on strike demanding a changed in the company’s new terms of reference, with even the Gig and Platform Services Workers Union (GOPSWU), part of the Indian Federation of App-Based Transport workers, condemning the new policies. Workers faced arbitrary suspensions and pay cuts, with women being the most affected. (BHRRC, 2024)

Jobs like delivery work in Swiggy and driving in a transportation company like Ola can make a worker dependent on an algorithm that allots work based on arbitrary criteria like ratings. These kinds of ratings can lead to increased pressure, fewer tasks and even suspension due to a few bad reviews, taking a great toll on workers’ physical and mental health. The excessively long and random working hours under a gig system can also lead to sleep dysfunction and anxiety, as there is no question that long weekly hours are often correlated worse intellectual and mental health, greater anxiety and sleep disorders. (Afonso, Fonseca and Pires, 2017)

Global Improvement and India’s contribution to revitalizing the Gig Industry

           In the UK, a monumental decision occurred in 2021, when the Supreme Court classified Uber drivers as Workers, not self-employed, which was used as a disguise to avoid providing the necessary benefits to workers. (Naughton, 2021)

Similarly, in November 2024, Drivers for ride-hailing and food delivery startup Bolt won a case to be legally recognized as “workers”, entitling them to Holiday pay and the minimum wage. These incidents have been a stepping stone for Gig workers to be recognized as part of the formal workforce, and allowed lawmakers to design laws that allow for the dignified livelihood of these workers. (Reuters, 2024)

But India’s own internal growth in this sphere has been different, due to the different needs and corrections required in the system. The All-India Gig Workers Union, in their response to the NITI Aayog Report “India’s Booming Gig and Platform economy”, said that robust regulatory mechanisms and worker protections must be extended to the gig economy and other forms of perennial employment. Also speaking on the issue of women empowerment in the platform, while there is a general acceptance of Platform work as a panacea for women, more insight into the vulnerabilities women face through workplace exploitation must also be explained. Considering these vulnerabilities, there must be legal and regulatory measures enabling women to participate in the gig economy more fully – for example, creches, sexual harassment prevention measures, equal wages and proper hours and working conditions. (Shukla, 2024)

Therefore, the Indian Government, which has always been precognitive and effective in implementing solutions to the problems affecting the Gig workers, has begun implementing solutions through ingenious policymaking and support from global incidents that allowed for a new standard to be set in the economy.

Government Initiatives for Gig workers:

In 2019-20, the Union Road Transport Ministry issued fresh guidelines for motor vehicles for motor vehicle aggregators like Ola and Uber that regulates working conditions for the platform drivers, with new rules stating that drivers should receive 80% of the fare from each ride, with 20% to the aggregator. Drivers were permitted only 12 hours of work a day. (Singh, 2020)\

An important milestone in the development of India’s workforce, including the gig workers, was the Code on Social Security 2020. This allowed for 29 Central Labor Laws to be essentially simplified and compartmentalized into 4 broad codes including Wages and Social Security. In this code, the term “Gig worker” was defined, stopping any ambiguity or confusion in the term. It also allowed for the creation of a new National Social Security Scheme, which performs the function of recommending suitable schemes for different sections of unorganized workers and gig workers, to the Central Government. There are a few gaps in the Code, like a lack of specific protections to Gig and Platform workers, but a strong base like this could very well shape the Labor policy of India for years to come. (CSSA, 2020)

The Rajasthan Platform Based Gig Workers (Registration and Welfare) Act 2023, under the present Rajasthan Government, is a new Segway for better implementation of rules and regulations to improve the working conditions of gig workers. The bill mandates that all gig workers register themselves with the State Government to bring them under the ambit of Labor regulations and allow the State to maintain a comprehensive database of all operating gig workers in Rajasthan. Each worker receives a unique ID that allows them to access a range of social security schemes including Health insurance, accident coverage and other complementary measures, boosting the existing benefits given under the Code on Social Security 2020. (RPBGWA, 2023)

The Karnataka Platform based Gig workers (Social Security and Welfare Bill, 2024) brought new and innovative measures like a new Gig Workers Welfare Board for all gig workers. This Act also improves security of employment for gig workers by giving a clear contractual agreement between the aggregator and the worker with an exhaustive list of grounds for termination of the contract and a 14-day notice period for termination with written reasons. It has innovative grievance mechanisms and requires simple language in their contracts. While both Rajasthan and Karnataka’s Acts do not solve the fundamental issue of the classification of gig workers as independent contractors rather than employees, it has provided the path forward for the Government to take a more national step towards integration of the gig workers. (Government of Karnataka, 2024)

The Union Ministry of Labor and Employment is drafting a new national law to incorporate gig workers into social security schemes, offering benefits such as health insurance and retirement savings. The government is also revising the definitions of gig and migrant workers to make them more inclusive and reflective of current employment realities. (PIB, 2024)

To conclude this section, another essential program by the Ministry of Labor and Employment was the E-Shram portal, which is the “One-Stop-Solution” for the integration of different social security schemes and welfare schemes at a single portal for unorganized workers. Presently, when registered, it gives the worker access to an Accidental Insurance cover of Rs 2 lakhs, allowing poorer workers to avail health insurance without unnecessary financial peril. (NITI Aayog, 2023)

Recommendations for a Sustainable Gig Economy

To summarize the above facts, the future of Gig work is dependent on the work of the Government, through legal reforms that can redefine gig workers as employees under Indian Labor laws to provide unrestricted access to basic features of employment like minimum wage, Employee Provident Funds, Women Safety and Empowerment. (Joshi, 2023)

            Implementing Training programs for new skill development can enhance income prospects for workers, while use of digital e-Governance platforms like CSCs or Common Service Centres can allow for awareness of digital literacy to every nook and corner of the country. (CSC, 2025)

Conclusion

The Gig system can be easily vilified by the bad decisions and mistakes of the past, but one must realize that India’s Gig workers have huge potential in providing meaningful employment to unemployed as well as struggling classes of people. The government has the tools and the foresight required to improve the system, and has already begun fine-tuning laws to better provide the necessary services to the people. The proper implementation and regulation of such an important system is a must to reach its true potential as a part of India’s growth into a World Leader.

Citations

  1. Afonso P.; Fonseca, M.; Pires, J. F. 2017. “Impact of working hours on sleep and mental health”, in Journal of Occupational Medicine, Vol. 67, No. 5, pp. 377– 382.
  • Agarwal, Priyanshu and Bharti Institute of Public Policy. “India’s Gig Economy: Challenges, Opportunities and the Future.” ISB, 3 Sept. 2024, blogs.isb.edu/bhartiinstitute/2024/09/03/indias-gig-economy-challenges-opportunities-the-future/#:~:text=The%20gig%20sector%20faces%20challenges,do%20not%20cover%20gig%20workers. Accessed 7 Jan. 2025.
  • BHRRC., “India: Urban Co. Women Gig Workers Protest Against ‘Horrific’ Work Conditions, Work Hours and Work Targets.” Business & Human Rights Resource Centre, 24 June 2024, www.business-humanrights.org/en/latest-news/india-urban-companys-gig-workers-protest-against-horrific-work-conditions-work-hours-and-work-targets.
  • Charlton, Emma. “What Is the Gig Economy and What’s the Deal for Gig Workers?” World Economic Forum, 22 Nov. 2024, www.weforum.org/stories/2024/11/what-gig-economy-workers/#:~:text=The%20gig%20economy%20uses%20digital,benefits%20of%20productivity%20and%20employment. Accessed 8 Jan. 2025.
  • CSC., Ministry of Electronics and Information Technology. “Common Service Centres.” CSC, csc.gov.in. Accessed 8 Jan. 2025.
  • Dinesh, Radhika, and Tathya Sarkar. “Workers’ Rights in Gig Economy – Legal Framework and Challenges.” Manupatra, 12 Aug. 2024, articles.manupatra.com/article-details/WORKERS-RIGHTS-IN-GIG-ECONOMY-LEGAL-FRAMEWORK-AND-CHALLENGES#:~:text=Lack%20of%20Legal%20Protection%20&%20Social,retirement%20benefits,%20and%20paid%20leave. Accessed 7 Jan. 2025.
  • ET Bureau. “Gig Workers Are Super Heroes Who Keep Neighbourhoods Connected.” The Economic Times, 8 Apr. 2020, economictimes.indiatimes.com/small-biz/startups/newsbuzz/gig-workers-are-super-heroes-who-keep-neighbourhoods-connected/articleshow/75038808.cms?from=mdr.

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