Independent workers in India are gaining legal status, but access to social security remains elusive

India has granted legal status to millions of gig workers and platforms under newly implemented labor laws, marking a milestone for the country’s delivery, ride-hailing and e-commerce industries – but with benefits unclear and platforms beginning to weigh their liabilities, access to social security remains elusive.

This recognition comes from the Social Security Act – one of the four labor laws passed by the Indian government entered into force On Friday – more than five years after Parliament sat for the first time Passed them in 2020. It is the only part of the new framework that addresses gig and platform workers, as the remaining three rules – covering pay, industrial relations and workplace safety – do not extend minimum income, employment protections or working conditions guarantees to this rapidly expanding workforce.

India has one of the world’s largest and fastest-growing gig economies, with industry estimates saying more than 12 million people deliver food, drive taxis, sort e-commerce packages, and perform other on-demand services for digital platforms. The sector has become a critical source of employment, especially for young workers and migrants excluded from formal labor markets, and is expected to expand further as companies expand logistics, retail and local delivery services.

Companies from Amazon and Walmart-owned Flipkart to Indian express delivery apps like Swiggy, Eternal’s Blinkit and Zepto, as well as ride-hailing companies including Uber, Ola and Rapido, rely on gig workers to run their businesses in the South Asian nation — the world’s second-largest internet and smartphone market after China. However, despite the support of some of India’s most valuable tech companies, most gig workers work outside traditional employment protections. They lack access to basic social security.

Newly implemented labor laws aim to change that, by defining gig and platform workers in the platform and requiring aggregators, such as food delivery and ride-hailing platforms, to contribute 1% to 2% of their annual revenue (up to a maximum of 5% of payments made to these workers) to a government-run social security fund. But the details remain murky: What specific benefits will actually be offered, how workers will be able to access them, how contributions will be tracked across multiple platforms, and when payments will begin all remain unclear, raising concerns that meaningful protections could take years before they are achieved.

the Social Security Law It creates a legal framework for gig workers to be covered under schemes like Employees’ State Insurance, Provident Fund and Government-backed insurance. However, the extent of these benefits – including eligibility, contribution levels and delivery mechanisms – remains unclear and will depend on future rules and scheme notifications.

A key part of the framework is the establishment of social security councils at the central and state levels, charged with designing and supervising social welfare schemes for gig and platform workers. The central council should include five representatives of freelancers and platforms and five representatives of aggregators, all nominated by the government, along with senior officials, experts and state representatives, according to the code. But there is little clarity about how decisions will be made, how much influence worker representatives will actually have, or who will ultimately control decisions about funding and benefit delivery.

“We have to wait and see what exactly the government has in mind when it comes to implementing the four rules, and what it hopes to do for gig workers,” said Balaji Parthasarathy, a professor at IIIT Bangalore and principal investigator of the Fairwork India Project. “We also have to see what countries translate on the ground.”

Parthasarathy pointed out that since labor policy in India is shared between the federal and state governments – listed “synchronized list” From the Indian Constitution – State governments are responsible for designing, notifying and administering various schemes necessary to make the Social Security Act workable for gig workers.

This raises the possibility of unequal access, as some countries move quickly to establish social security boards and roll out mechanisms, while others delay or deprioritize efforts due to political or financial constraints. Recent examples – such as Rajasthan Stalled legislation after its passage in 2023and the Karnataka Gig Workers Act, which was implemented soon after Cleansing the State Council – Emphasizing how worker protection may ultimately depend on where they live rather than on the law itself.

Platform companies have publicly welcomed the reform, but are still largely assessing what it will require of them. An Amazon India spokesperson told TechCrunch that the company supports the Indian government’s intent behind labor reform and is evaluating what changes it will need to introduce. A Zepto spokesperson said the company welcomes the new labor laws as “a big step towards clearer, simpler rules that protect workers while supporting the ease of doing business,” adding that the changes will help boost social security for its delivery partners without undermining the flexibility on which express trade operations depend.

Food delivery company Eternal, formerly known as Zomato, said on… Stock exchange deposit That the Social Security law is a step toward more uniform rules and that it does not expect the financial impact to threaten its business in the long term.

However, Aparajita Rana, partner at corporate law firm AZB & Partners, said the change “will naturally have a financial impact” on India’s e-commerce sector, where workers’ contributions are now formalised. It would also create new compliance obligations, requiring companies to ensure all workers in their networks are registered with the government-run fund, determine whether individuals are linked to multiple pools and how to avoid dual benefits, and create internal grievance mechanisms.

“While the law has the right intention, the structures of gig workers in India are quite new, and practical compliance challenges will arise as the law comes into force,” Rana told TechCrunch.

One of the biggest hurdles faced by freelance workers seeking benefits under the newly implemented law is registering on the Indian government’s website. Al-Sharam Electronic Portallaunched in 2021 as a national database of unorganized workers. The portal was hers More than 300,000 workers are registered on the platform As of the end of August, though, the government estimates India’s workforce to be around 10 million. Trade unions, including the Indian Federation of App-Based Transport Workers (IFAT), which has more than 70,000 members, are working to help gig workers register so they can access benefits.

Registering on the portal could mean losing wages for gig workers, as they would have to take time off to fill out the required details, said Ambika Tandon, a PhD candidate at the University of Cambridge and a member of the National Trade Union Center of Indian Trade Unions (CITU).

“These workers work 16 hours a day,” she told TechCrunch. “They don’t have time to go and register themselves on the government portal.”

CITU is also among the top ten Indian trade unions Calling for withdrawal for new labor laws, ahead of protests scheduled across the country on Wednesday.

Tandon pointed out that the benefits of registering with the E-Shram portal are not compelling for many gig workers, because the law does not address more pressing concerns such as fluctuation of earnings, suspension of accounts, and sudden termination of accounts — issues that workers say are far more important at the moment than access to insurance or provident fund benefits.

Labor unions often organize strikes to push platforms to address these concerns directly. However, such actions can disrupt all participants, including consumers, and expose workers to greater risk, as they do not receive their wages during a strike and may face termination for participating.

“Though the social security rules have now been put in place, we demand a minimum wage and an employer-employee relationship for gig and platform workers, which is yet to be decided by the government,” said Sheikh Salahuddin, founder president of the Telangana Gig and Platform Workers Union (TGPWU), which has over 10,000 members in the southern state of Telangana, and national general secretary of the IFAT. “We urge the government to obtain data from data aggregators and secure their cash contributions to the fund to start providing benefits to workers.”

There is a broader debate about Whether gig workers should be treated as employees – A question not addressed by the new labor laws. The Social Security Act defines gig and platform workers as a separate category, rather than giving them the rights and protections that come with employee status. In contrast, courts and regulators in markets such as UK, Spainand New Zealand It has moved toward recognizing platform workers as employees or “workers,” entitled to minimum wage, paid leave, and other benefits. In some US jurisdictions, regulators and courts have pushed for platform workers to be so They are treated as employees Or similarly protected workers, although there are many taxi and delivery drivers They remain classified as independent contractors.

“With this law, the Indian government has settled this debate by saying that these temporary workers do not fall within the scope of employment or other protections,” Tandon said.

The Indian Ministry of Labor did not respond to a request for comment.