Article 15: Analysing The Position Of Platform Based Workers: Advocating

Vol. I, Issue I (2026) · Article 15 · Track: Employment Rights & Social Security

Analysing The Position Of Platform Based Workers: Advocating For Enhanced Rights

Anandita Anand and Anandita Srivastava

Keywords: Platform-based workers, social security, employer-employee relationship, Platform Work Directive, dependant contractor.

Abstract. The terms ‘platform workers’, ‘gig workers’, etc., are often used to describe non-traditional work arrangements where the nature of work is short term, and mostly demand driven, hence falling to meet the classical employment criteria. Gig workers form a wider group of workers engaged in such short-term contracts, and platform based workers are a subset of gig workers who provide services via platforms. In the digital world this is mostly carried out via online platforms and hence, the interchangeable use of these terms. In this article, the authors have focued specifically on the case of platform-based workers. The use of the term gig hereinafter is also with reference to the smaller subset of platform-based work and not the wider, and more general interpretation of gig. The flexibility offered by gig economy makes it more accessible and lucrative for a large group of people who, due to the strict and rigid requirements of traditional economy, are not able to be a part of it. For instance, the choice regarding the number of working hours, and the location of work, provides married women, single mothers, students, part time workers, and many others the opportunity to work as per their convenience. The appeal of the gig economy can be understood from the data furnished by NITI Aayog in its 2022 policy brief, where it was found that almost 77 lakh people were engaged in gig economy in the year 2020-2021, and, this number is estimated to reach 2.35 crores by 2030. This transition in the economy which started out as a boon in the economy and a relief from the existing employment structure, has on some occasions been found to be more demanding that traditional employment arrangement. With each passing year as the number of people engaging in platform-based work is rising, the amount of people getting affected by the rigorous work culture in gig economy is also increasing. This has given rise to a situation where it is the need of the hour to ensure some form of protection is accorded to platform workers from such exploitative work environment. Since the nature of the work carried on by such platform based workers is very different from the prevailing understanding of work carried on by employees in a traditional employment setting, these workers are often referred to as partners, contractors, etc, to keep them outside the scope of existing employment laws, hence, they are not provided with the benefits that are legally conferred upon employees including social security. Countries, including India have tried to solve this problem by taking various measures.

In India, steps have been taken both at the central and state level to extend some sort of protection to gig workers. At the national level, the Social Security Code of 2020 defined gig and platform workers and had some measures to protect them. At the state level, several legislations have been enacted, with the most recent development in this regard being the Karnataka Platform-based Gig Workers (Social Security and Welfare) Bill, 2024, released by the Labour Department of Karnataka in June 2024.

Internationally, dialogues and discussions the matter of rights of platform has been raised on a number of occasions, especially after COVID19. Recently the European Union has also come up with a directive to provide such protection termed as the “Platform Work Directive” which provides for the existence of a rebuttable presumption of the status of employment of platform based workers. While many countries have adopted this approach, there are others, including India, which have categorized gig workers into a different category and have conferred certain benefits upon them selectively.

In this article, the authors seek to critically analyse the steps taken to protect platform based workers in India. We also analyse the two approaches taken internationally and comment on their efficacy and practicality. We have finally concluded with suggestions and recommendations to enhance social security of platform based workers.

Keywords: Platform-based workers, social security, employer-employee relationship, Platform Work Directive, dependant contractor.

Introduction

The terms ‘platform work’ and ‘platform worker’ have been defined in the Social Security Code of 2020. As per the Code, a work arrangement which is outside the scope of a traditional employer--employee relationship and where organisations or individuals use an online platform to access other organisations or individuals to solve specific problems or to provide specific services is known as platform work. Individuals who participate in such arrangements qualify as platform workers.

While the term ‘platform workers’ is often used interchangeably with ‘gig workers’, the latter is a very broad term encompassing the former. Gig economy is an evolved work arrangement where services are availed from the workers on a short-term contractual term, unlike the traditional employee-employer relationship. In the digital world this is mostly carried out via online platforms and hence, the interchangeable use of these terms. Arguably, having a platform provides the opportunity to formalize the gig economy. In this article, the focus of the authors is specifically on the rights of platform based workers. The terms gig economy used hereafter would be to describe platform-based gig workers.

Besides the evolving nature of economy and constant digitization, one of the reasons behind people opting for platform-based work is the flexible nature of such commitments. Online platforms provide workers with more choice and flexibility in terms of the number of hours they put in and the place of work. However, recent trends show a different picture. A nation-wide survey conducted by a Delhi-based NGO, Janpahal highlighted certain grave problems faced by gig workers like- long hours, lack of regular income, urgency to meet delivery targets, absence of health insurance and other social security benefits, carrying excess weight, etc—all of which affect their physical and mental wellness. As per the results of the survey, it was found that gig workers work on average for eight hours a day, which is almost at par with the hours put in by traditional employees. Generally, given the unconventional nature of gig economy, platforms often treat gig workers as independent contractors, by terming them as ‘agents’, ‘partners’, etc. This is done to avoid the responsibilities that the law places on an employer in a traditional employer-employee set up.

Over the years with the burgeoning of platforms and the corresponding lack of employment opportunities in skilled market, there has been a huge influx of people in gig economy. As per NITI Aayog, there were almost 77 lakh people engaged in gig economy in the year 2020-2021, and, this number is estimated to reach 2.35 crores by 2030. Given the large number of people moving towards platform based employment, it becomes essential for the legislature to take certain steps to ensure the welfare of such workers.

At its core this problem revolves around the question whether platform based workers are ‘employees’ entitled to benefits available in a traditional employer-employee set-up or are they really independent contractors as espoused by platform owners. This analysis paves way for further discussion on whether the existing provisions for the benefit of employees must be extended to gig workers to improve their work condition, or whether, due to the evolving nature of the platform based economy, it becomes essential to come up with separate safeguards for gig workers different from those available to traditional employees.

In this article, we have analyzed the different approaches possible to regulate gig economy based on the steps taken by nations across the world and in India to for the protection of gig workers. Further, we have concluded with the solution which in our opinion is the ideal way to solve this problem.

Position of Gig Workers in India

Over the years, steps have been taken to regulate gig economy and protect the rights of gig workers. Some of the significant developments in this regard have been discussed here.

Social Security Code of 2020:

The Central government in 2020 came out with Labour codes to replace the existing outdated labour statues. In the Social Security Code, the legislature categorically defined terms like gig workers, platform workers, etc., to extend certain benefits in express terms to gig and platform workers. The code provides for the formation of National Social Security Board which would be vested with the power to come up with beneficial schemes for different categories of gig, unorganised, and platform workers.

Further, chapter IX of the Code deals in detail with the social security of unorganised workers, gig workers, and platform workers. It provides the central government the power to make schemes for the welfare of gig and platform workers on matters relating to education, health, insurance, old-age pension, etc. For these beneficial schemes, the Code provides that contribution must also be made by the ‘aggregators’ or the platforms that facilitate the work by gig workers. This contribution must be between 1-2% of the annual turnover of the aggregator but not more than 5% of the amount payable to gig workers.

While the move made by the legislature to recognise the right of gig and platform workers and provide social security is welcome, the Code is yet to be enforced and clearly lacks on a number of grounds. First, it vests the power solely with the central government to come up with schemes for the welfare of gig and platform workers. Secondly, it places gig workers and unorganised workers on the same pedestal, but the vast field of gig economy and the kinds of work it covers within its ambit are not always unorganised. The level of organisation, formality in a gig econmy is not set; it varies from field to field. Thirdly, it is only in the Social Security Code that gig and platform workers have been recognised. Many stakeholders and scholars believe that social security for gig workers is not enough. There is a need to go beyond security and ensure that the flexibility which was once promised to the workers is not taken away from them.

Rajasthan Platform Based Gig Workers (Registration and Welfare) Act 2023:

The state legislature is in line with the Central Code. The Act’s definition of a “gig worker” encompasses those who engage in work or perform services and get compensation for them outside of the conventional employer-employee relationship. Any individual who works on a contract that results in a specific rate of payment, based on the terms and conditions written down in such a contract, encompasses all piece-rate labour within the Act’s purview of gig workers.

It provides for creation of the Rajasthan Platform Based Gig Workers Welfare Board to further ensure the welfare of gig workers. The Board will oversee and manage the Central Transaction Information and Management System, which would house all payments made on platforms, to keep track of information regarding commission charged, GST deducted, welfare cess collected, deducted, spent, etc from the gig workers. The Act also provides for mandatory registration of the platform-based gig workers, and extends several rights to them including the right to bring complaints about their rights, payments, and other benefits.

Karnataka Platform-based Gig Workers (Social Security and Welfare) Bill, 2024

The Bill deals with aggregator firms’ capricious terminations due to low customer ratings and their incapacity to maintain a predetermined response rate to service requests. It demands access to social security programs as periodically announced by the state government, a welfare board established with funding from the aggregator company, the state, and the federal government, and a notice period of fourteen days given by the aggregator outlining the grounds for termination.

But the Bill doesn’t go far enough in defining gig workers’ employment status. “A person who performs work or participates in a work arrangement that results in a given rate of payment, based on terms and conditions laid down in such contract,” according to the Bill, is classified as a gig worker.

The phrase “work arrangement” is ambiguous since it leaves room for subjective interpretation and does not precisely define the nature of employment interactions between the gig worker and the aggregator. The “terms and conditions of the contract,” which have largely been set by the aggregator businesses, are also unclear.

Approaches to regulate platform workers

There have been developments across countries on both legislative and judicial front to protect the rights of gig workers. If we were to categorize these approaches broadly, they are of two types. Some countries have taken steps to expressly place gig workers within the ambit of employee in a traditional employer-employee relationship. By doing this they have extended the existing provisions for social security and other related benefits to the gig workers which were hitherto available to the traditional employees only. Others have recognized the unorganized nature of gig economy and have not placed it at par with the traditional organized employment sector. They have carved out special rules, regulations and laws for platform based workers by categorizing them separately as ‘dependent contractors’.

Approach I: Gig workers as employees

One of the most contentious tasks of the contemporary times before the courts is to identify the scope of employment or rather to answer the question- who is an ‘employee’?

The answer to this question determines who forms the beneficiary of labour laws. Over the years, certain tests have been developed to delineate the employer-employee relationship and differentiate it from independent contracts. Because the nature of employment is constantly changing and evolving, it becomes difficult to arrive at an objective answer to the question ‘who is an employee’. The courts have come up with numerous tests to determine this but none of them are conclusive. Although, at the end it is a question of fact as to whether a person is an employee or not, several factors can be taken into consideration to determine this. Factors like- degree of control and supervision, chances and risks of profit and loss respectively, payment of wages, economic reality, right to dismiss the employee, etc impact this decision.

One way of protecting gig workers is to establish that gig workers are in fact, employees based on these above listed factors and hence, they should be brought within the ambit of laws that provide social security to employees in the traditional employer-employee setup. While this may not be true for all platforms, but from the general trend witnessed on most platforms, it is clear that platforms do fulfill most of these criteria of traditional employer-employee test, if not all.

This view was expressed clearly by the United Kingdom Supreme Court, when it was faced with the question whether Uber drivers qualify as “workers” under laws like the National Minimum Wage Act. The court went ahead and applied tests like the ones stated above- control test, economic reality test, and integration test, to come to the conclusion that Uber drivers were in fact workers for the purposes of such labour statutes.

The factors that led to the court arriving at such a conclusion were as follows:

The company drafts the service contract that is signed, and employees must concur with it. It’s possible that many employees haven’t even read it, and employee involvement in the contract is non-existent.

Until the customer is seated, the employees are unaware of the destination and are powerless to refuse transportation.

The company sets the compensation and the service charge, which is subtracted from the fare, at its own discretion.

Drivers are penalised or fired based on passenger ratings, which denotes control and subordination.

The corporation receives complaints about drivers and has the option to reimburse a portion of the salary.

There is minimal room for advancement and drivers are viewed as interchangeable within this framework.

The court was of the opinion that not declaring Uber drivers as workers would be against the objective with which labour legislations were created. However, it is to be noted that the court merely determined that Uber drivers are ‘workers’ for the purposes of labour legislation and not whether they constitute as “employees” under the employment statutes as this was never claimed before the court.

Presumption of Employment:

To protect gig workers from exploitation, several countries have come up with laws that provides for presumption of employment in case of platform workers. This is a significant move as traditionally platforms or as the Social Security Code defines them, aggregators often took the view that gig workers were independent workers not within the scope of employment.

Several countries like Spain, Belgium, State of California, and many others have a provision in place which presumes employment of platform-based workers and the exercise of control by the platform. The position taken by EU succinctly explains this presumption.

The European Union (EU) came out with rules for platform workers which were adopted by the EU Parliament in April 2024. The most important part of the rules is the rebuttable legal presumptions that the Member countries are required to establish at the national level. The ‘presumption of employment’ clause is triggered when the platform exercises control over pay and working hours. This is introduced with the aim of correcting the false presumption of self-employment, and the imbalance of authority between the platform and the workers. Such a presumption is rebuttable, and the burden of proof is on the platform to establish that they do not exercise control over the platform workers.

APPROACH II: GIG WORKERS AS A SEPARATE CATEGORY

While the first approach attempts to bring gig workers within the ambit of ‘employees’ based on the tests of employment like control test, integration test, in the second approach, nations try to delineate the scope of gig and platform workers and selectively advance certain benefits to them.

A third category has been carved out, which lies in between employees and independent contractors and is often termed as ‘dependent contractors’ to accommodate gig workers.

The 20th International Conference of Labour Statisticians (ICLS) in October 2018 came out with this categorization and stated that dependent contractors are: “…. workers who have contractual arrangements of a commercial nature (but not a contract of employment) to provide goods or services for or through another economic unit. They are not employees of that economic unit, but are dependent on that unit for organization and execution of the work, income, or for access to the market. They are workers employed for profit, who are dependent on another entity that exercises control over their productive activities and directly benefits from the work performed by them.”

Although the categorization is recent, dependent contractors have been recognized even prior to this. The Canadian Court in 2009 case of McKee v Reid’s Heritage Homes Ltd, laid down the test to identify employees that prima facie fall within the category of self-employed or independent contracts but are in fact, not entirely independent. There is a two-pronged test established to determine who is a dependent contractor; firstly, it has to be determined whether, the relationship is of employment or contractual, and secondly if it is established that the relationship is contractual, it has to be seen if there is a dependent relationship between the platform and worker based on factors like economic dependence, control, exclusivity, etc.

Dependent contractors are eligible to certain benefits unlike the independent contractors. Thus, gig workers which fall within this gray are may be classified as dependent worker and can have certain rights and protection.

ANALYSIS OF THE APPROACHES

While the first approach is a great step in ensuring the rights of gig workers and making them at par with traditional employees, it has its flaw too. Keeping gig workers at par with employees may raise problems for both the platform as well as workers as it may comprise some of the perks of gig economy. If platforms are placed at par with traditional employment some restrictions and responsibilities placed on them may disincentivize them from pursuing such work, which may potentially even hamper employment of workers on such platform.

Further, taking the first approach, while a presumption is placed regarding employment on platforms, but the same is rebuttable. If rebutted, the workers would not have any remedy or rights in place as the benefits advanced under such a presumption depend upon the contingency of the relationship satisfying the control test, economic reality test, etc.

The UK Supreme Court, which went ahead and recognized the rights of Uber drivers as workers in its 2023 decision upheld the status of Deliveroo riders as self-employed. The judgement was based on the fact that Deliveroo riders were not obliged to be available at any time or to accept jobs and could arrange substitute riders for deliveries. While the judgement is legally sound, we believe that even if the gig workers do not satisfy the test of employment, some level of protection must be advanced to them. Placing them at par with ‘employees’ and then rendering them remediless if the test is not satisfied is not a sustainable approach in the long run given the rising trend of gig economy.

In this context, the second approach is slightly better equipped to handle this situation. Instead of simply classifying gig workers as employee, this approach categorizes them separately. While such a position helps in clearly demarcating the rights and remedies available to platform worker, there is a flaw associated with this approach too.

Platform economy constitutes of so many platforms that vary in scale, working arrangement, their activities, organization, scope, etc. With such diversity it becomes complicated to come up with one regulation for all such platforms. Similarly, creating one category for all such work platform cannot effectively solve all problems. At best it can set a minimum standard of protection available to all platform based workers. However, given the fact that the security and rights of more than 8 million people is at stake, such a minimum standard of protection is not enough.

RECOMMENDATIONS AND SUGGESTIONS:

From the above analysis, it becomes clear that the approaches taken by different countries to improve the condition of platform-based workers, while commendable, are not sufficient. Adopting either of the approach will not solve the problem in its entirety, and may lead to further complexities and difficulties in implementation.

In such a scenario, it becomes essential to categorize and sub-categorize platforms based on their consumer base, the kind of service they offer and other such factors.

While a central legislation mandating some minimum protection is absolutely necessary at this hour, it is also essential that power be delegated to states to further come up with laws on platform workers based on the economic trends and behavior of the people of that particular place.

Further, on an international level, while the need to regulate gig economy has been raised a number of times, it becomes essential to have certain guiding principles in place on which countries can base their domestic laws. Again, given the diverse nature of platform economy, having one law will never suffice, thus what is needed is scholarly recommendations, more data on the platform economy, and the engagement pattern of people.

Large Corporations, which have the means, can be required to have a higher standard of security and protection for such workers beyond the minimum standard.

Lastly, such enhanced rights will not improve the conditions of gig workers if proper mechanism to ensure their compliance is not in place and thus, proper authorities to take into consideration the grievances of such workers must be in place, and non-compliance with the standard prescribed must not be taken lightly and should be strictly punished.

CONCLUSION

The rise of the gig economy and platform-based work arrangements has fundamentally transformed traditional notions of employment. As the distinction between employees and independent contractors blurs, it becomes imperative for legal frameworks to evolve accordingly. The Social Security Code of 2020 and recent state legislations, like the Rajasthan Platform Based Gig Workers Act, represent significant steps towards recognizing and protecting the rights of platform workers in India. However, these efforts are not without limitations. The challenge lies in striking a balance between offering adequate protection to gig workers while preserving the flexibility that defines platform work. The global approaches to regulating platform work reveal a need for nuanced and context-specific solutions, recognizing the diverse nature of gig work across various platforms. As the gig economy continues to expand, it is essential for policymakers to remain adaptable, ensuring that legislation not only provides a basic level of protection but also accommodates the unique needs of different sectors within the platform economy. Simply extending the existing laws applicable to employees to gig workers will not suffice. While categorization of gig economy as a separate category itself is commendable, the same also has a lot of flaws. The way forward demands a combination of central and state-level regulations, informed by international best practices and empirical data, to create a sustainable and fair environment for all gig workers.