Introduction
Gig economy workers—riders, delivery agents, drivers, and freelancers—have become the backbone of India’s post‑pandemic recovery. Yet, their precarious status often leaves them unprotected during illness, accidents, or job loss. In response, both the Centre and state governments are pioneering reforms to extend social security and address institutional gaps.
Federal Framework & Legal Foundations
Code on Social Security, 2020
-
Provides the first-ever legal recognition of gig and platform workers under labour law.
-
Mandates social security schemes for life and disability insurance, health and maternity benefits, old-age protection, and the creation of a Social Security Fund.
-
Repeals and consolidates nine existing labour laws to build an integrated framework Reddit+14Wikipedia+14Bar and Bench - Indian Legal news+14.
Supreme Court Intervention
-
In February 2025, the SC pressed the Union government for a timeline to implement the Code, emphasizing legal responsibility toward workers’ welfare vesting in its provisions Supreme Court Observer.
National Scheme Finalization
-
The Union Budget 2025–26 proposed mandatory registration on e‑Shram, assignment of unique UANs, contribution-based benefits (1–2% of earnings), access to EPF/Pension and inclusion under PM‑JAY health coverage Bar and Bench - Indian Legal news+4Business Today+4Mondaq+4.
State-Level Innovation: Act & Ordinance Updates
Rajasthan (2023)
-
Enacted the Platform-based Gig Workers (Registration & Welfare) Act, setting up a welfare board and fund financed by a platform-based cess.
-
Mandates aggregator registration, simplified grievance mechanisms, and social security provisions Reuters+15Bar and Bench - Indian Legal news+15The Times of India+15.
Karnataka (2025 Ordinance)
-
Introduced the Gig Workers (Social Security and Welfare) Ordinance, praised by Rahul Gandhi as “historic”.
-
Defines fair contracts, algorithmic pay transparency, and protection against arbitrary deactivations.
-
Establishes a cess-based welfare fund (1–5%) shared by platforms, consumers, and workers The Times of India+1The Economic Times+1The Times of India.
-
Draft rules set to be issued within weeks to operationalize the fund and board The Economic Times+1The Times of India+1.
Tamil Nadu (2025 Initiative)
-
Offers ₹20,000 e-scooter subsidies and accidental death/disability insurance for ~150,000 gig workers.
-
Plans dedicated facilities and lounges for gig workers in major cities WIRED+15Reuters+15Business Today+15.
Maharashtra (Draft Legislation)
-
Labour Ministry has announced intent to draft bespoke gig-worker law, including welfare board, stipends, and grievance redressal mechanisms www.ndtv.com.
Core Features of Emerging Social Security Frameworks
-
Universal Registration & UAN: Gig workers will be onboarded via e‑Shram, facilitating identification and benefits entitlement Mondaq+4Business Today+4The Times of India+4.
-
Contribution Model: Central scheme envisions contributions between 1–2%; state cess models range up to 5% per activity, shared by platforms, consumers, and workers Policy Corner JSGP+9PRS Legislative Research+9Business Today+9.
-
Defined Benefits: Pension, provident fund integration, PM-JAY health coverage, disability/life insurance, and maternity benefits structured under the Code Mondaq+2Business Today+2Gig4u+2.
Implementation Challenges & Critical Issues
Legal & Regulatory Clarity
-
Aggregators' liability remains contested—whether they are ‘employers’ under the law and responsible for platform-wide contributions and contract transparency.
-
State legislations may conflict with future central schemes under the Code Bar and Bench - Indian Legal newsThe Times of IndiaBusiness Today.
Benefits Accessibility
-
Complex documentation, low literacy, and non-commercial vehicle use hinder gig workers from claiming insurance or ESIC benefits after accidents or illnesses The Economic Times+15Policy Corner JSGP+15The Times of India+15.
Implementation Friction
-
Lack of collective worker representation and platform resistance to fee structures. Threats of platforms unilaterally reducing pay to offset cost burden are emerging concerns The Times of IndiaBar and Bench - Indian Legal news.
Financial Sustainability & Usage
-
Annual cess collections projected around ₹150 crore in Karnataka; continuous oversight required to ensure that funds support intended welfare schemes The Times of India+11Reddit+11The Times of India+11.
Way Forward: Policy Recommendations
-
Timely Notification of Centre’s Scheme: Union government should quickly notify and operationalize social security measures under the 2020 Code.
-
Harmonised Federal-State Frameworks: Align state welfare acts with central contributions systems to avoid duplication.
-
Strong Oversight Mechanisms: Ensure welfare boards include worker representatives and independent adjudicators.
-
Robust Grievance Redressal Systems: Accessible mechanisms for disputes, payouts, deactivation complaints.
-
Capacity Building & Awareness: Invest in digital literacy and help desks in partner aggregators to assist workers.
-
Standardized Benefits Across States: Uniform minimum entitlements and portability of UAN-linked benefits moving across states/platforms.
Conclusion
India is beginning to weave a social security net for gig workers through progressive legal recognition and pilot welfare schemes. While the Code on Social Security, 2020 lays a national foundation, state initiatives in Karnataka, Rajasthan, Tamil Nadu, and Maharashtra are operationalizing localized welfare boards and funds.
Yet, enduring impact depends on policy clarity, effective enforcement, and collaborative governance. With millions in gig work predicted by 2030, meaningful reform—coordinated across Centre and states—can turn informal labour into a dignified workforce with rights, protections, and equitable safety nets.