By — Srisoniya Subramoniam

Abstract

The gig and platform economy has had a rapid expansion recently, which has fundamentally altered traditional employment relationships. The older labour laws were incompetent in addressing such flaws, but the new codes, especially the Social Security Code of 2020 has been capable of addressing certain issues and providing recognition to the workers to a great extent. This article aims to delve deeper into the said Code to understand whether the provisions are truly a boon for the gig economy or merely an illusion to keep them at bay. By exploring the statutory provisions, funding mechanisms, and other structures, and drawing insights from contemporary discussions and academic literature, the article argues for the adoption of a proper set of laws that will delegate rights to the workers without any barriers. It concludes by emphasising that unless structural and legal reforms are undertaken, social security for gig workers will remain aspirational rather than substantive.

Introduction

Recently in India, there has been an influx of service-providing digital platforms such as Zomato, Blinkit, Urban Company, etc., which have brought about a truly profound digital transformation in society. It has changed how traditional workplace relations function. The conventional employer-employee relationships prevalent in most workplaces no longer exist. They have been replaced by newer relationships that place less accountability on employers, reduce labour protections, and effectively put employees at a disadvantage. This relationship shifts economic risks onto workers, leaving them vulnerable and without access to minimum wages and social security.

Tasks such as housekeeping, laundry, parlour, food-ordering, grocery-shopping and many other activities which previously required the physical presence of the people requesting such services have now been rendered unnecessary. The touch of a button can now deliver these services. But at what cost? Often, the backdoor process of such services is neglected by the beneficiaries, for instance, the delivery personnel. Originally, Indian labour laws did not adequately protect workers engaged in informal occupations or non-standard work, being predominantly based on standard employment relationships. But the newer Code on Social Security, 2020 (hereinafter referred to as the ‘CSS’) represents a legislative attempt to address this gap by extending social security considerations to gig and platform workers. Drawing from contemporary policy discussions and academic analysis on gig work, this article interrogates whether the Code meaningfully protects gig workers or merely acknowledges their existence without securing enforceable entitlements.

The Legal Architecture of Social Security for Gig Workers

It is common knowledge that the traditional classification or absence of acknowledgement of gig workers as employees in the proper sense raised several issues of protection. The CSS has been reformative in its efforts to rectify the mistake by providing formal recognition to gig and platform workers as separate categories of labour. This acknowledgement by the legislature is a symbol of changing dynamics and an acknowledgement of the work carried out by the said workers. It reflects an understanding and an effort to provide adequate safeguards and social security. 

The CSS framework lays down certain minimum engagement procedures and compliance thresholds. Under the draft rules, the social security shall only be applicable if the worker is engaged for a minimum period of 90 days with a single aggregator or 120 days if engaged with multiple aggregators in a said financial year. But an interesting benefit that is provided to the workers is that if a worker works with more than one aggregator on the same day, each engagement will be counted separately. This provision would help the workers to reach eligibility faster, allowing them to secure the long-overdue Social Security. 

For this purpose, the Ministry of Labour and Employment launched an e-Shram portal for the creation of a consolidated database of unorganised workers, by providing the workers a Universal Account Number (UAN) on a self-declaration basis. The enumerated benefits, such as ID, health benefits, etc., are deemed to be provided under the Ayushman Bharat-Pradhan Mantri Jan Arogya Yojana (AB-PMJAY) for the welfare of the gig and platform workers.

Still, the manner of such recognition invokes certain criticisms. 

The Code adopts a scheme-based approach to social security for gig workers, enabling the Central and State Governments to notify welfare schemes covering benefits such as health insurance, disability cover, maternity benefits, and old-age protection. While this appears progressive, the benefits are not framed as statutory rights which one can fight for. They are merely contingent upon discretion and lie very low on the fiscal priority list. Such benefits cannot be reaped by the workers as and when they require, but instead when the administration is capable of providing. And such discretionary rights cannot be classified as benefits in the first place; they are consolatory at best and result in fragmented and uneven protection. The absence of clear eligibility criteria, timelines, and enforceability mechanisms under the CSS means that gig workers cannot legally claim social security benefits as a matter of right. This stands in contrast to formal sector workers, whose social security entitlements are statutorily guaranteed. Furthermore, the deliberate avoidance of classifying platforms as ‘employers’ allows aggregators to exercise significant control over workers – through algorithms, ratings, and termination policies – without corresponding legal responsibility. As noted in recent policy discussions, this creates a regulatory imbalance where platforms benefit from labour flexibility while workers remain structurally vulnerable.

Illusion of Welfare Protection

The Code’s framework appears to be inclusive, but the true effectiveness of any social security regime depends not only on recognition but also on sustainable funding and robust enforcement. The CSS proposes a contributory mechanism requiring aggregators to contribute a small percentage of their annual turnover towards social security schemes for gig workers. However, this contribution is capped at 5 per cent of the workers’ pay and does not correlate with the number of workers engaged or the intensity of control exercised by the platform. Academic discussions on social security financing for gig workers caution that turnover-based contributions, without minimum benefit guarantees, risk underfunding welfare schemes. 

In India, gig workers earn a very minimal income compared to their needs and the economy. Apart from earning very little, they are further ill-treated during their employment and have no safeguards or job guarantees. This lack of bargaining power further adds to the funding model, rendering it insufficient to provide adequate protection. Equally problematic are the enforcement directives. The Code does not establish direct enforcement guidelines; there is a lack of a grievance redressal mechanism or an adjudicatory forum for the workers. This puts them at a disadvantage compared to formal workers, who, in the case of labour disputes, can approach designated labour courts or industrial tribunals. This only furthers the criticism that the Code prioritises policy flexibility and the illusion of welfare over actual worker protection.

Speaking from even a constitutional perspective, this Code seems to be contradictory to Articles 14 and 21, which guarantee equality and freedom of life and liberty and livelihood. While judicial precedents have been consistent in highlighting the importance of social security for a wholesome life, there has not been sufficient enforcement to uphold the same, which perpetuates inequality between the two classes of workers.

Conclusion

The Code on Social Security, 2020, is indicative of a crucial transformation in Indian labour law history with the long-overdue recognition of gig and platform workers within the legal framework. However, such a recognition cannot be used as a substitute for actual substantive protection. The discretionary provision which has been made available under the law prevents an accessible social security right from being created for the workers. This article argues that the current framework prioritises social security over other policy or financial commitments. It asks for meaningful security to be provided through rights-based entitlements, clearer aggregator accountability, and accessible enforcement and redressal mechanisms. The reform trajectory must therefore move towards binding aggregator obligations, minimum statutory protections and robust enforcement mechanisms which conduct regular checks to ensure practical benefits. Without such additions, the new social security labour law codes will merely be illusory rather than promising. 

About the Author

Srisoniya Subramoniam is a third-year B.A. L.L.B. (Hons.) student at Jindal Global Law School (JGLS) with a keen academic interest in legal scholarship, especially Intellectual Property Rights, Artificial Intelligence, International Law, and Criminal Litigation. 

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