Rajasthan outlines plan for gig workers’ welfare

The Rajasthan government has proposed to levy a “welfare cess” on consumers to ensure better rights and facilities for gig workers in the draft of a new law that also provides for a fine up to ₹1 crore on errant aggregators, officials aware of the matter said.

According to the draft of the bill, seen by HT, the government proposes to constitute a welfare board for the platform-based gig workers to register them and their aggregators. The board will be chaired by the state labour minister, and will have representatives from gig workers’ unions, aggregators, and members of civil society.

The cess to be levied on consumers is likely to be 1% of the total value of the service or delivery (such as a taxi ride or a food order), a top government official aware of the matter indicated.

Defining the functions of the board, the draft bill says it will formulate schemes for the benefit of the gig workers, provide them immediate financial assistance in case of accidents and medical emergencies, and offer them health insurance cover under state government schemes, apart from ensuring gratuity, scholarships, and pensions.

“The board will generate a unique ID for a gig worker, which would be valid for three years,” the draft says, adding that the information of all registered gig workers will be maintained in a database.

A government official said this will help workers seek benefits from government welfare schemes such as PM Sambhal scheme (which provides for old age pension), and also to file complaints against aggregators over payment disputes and other issues.

To fund the welfare of gig workers, the state government has proposed the Rajasthan Platform-Based Gig Workers Social Security and Welfare Fund, which will start with seed money of ₹200 crore. For this, the draft says it was levy a “platform-based gig-workers welfare cess, which will be minimum amount on the total value of money paid by a consumer to an aggregator”.

When contacted, state labour secretary Vikas Sitaramji Bhale said: “There is a provision of levying 1% gig worker welfare cess on consumer, which will be collected and used for their welfare by the board.”

According to the draft, the Rajasthan government plans to put in place stringent provisions against violations by aggregators – such as not filing annual reports, and not integrating gig worker data with the board’s database – ranging from ₹10 lakh for the first violation to a maximum of ₹1 crore for subsequent breaches. “The state government can also be recommended to suspend and prohibit operation of the aggregator,” the draft says.

Explaining the rationale behind the proposed bill, Bhale said that it aims to provide welfare and social security to gig workers. “We also intend to change the ongoing equation where aggregators are calling gig workers their partners, which means no employee-employers relation, freeing themselves from any responsibility or providing any benefit. They clearly have an employer-employer relationship,” he said.

He added that the proposed bill was primarily an improved version of the laws providing social security protection to construction workers under the Mathadi Kamgar Act. Bhale said the draft will be sent to law and finance departments for approval, and the government will also seek suggestions from the public.

Gig workers are the those who are engaged in temporary or freelance work, and workers of app-based cab and food-delivery service providers such as Ola, Uber, Swiggy, and Zomato.

The challenges faced by the workers were raised by senior Congress leader Rahul Gandhi during the Rajasthan leg of his Bharat Jodo Yatra last year, leading to chief minister Ashok Gehlot assuring him that a law would be brought for their welfare.

According to a Niti Aayog report in July 2022, around 7.7 million people are employed as gig workers across the country, and this number is likely to treble by 2029-30. A Rajasthan government estimate in August 2022 suggested that there are 225,000 to 270,000 gig workers in the state, with about 50,000 employed with Ola and 35,000 with Uber.

In July, a sample survey of gig workers by the Rajsthan government showed that most gig workers said the work provided them with flexibility, work-life, and the freedom to choose between the type of work they can do. At the same time, however, the survey found that more than 50% of the gig workers did not have any health insurance and about 40% were not covered under the state government’s accidental insurance.

Spokespersons from Ola, Uber and Zomato did not respond to requests seeking comment.

Arun Agarwal, executive director of the Federation of Rajasthan Trade and Industries, said the draft was a a welcome step.

“A large number of the students and people across ages are involved as gig workers and are deprived of social security. The board, once formed, will be able to bring schemes for their welfare,” he said.