This article has been authored by Nandini Gupta, a fourth year student at UILS, Panjab University.
The Oxford English dictionary defines a gig economy as an economic system in which short periods of work are available to individuals rather than a permanent job. In other words, a Gig Economy encompasses the use of workers on a temporary or freelance basis to perform jobs. A gig worker takes up a job on an hourly basis or part-time basis. It is mostly temporary in nature and the worker is then paid after the completion of the job. i.e., piece rate. Urban Company, Uber, Ola, Swiggy, Zomato, and many similar digital services that connect customers with service providers constitute India’s booming gig economy. India has the highest number of gig workers, with 24% of global online labour, as per the Oxford Internet Institute’s Online Labour Index.
A gig economy enables the independence of choice to explore new fields and helps in creating a new pool of talent. Due to the absence of a proper employer-employee agreement in place, gig workers are often subjected to arbitrary terms with an absence of social security benefits and basic rights. The Fairwork Project in 2020 released a report wherein they evaluated the working conditions of gig workers, more specifically the “Platform Workers” in the digital space. The major findings of their report included –
● Gig or Platform Workers when demarcated from organised workers have limited access to protections of minimum wage, working hours, social security benefits, and collective bargaining. India for the first time recognised “Gig” and “Platform” workers in 2019 when a draft of Code on Social Security was introduced, which the author shall discuss later.
● The Project considered a total of eleven platforms for their report from sectors of e-commerce, food delivery, ride-hailing, and home services. These platforms were judged on five main parameters of Fair Pay, Fair Conditions, Fair Contracts, Fair Management, and Fair Representation.
● The Report stated that there was insufficient evidence of the fact that the workers were paid a minimum wage by the platforms. There was also an absence of social security benefits, and the procedure through which a worker could claim them was unclear.
● A proper set of Terms and Conditions between the platforms and workers was also missing, which resulted in the wrongful fixation of wages and working conditions of the workers.
● However, the Report laid down that most of the platforms were successful in establishing a due and proper channel of communication wherein the workers could appeal to the platform regarding their grievances.
In an economy of approximately 3 million gig workers which includes, workers from online platforms, independent contractors, on-call workers, and independent workers, there arose a need for regulation especially when estimates state that 56% of the new employment which is generated is from the gig world.
This is where the Code on Social Security (“The Code”) comes in, which aims to regularise the workforce from all spheres including gig and platform workers. The Code which received the President’s assent on 28 September, 2020 replaces nine acts and aims to bring in uniformity in providing social security benefits to employees.
Section 2(35) of the Code defines Gig Worker as “a person who performs work or participates in a work arrangement and earns from such activities outside of traditional employer-employee relationship.”
Section 2(60) of the Code defines Platform Work as a work arrangement outside of a traditional employer-employee relationship in which organisations or individuals use an online platform to access other organisations or individuals to solve specific problems or to provide specific services or any such other activities which may be notified by the Central Government, in exchange for payment” and Section2(61) defines a Platform worker as “a person engaged in or undertaking platform work.”
Further, the Code under Section 113 provides for compulsory registration of gig and platform workers to avail the benefits of the schemes framed under this Code, provided firstly, he has completed sixteen years of age or an age which the Central Government may prescribe and secondly, he has to submit a self-declaration containing information which the Central Government may prescribe.
Earlier, there was no legal sanction that provided any social security benefit to gig and platform workers but Code of Social Security bridges this gap. Section 114 of the Code states that the Central Government may frame social security schemes for the gig workers and platform workers pertaining to the matters of life and disability cover, accident insurance, health and maternity benefits, old age protection, crèche, or any other benefit that may be determined by the government itself.
The Code, like any other legislation, suffers from certain inadequacies. It fails to account these workers as organised workers, and therefore they will not be given the benefits of the schemes which other regular employees would enjoy. They will only enjoy the benefits of the schemes that the government would frame. Also, there is no mention of a minimum wage, sick leaves, or paid holidays that would be guaranteed.
Recent Development in International Jurisprudence: Uber BV and Others vs Aslam and Others
The decision of the United Kingdom Supreme Court on the employment status of the company Uber’s drivers could have implications for the gig economy worldwide.
The case began in 2016 when two drivers of the Uber Company, Yaseen Aslam and James Farar filed a case before the Employment Tribunal contending that drivers should be treated as Employees and not gig workers. The tribunal made a decision in the favour of the drivers, which in October, 2016 was appealed by Uber. The Appeals Tribunal upheld the ruling of the Employment Tribunal. Thereafter, Uber decided to approach the Court of Appeal where the decision was again upheld. As a last resort, the company moved to the Supreme Court which led to the passing of this landmark judgment on 19 February, 2021 wherein the Court confirmed that Uber drivers are to be classified as “workers” under the UK Employment Law and would be entitled to various work benefits which include minimum wages, paid holidays, etc. The court laid emphasis on the following findings of the Employment Tribunal to support their decision -
● The remuneration that is fixed to the drivers for the trips is fixed by the company Uber and the drivers have no say in it. The drivers cannot charge more than the stipulated fee from the customers.
● Uber gives out a standard form of contract which is to be signed by the drivers. Drivers have no freedom to negotiate the terms of the contract.
● A driver’s choice whether to accept or deny requests from a passenger is limited by Uber in two ways: firstly, the driver is also told the average rating of the passenger, and the driver is allowed to avoid the passengers with a low rating and secondly, the destination of the passenger is only disclosed to the driver after the passenger is picked.
● Uber also exercises control over the services that are being provided by the driver. For instance, when a ride is accepted, the app shows a route from the pick-up location to the destination. It is not compulsory for the drivers to follow the route, but the passengers have the freedom to complain against the driver if a different route is picked which causes financial risk to the driver.
● All the conversations between the driver and passenger are controlled by Uber, starting from the acceptance of the ride, fixing a driver, collection of fares, payment to the drivers, and the redressal system.
● The performance of a driver is also monitored by the company, and Uber has the liberty to terminate the driver in case he doesn’t provide services up to their satisfaction.
Lord Leggatt observed that the relationship between the drivers and Uber is based on “subordination and dependency” and therefore, falls within the ambit of a “worker” and not “self-employed individuals”.
In India, where the gig economy is constantly growing, the issue of establishing an employer-employee relation between the drivers and aggregators i.e., Uber and Ola has arisen multiple times where the drivers have gone on strikes fighting against the exploitation accrued to them, and the companies have kept the workers in a grey area by refusing to accept them as employees and addressing them as “driver-partners”. They claim that the companies only provide technology to self-employed drivers. The judgment of the UK Supreme Court clearly defines that drivers in the company are to be treated as “employees” and should be given social security benefits and other benefits which include minimum wages, paid leaves. Uber as a company has established its operation worldwide and this judgment is likely to define the relationship between the drivers and the company worldwide. This judgment when read in consonance with the prevailing laws in India i.e., the Code on Social Security fills the lacunae of the latter and helps in bringing platform workers of cab services on the same lines as that of an organised worker.
The Code on Social Security is definitely a beneficial step towards the universalization of workers engaged in gig and platform work. The government can extract a lot of benefit from this booming economy which has seen significant growth in the pandemic, despite being hit in the worst manner possible. The aggregators cannot hide behind arbitrary terms anymore and have to take accountability for their workers. With a clear legal sanction in place, the workers will be in a better position to assert their rights.