What Are Your Rights As A Gig Worker With India’s Labour Laws Changing?

By Debarati Chakraborty (With expert inputs from Fatima Ansari)

As a gig worker in India, Riya (name changed) works with multiple clients. Her work often involves travels and hotel stays, and while some companies provide her with tickets or advance payments, there was an instance where a client refused to refund her on time.

Unlike full-time professionals, she had no support from the client’s HR for timely resolution of this problem. Despite her contract mentioning ‘reimbursements for work-related travel’ Riya had to follow up continuously, make several rounds of phone calls and send multiple emails, before her invoice was cleared.

“I was finally paid 5 months after completion of the project. I used a lot of time and energy in following up with the client, and I’m thankful it all worked out in the end,” Riya says.

What could she have done if her client refused to clear her dues? Riya says she relies solely on her contracts and has little knowledge of her rights.

At a time when the gig economy in India is booming, how many gig workers are truly aware of their rights. We spoke to Fatima Ansari, a lawyer and an author of legal books, to better understand the legal rights of gig workers in India.

Labour Laws In India Are Set To Change

The Government of India intends to replace and consolidate 29 separate labour laws with an intent to improve the working conditions and wages of labour and enhance the ease of doing business in the country.

For the first time, gig workers have been defined in the ‘Code’, an important addition to Social Security, 2020. This Code is set to replace 9 legislations that currently provide social security — such as Maternity Benefit Act, Employees’ Provident Fund Act, Employees’ Pension Scheme and Employees’ Compensation Act — to employees. The change is aimed to bring different acts, which so far had different applicability and coverage, under a single guiding ‘Code’.

“The goal of the Code is to extend social security to all employees and workers whether in the organised or unorganised or any other sector,” Ansari says.

As per the Code, ‘social security’ is the protection given to employees, unorganised workers, gig workers and platform workers to ensure access to health care and to provide income security, particularly in cases of old age, unemployment, sickness, invalidity, work injury, maternity or loss of a breadwinner.

Who Benefits From The New Law?

In addition to full-time employees, the Code covers Gig Workers (who participate in a work arrangement and earn from activities outside of a traditional employer-employee relationship) and Platform Workers (who are engaged in or who undertake a work arrangement outside of a traditional employer-employee relationship).

The Code also protects Unorganised Workers (home-based, self-employed or wage workers in the unorganised sector) and covers Fixed-Term Employees (who work under a written contract of employment for a fixed period). Home-Based Workers (who are engaged in the production of goods or services in premises other than the workplace of the employer) are also covered under the Code.

“However, to avail any benefits under the Code, every unorganised worker, gig worker, or platform worker shall be required to register on an online portal (portal name to be declared in the future) with their Aadhar number and other documents,” Ansari explains.

Improved Social Security For Gig Workers

At present, gig workers are not covered under any Indian law. The only legal recourse available to them is under contract laws, placing reliance on the contracts they sign with their clients.

The Central Government aims to address this problem and ensure welfare of gig and platform workers through the establishment of a brand new National Social Security Board. According to the Code, the Centre may frame and notify suitable social security schemes for gig workers and platform workers on matters relating to life and disability cover, accident insurance, health and maternity and creche benefits, old age protection and minimum wages.

These schemes may be funded, in whole or in part, by the Centre or state governments, or by the clients or aggregators gig workers work with, or from corporate social responsibility fund or partly by the gig workers themselves.

With respect to Provident Fund (PF) for gig workers, the contributions paid by the employer to the fund shall be 10% of the wages payable towards each of the employees (whether employed by him directly or by or through a contractor).

Resolution Of Breach Of Contract

It is important to know that like all other employment contracts, a gig contract is also governed by the Indian Contract Act, 1872. As per this Act, when a contract is broken, the party who suffers is entitled to receive compensation for any loss or damage caused to them by the party who has broken the contract.

Talking about what Riya could have done in case of breach of contract, Ansari explains, “She couldn’t have approached a labour court, as gig workers are not yet eligible to do so. If amicable settlement wasn’t a possibility, her only recourse would have been to approach civil courts.”

However, with legal processes being laborious, time-consuming and expensive, gig workers enjoy less leverage than a company would. Also, without the safety net of a fixed income, such contract employees tend to take up new projects instead of spending time on legal battles.

At present, gig workers are not covered under any Indian laws. The only legal recourse available to them is under contract laws, placing reliance on the contracts they sign with their clients.

“Hence, my advice to gig workers is to pay attention to even the minutest of details in contracts. Consult someone more experienced before you sign a contract. Discuss confusing or complicated terms mentioned in the contract with the company before signing it. Your contract is your sole protection,” Ansari says.