Startup Originals Team
The Karnataka Assembly has made history by passing the Karnataka Platform-Based Gig Workers (Social Security and Welfare) Bill, 2025-the first law of its kind in southern India dedicated to protecting app-based gig workers. With over 400,000 gig workers in the state, the new legislation signals a major step toward recognizing and securing the rights of those powering the digital economy.
What the Bill Mandates:
Creation of a Welfare Fund:
The bill establishes a dedicated Gig Workers Welfare Fund, designed to provide social security and benefits for gig workers. This fund will be financed through:
- A welfare fee of 1–5% on each payout to workers, collected by aggregators for every transaction.
- Voluntary contributions from gig workers.
- Grants from both state and central governments.
Governance and Oversight:
A state-appointed Welfare Board will manage the fund and oversee the welfare of gig workers. The board will include:
- Government officials
- Four representatives each from workers and aggregator platforms
- Members of civil society
The Board will also handle worker registration and guide grievance handling.
Promoting Transparency and Accountability:
Aggregators are now required to:
- Inform workers about earnings, fares, customer feedback, and algorithmic monitoring.
- Set up an internal dispute resolution committee, followed by escalation routes to the Welfare Board and ultimately an appellate authority.
These measures aim to make work conditions fairer, more transparent, and responsive to worker concerns.
Gig Workforce Context and Impact:
India’s gig workforce is projected by NITI Aayog to reach 2.35 crore by 2029–30. Karnataka alone has more than four lakh gig workers, many of whom work up to 16 hours a day with few protections.
The new law brings app-based workers into social security schemes, reflecting changing work patterns in the digital age. Labour Minister Santosh Lad emphasized the need to address long hours and on-call expectations, citing the often precarious nature of gig employment.
Design Gaps and Challenges:
While the bill is a significant advancement, it presents some design challenges:
- Aggregators like Uber and Ola, who route payments via their platforms, are required to contribute.
- Matching-only platforms such as Namma Yatri, where payments go directly to drivers, might not be subject to the levy, potentially leaving gaps in coverage.
Conclusion:
Karnataka’s Gig Workers Welfare Bill sets a precedent in India’s labour laws, offering social security and protection to platform-based gig workers through a dedicated welfare fund. As the workforce and economy evolve, the bill highlights both progress and the need for ongoing refinement to ensure inclusive coverage and fair benefits for all gig workers.
