Govt faces an uphill task in providing social protections to gig workers

While Budget 2025 laid out plans to provide health insurance to gig and platform workers, awareness of government initiatives remains low among the target group

As the sun sets, Inderesh Singh (41) wraps up his shift after completing 20 deliveries. Last month, a road accident left him with severe bruises on his right forearm and leg, forcing him to take two weeks off work.

 

“My savings vanished covering medical bills. If my company had provided health insurance, it would have helped immensely,” he says.

 

Singh, employed through a contractor for a quick-commerce platform, is one of millions in India’s rapidly growing gig workforce, which is projected by NITI Aayog to reach 23.5 million by 2029-30. It is a workforce that functions with practically no social security – a problem Finance Minister Nirmala Sitharaman looked to address in her Budget speech on February 1.

 

Sitharaman announced that gig and platform economy workers would be covered under the Pradhan Mantri Jan Arogya Yojana (PM-JAY), in addition to receiving identity cards and being registered on the E-Shram portal. “Gig workers of online platforms provide great dynamism to the new-age services economy. [These] measures are likely to assist nearly 10 million gig-workers,” she said in her Budget speech.

 

Singh is happy that the government is finally recognising gig work and making policies for them. “It’s always a matter of life and death for people like us who have to make deliveries on motorcycles throughout the day,” he says.

 

However, implementing the decision will require additional measures — including defining gig workers.

 

Who’s a gig worker?

 

Despite its growing presence, gig and platform work has been difficult to define, delaying policy formulation. These jobs are categorised under ‘nonstandard employment,’ where work is contingent, flexible and non-permanent. 

 

The Code on Social Security, 2020, one of four newly enacted labour codes, formally defined gig and platform workers for the first time. Under Section 2(35), a gig worker is someone engaged in work outside a traditional employer-employee relationship. Section 2(60) describes platform work as employment facilitated through an online platform to provide specific services, as notified by the government.

 

However, Akriti Bhatia, founder of People’s Association in Grassroots Action and Movements, an action-research and media advocacy network, argues that these definitions misclassify gig workers.

 

“In India, gig and platform work has become the primary form of employment for millions. The code fails to acknowledge this reality,” she says.

 

A study by the Federation of Indian Chambers of Commerce and Industry (Ficci) and human resource firm Randstad India in 2023 indicated that 42.24 per cent of India’s startups are increasingly hiring gig workers.

 

A name in the database

 

What the initiatives announced in the Union Budget would do is allow gig workers to access medical treatment at over 31,000 empanelled private and public hospitals. 

 

This follows last year’s partnership between the Employees’ State Insurance Corporation (ESIC) and the National Health Authority to integrate ESIC with PM-JAY.

 

Government officials have also indicated plans to launch a pension scheme for gig workers under the Employees’ Provident Fund Organisation (EPFO).

 

Here’s how the scheme would work.  

 

Workers would have to register on the E-Shram portal, and declare the number of platforms they work with. They would then be allotted a single Universal Account Number (UAN) under EPFO, irrespective of the number of platforms they are engaged with. 

 

“The ministry is working on a transaction-based percentage formula to determine the pension,” an official said. “As part of this, for every transaction performed, the platform aggregator will collect a certain amount and deposit it with the EPFO into the worker’s account.”

 

Union Labour Secretary Sumita Dawra told Business Standard that the labour ministry is working on “priority” to implement the Budget announcement, which includes extending healthcare benefits under PM-JAY for gig workers. “For additional social benefits, a lot of work is on with stakeholders to examine the possibilities,” she added.

 

Not quite there yet

 

While the industry has welcomed the initiative, not everybody is convinced that this is the right way to go about it.

 

Shaik Salauddin, national general secretary of the Indian Federation of App-Based Transport Workers (IFAT), emphasises that for the schemes to be effective, aggregator companies must share worker data with the government instead of relying on workers to register themselves. Lack of awareness remains a major barrier to accessing benefits.

 

“Without mandatory data-sharing on the E-Shram portal, many workers will be unable to access these benefits,” he argues. Integration of E-Shram registration with welfare schemes is crucial. Registration alone won’t ensure access to benefits,” he adds.

 

Government data shows that as of February 4, only four platforms are registered on the E-Shram portal. These are Urban Company, Blinkit, Zomato and Uncle Delivery. These platforms have a total of 423,000 active workers engaged with them. 

 

This is despite the labour ministry’s advisory last year asking platform aggregators to register themselves and the workers engaged with them on the E-Shram portal.

 

“While the finance minister spoke about benefitting 10 million gig workers, merely half a million workers have been registered by the platforms despite repeated communication,” says Salauddin. 

 

Some platforms already provide health and life insurance to gig workers. 

 

A study by Ola Mobility Institute last year claimed that many platforms offer accident coverage (including disability and death) to gig workers. While passenger mobility platforms provide up to ₹5 lakh, hyperlocal delivery platforms offer between ₹3 lakh and ₹10 lakh, along with health and medical support, including telemedicine, the study found.

 

Platforms such as Uber, Zomato, and Zepto did not respond to queries from Business Standard on their current policies till the time of going to press.

 

Public health policy expert Rama Baru also underscores the need for clear funding mechanisms and effective targeting.

 

“How will these programmes be funded? Will they rely on budgetary support, or will the private sector contribute? What category of gig workers will the scheme cover?” she asks. “Simply announcing PM-JAY coverage means little unless the scope of coverage is well-defined.” she says.

 

So, while the government’s initiative marks a step towards recognising gig workers, challenges remain in ensuring effective implementation. The road ahead will require sustained efforts to bridge data gaps, improve registration processes, and secure adequate funding. The success of the initiative will determine whether millions of gig workers, like Singh, receive the intended benefits. 

Gig gap

 

• Finance minister announced gig and platform economy workers would be covered under PM-JAY, will receive I-cards, and would be registered on the E-Shram portal – measures that would assist nearly 10 million gig workers
• As on February 4, only four platforms, with 423,000 gig workers in all, had registered on the E-Shram portal 
• India is estimated to have 23.5 million gig workers by 2029-30

 

(NITI Aayog report)