Zomato, Swiggy to give up to 2% yearly turnover for welfare of gig workers

Food delivery and quick commerce platforms like Zomato, Swiggy and Zepto must now contribute up to 2 per cent of their turnover for gig and platform worker welfare

Online aggregators, which include companies like Zomato, Swiggy and Zepto, will now be required to contribute up to 2 per cent of their annual turnover, capped at 5 per cent of payments, towards the welfare of gig and platform workers.

 

The development comes as the country announced four Labour Codes on Friday, including the Code on Social Security (2020).

 

Under the code, for the first time, the definitions of "aggregator," "gig worker," and "platform worker" have been mentioned. According to the Ministry of Labour and Employment, the code will provide security to all workers such as provident fund (PF), employees' state insurance corporation (ESIC), insurance, and other social security benefits.

 

The ministry added that the gig and platform workers will get an Aadhaar-linked Universal Account Number (UAN), which will make welfare benefits easily accessible, portable, and available across states, regardless of migration.

 

The code extends social security to all workers, including unorganised, gig, and platform workers, covering life, health, maternity, and provident fund benefits. It also introduced digital systems and facilitator-based compliance for greater efficiency, the ministry said in a press release.

 

It added that a dedicated Social Security Fund will be set up to finance schemes, and the amount collected through the compounding of offences will be credited to this fund for use by the government.

 

Commenting on the development, an Uber spokesperson said, “Uber welcomes the government's move to implement the new labour codes, including the Code on Social Security. Uber looks forward to working closely with the government to ensure the speedy and effective implementation of these reforms.”

 

 “There was an emerging need to address issues related to professional/ freelance (gig) services, technology enablement, and new ways of working. These had necessitated implementation of contemporary work arrangements to address the current needs of corporates, public sector employers, individual workforce, consultants, and freelance/ gig workers,” Minu Dwivedi, partner at JSA Advocates & Solicitors, said.