Multiple apps, fragmented records complicate gig workers' social security

India's new social security board faces challenges in tracking gig workers across platforms, calculating contributions, and ensuring portable benefits amid overlapping central and state frameworks

Nearly a year after India's new labour laws became operational, the Centre late last month notified the constitution of the National Social Security Board for gig and platform workers, setting up a mechanism to recommend and monitor welfare schemes for a workforce that is expected to expand rapidly.

 

NITI Aayog has estimated that India's gig workforce grew from 6.8 million in 2019-20 to 7.7 million in 2020-21 and has projected that it will reach 23.5 million by 2029-30.

 

However, the absence of a common system to track workers' engagement across platforms, uncertainty over benefit calculations, and overlapping central and state-level frameworks could complicate the rollout of the proposed social security coverage.

 

The board, constituted under the Code on Social Security, 2020, will recommend welfare schemes for different categories of gig and platform workers, advise the Centre on matters relating to the administration of the Code, monitor social security schemes, and review state-level record-keeping mechanisms and expenditure from the Social Security Fund.

 

The Code provides for social security schemes covering life and disability insurance, accident insurance, health and maternity benefits and old-age protection. It also provides for aggregator contributions of 1-2 per cent of annual turnover to the Social Security Fund, subject to a ceiling of 5 per cent of the amount paid or payable to gig and platform workers. The applicable contribution rate and commencement date are yet to be notified.

 

A key challenge will be determining workers' eligibility and calculating their benefits. Under the notified rules, workers must have been engaged with an aggregator for at least 90 days in a financial year, or for 120 days across multiple aggregators.

 

For workers with irregular or seasonal engagement, these thresholds could mean losing access to benefits even when platform work is their primary source of income. Nitesh Kumar Das, organising secretary of the Gig Workers Association (GigWA), said workers who suffered an accident before completing the prescribed engagement threshold could be left without protection.

 

"Basic health and accident insurance should begin from the date of registration, with additional benefits expanding as workers accumulate engagement credits rather than depending on a single eligibility cut-off," Das said.

 

Shaik Salauddin, co-founder and national general secretary of the Indian Federation of App-Based Transport Workers (IFAT), which is represented on the board, said the proposed schemes should cover health, accident and life insurance, pensions, and family welfare.

 

"Social security benefits should be available to all gig and platform workers without exclusions based on below-poverty-line status, income limits or income tax return filings. The benefits recommended for gig workers should also not be lower than those already provided by individual platforms," Salauddin said.

 

The practical difficulty of extending coverage across platforms begins with the way gig work is organised. Unlike regular employment, where provident fund contributions are calculated monthly against an employee's salary, gig work is largely transactional. Workers can move between platforms, take up assignments intermittently, or even combine gig work with formal employment. There is no common ledger through which their engagement across different platforms can be consolidated.

 

"There is no common shared ledger between platforms. So how do you compute eligibility? If you work for 90 days with a platform, it is still easy to compute the benefits, but if you work for 120 days across multiple platforms, how do you calculate that? The infrastructure is needed to be able to provide social security to gig workers. Their benefits will need to be calculated, corrected, deposited, disbursed and accounted for," said Rishi Agrawal, co-founder and chief executive officer of TeamLease RegTech.

 

Agrawal said the nature of engagement also varied considerably. A delivery partner completing one order a day and another completing 100 orders a day could have different levels of earnings and engagement. He also questioned whether contributions should be calculated on each transaction or through periodic aggregate reporting, saying the batch-based compliance model used by institutions such as the Employees' State Insurance Corporation (ESIC) might not suit gig work.

 

A common digital identity and reporting system could help address the problem. Kuljeet Singh, chief financial officer of GI Group Holding, said Aadhaar-linked registration and the Universal Account Number (UAN) could provide a basis for portability, but platforms and staffing companies would need to report workers' engagement and payouts through a common system.

 

"Contributions should follow the worker, not the job. A delivery partner could work on two apps and then take up a three-month warehouse assignment through a staffing firm. Their records would be split across different systems. There needs to be a common reporting standard for engagement days and payouts, with platforms and staffing companies sharing this information electronically, preferably through APIs rather than periodic uploads," Singh said.

 

Singh said the system would also need a common definition of an engagement day, including whether it should be based on logging into an application, completing a task or earning a minimum amount. He said benefits should reflect actual earnings rather than a notional monthly wage, with credits accumulating with every payout. Eligibility, he recommended, should be assessed annually to account for periods of lower work availability.

 

"Accident and life insurance should begin once a worker is registered and active, while health, maternity and old-age benefits can build up with sustained engagement. Workers with higher or more stable incomes should also have the option of making voluntary additional contributions," Singh said.

 

The system would also need to allow workers to access their contribution history and verify the information submitted by platforms.

 

Das called for workers to be able to view and correct their work records on the e-Shram portal. "The e-Shram IDs should become a common identity for workers, with their work history and earnings across multiple apps consolidated in one place. Workers should be able to see their records and correct them if the information reported by aggregators is wrong. Otherwise, they may not even know whether they have met the eligibility criteria for benefits," he said.

 

Agrawal said gig workers currently lacked a common passbook-like facility to track their contributions and entitlements, unlike EPFO subscribers.

 

"Trust as a currency has not been established yet with gig workers' social security. There is no passbook system and this kind of transparency will have to be established," Agrawal said.

 

Das also flagged the possibility that aggregators could indirectly pass on the cost of their social security contributions through lower incentives, bonuses or per-order payments, reducing workers' take-home earnings. He called for independent monitoring to ensure workers did not bear the cost of contributions mandated for aggregators.

 

Another complication is the coexistence of central and state-level welfare frameworks. Rajasthan, Karnataka, and Telangana have introduced their own laws for gig workers, with different approaches to welfare funds and aggregator contributions. Companies operating across these states will need clarity on how their liabilities are calculated and distributed.

 

Agrawal said platforms would have to undertake state-level reconciliation of their revenue to determine where contributions were due. He said the central and state systems would need to operate alongside each other without creating overlapping compliance requirements.

 

The movement of workers between platform-based assignments and formal employment could further complicate responsibility for contributions. A worker may be engaged by a staffing firm, deployed through a contractor, and work at a client's establishment.

 

"In staffing, the difficulty is the number of layers. A worker may be sourced by one firm, deployed through a sub-contractor, and work at a client’s warehouse or on its app. Each party can easily assume someone else is paying," Singh said.

 

Singh said a clear liability matrix was needed to specify the responsibility of different entities, particularly when workers moved between formal employment and gig assignments. He also called for staffing contracts to be revised to account for additional compliance costs and prevent contributions from being missed or counted twice.

 

The constitution of the board provides an institutional mechanism to take these issues forward. However, the effectiveness of the framework will depend on whether a common system can be established to identify workers, reconcile contributions and ensure that benefits remain accessible as they move between platforms, jobs and states.