1.

Definition and scope of gig economy

2. Legal framework governing gig economy in India
* Employment laws applicable to gig workers
* Taxation of gig workers and platforms
* Regulatory environment for gig platforms
3. Classification of gig workers under Indian law
4. Employment benefits and protections for gig workers
5. Liability and responsibility in the gig economy
6. Technological advancements and their impact on the gig economy
7. Future trends and challenges in the gig economy
8. Legal implications and potential risks associated with gig work
9. Balancing flexibility and job security in the gig economy
10. Innovative solutions for addressing benefits gap and ethical employment practices
11. International trends and best practices in gig economy regulation
12. Role of stakeholders, including governments, businesses, and workers, in shaping the
future of work in the gig economy.

Sources
[1] Future of Work In India - A Legal Analysis of Gig Economy https://lawcorner.in/legal-
analysis-of-gig-economy-in-india/
[2] What's a 'gig' job? How it's legally defined affects workers' rights and ...
https://www.brandeis.edu/now/2023/january/gig-economy-explained.html
[3] How the Gig Economy Will Impact the Future of Work | Entrepreneur
https://www.entrepreneur.com/starting-a-business/how-the-gig-economy-will-impact-the-
future-of-work/458482
[4] The Rise of Gig Workers: Navigating Legal & HR Implications | NNRoad
https://nnroad.com/blog/the-rise-of-gig-workers/
[5] Legal Challenges and Opportunities for Gig Workers in India - Juris Centre
https://juriscentre.com/2023/10/10/legal-challenges-and-opportunities-for-gig-workers-in-
india/
1. Introduction to Gig Economy
2. History of Gig economy
3. Legal framework governing gig economy in India
4. Types of gig workers
5. Classification of Gig Workers Under Indian Law
6. Reason for growth of the Gig Economy in India?
7. Adv
8. Challenges
9.
 Introduction to Gig Economy
The gig economy, also known as the freelance or on-demand economy, refers to a labour
market characterized by short-term, temporary, or freelance jobs as opposed to traditional
full-time employment. In the gig economy, individuals typically work on a contractual basis,
often through digital platforms or apps, to provide services or complete tasks for clients or
companies.
This phenomenon has been fuelled by technological advancements, particularly the
proliferation of digital platforms and mobile technology, which have made it easier for
individuals to connect with potential clients or employers and offer their skills or services on
a flexible basis.
Gig economy workers, often referred to as "gig workers" or "independent contractors," have
the flexibility to choose when, where, and how much they work, allowing them to balance
work with other commitments or pursue multiple income streams simultaneously. Common
examples of gig work include ridesharing, food delivery, freelance writing, graphic design,
and online tutoring, among others.
While the gig economy offers benefits such as flexibility and autonomy for workers and cost-
effectiveness for businesses, it also raises significant challenges and concerns. These include
issues related to job security, income stability, access to benefits such as healthcare and
retirement savings, and the classification of gig workers as independent contractors rather
than employees, which can affect their legal rights and protections.
As the gig economy continues to grow and evolve, it has sparked debates and discussions
around labour rights, regulatory frameworks, and the future of work in the digital age.
Understanding the dynamics and implications of the gig economy is essential for
policymakers, businesses, and workers alike as they navigate this rapidly changing landscape.
According to the historians, the gig economy is not a new phenomenon but was prevalent
before the 19th century industrial revolution. It was very normal then to be engaged in
numerous occupations to acquire a standard income. A person involving only in a single
career for a lifetime is a recent sensation. But with the advent of the internet and technology
such a concept of one career for a person is undergoing tremendous changes.
History of Gig economy
Gig economy was here from ages but the thing is there was no specific term or concept that
has been introduced until recently to indicate such gigs. Some of the earliest gig works
include, courier services, truck and taxi drivers, nannies and caretakers, personal grocery
shoppers etc.
The beginning of the 20th century has witnessed a great recession that resulted in severe
unemployment that forced people to engage in several works to make a living. The great
depression and famine occurred at that time triggered the lives of farmers that forced them to
sell their farm lands and to move out as migrants, they had to work in several farm lands in a
gig manner to make the ends meet. This is the earliest recorded gig work. Later during the
time of World War II companies who had to finish an abundance of tasks and were lacking
enough workforce, hired workers on a short-term contract basis.
In 1995, Craigslist, an online site to find jobs, was launched in the USA and Elance (now
renamed as Upwork) introduced in 1999 that helped lots of freelancers to find remote works
and connect with the client online. In the later years the real job providing platforms and
crowdsourcing marketplaces like Airbnb, Amazon’s Mechanical Turk (Mturk), Uber, and Lyft
were introduced that marked a new era in the digital marketplace.
By the last decade of the 20th century, the digital era has begun to take off, which has
increased the demand for gig workers in the USA. It has marked the beginning of a new era
of the gig economy. The Internet and technology have significantly taken over the world,
influencing the lives and perspectives of individuals. Access to smartphones and computers
with internet connections predominantly changed the way people think about work, and
consequently broke the conventional idea about employment.

Legal framework governing gig economy in India

The gig economy has transformed the traditional concept of employment in India by creating
opportunities for flexible work arrangements. However, this new way of working has also
raised questions about the legal framework that governs it. Under the Indian labour law
regime, workers may be broadly classified as (i) employees; (ii) contractual workers and (iii)
workers employed in the unorganized labour economy.
Employee: A person employed on wages in an establishment to perform work is an employee.
He is entitled to benefits under laws such as the Minimum Wages Act, 1948, Employees’
Provident Fund and Miscellaneous Provisions Act, 1952 (EPFA), Payment of Bonus Act,
1965, etc.
Contract labour: A person hired through a contractor to perform work for the employer is
treated as contract labour. He is entitled to benefits under the Contract Labour (Regulation
and Abolition) Act, 1970 (CLRA).
Workers in unorganised economy: These workers perform work in the nature of home-based
workers, self-employed workers or wage workers. The welfare of these workers is governed
under the Unorganised Workers’ Social Security Act, 2008 (UWSSA).
Gig workers have limited recognition under the current Indian labour laws. As mentioned
above, the welfare of migrant workers, building and construction workers and unorganized
workers is regulated to an extent under CLRA, UWSSA and Building and Other Construction
Workers (Regulation of Employment and Conditions of Service) Act, 1996. However, these
laws were not designed for the modern gig workers such as platform workers. They are not
entitled to any benefits under any labour laws including contract labour. Even if the definition
of ‘contract labour’ provided scope for extension of CLRA to platform workers, the platforms
do not extend these benefits to such platform workers.
Proposed law for the gig economy
Pursuant to the recommendation of the National Commission on Labour to consolidate
central labour laws, the Ministry of Labour and Employment introduced the Code on Social
Security, 2020 (Code) which recognizes workers such as building workers, contract labour
and unorganized workers. Additionally, the Code introduces and recognizes gig workers and
platform workers. Pursuant to the enactment of this Code, social security would be provided
to all employees and workers, either in the organized, unorganized, or any other sector. The
Code replaces various labour and employment legislations which had varied applicability and
coverage such as the Employees’ Compensation Act, 1923, the Maternity Benefit Act, 1961,
the UWSSA, and the Payment of Gratuity Act, 1972. Currently, the Code is not in effect as
the State Governments of each state in India are in the process of finalizing the rules for the
purposes of the Code. Recently, the Labour Minister of India indicated that the rules have
been prepared by most states and the law will be implemented at an appropriate time.
The Code on Social Security, 2020 defines a ‘gig worker’ under section 2(35) as “a person
who performs work or participates in a work arrangement and earns from such activities
outside of traditional employer-employee relationship”.
Under section 2(45), ‘Platform work’ is defined as “a work arrangement outside of a
traditional employer-employee relationship in which organisations or individuals use an
online platform to access other organisations or individuals to solve specific problems or to
provide specific services or any such other activities which may be notified by the Central
Government, in exchange for payment”.

Social Security for Gig workers under Code on Social Security, 2020

Although the Code recognizes ‘gig workers’ including platform workers, it distinguishes
between employees and gig workers. The Code provides for mandatory provision of gratuity,
employee compensation, insurance, provident fund, and maternity benefit to employees. On
the other hand, it has provided for framing of suitable social security schemes (Schemes) by
the Central and State Governments for gig workers on matters relating to life and disability
cover, accident insurance, health and maternity benefits, old age protection, etc.
The Code further requires the Central Government to establish a social security fund (Fund)
for gig workers. It imposes an obligation on the gig employers such as, ride sharing services,
food and grocery delivery services or other goods and services provider platform to
contribute 1-2% of their annual turnover into the Fund which may be used for carrying out
the Schemes. This contribution by the gig employers will be subject to a limit of 5% of the
amount paid or payable by a gig employer to gig workers. The Code also mandates the
registration of all gig workers and platform workers to avail the benefits of the Schemes.
Additionally, the Industrial Disputes Act, 1947, which governs the settlement of disputes
between employers and employees, has been expanded to cover gig workers.
How are gig workers taxed?
Gig workers fall under the tax rules applicable to self-employed individuals. Any resident
with a taxable income exceeding rupees 2.5 lakhs in a financial year must pay taxes
according to their applicable tax bracket.
Mandatory Tax Filing for Gig Workers:
Yes, gig workers are obligated to file their income tax returns by July 31 of the assessment
year. Their returns must include income from all sources, including freelance work,
consulting, salary, interest, and capital gains.
GST Registration for Gig Workers:
Gig workers should register under the Goods and Services Tax (GST) regime if their total
receipts surpass Rs 20 lakh in a financial year (or Rs 10 lakh in certain Northeastern states).
Once registered for GST, they must adhere to the prescribed schedule for filing GST returns.
The regulatory environment for gig platforms in India is currently evolving. While there are
no specific legislation governing gig platforms, they are subject to a range of laws and
regulations. For example, gig platforms that operate in the transportation sector are subject to
the Motor Vehicles Act, 1988, and the rules and regulations framed thereunder. Additionally,
gig platforms that operate in the e-commerce sector are subject to the Consumer Protection
Act, 2019, which provides for consumer protection against unfair trade practices.
Additionally, the Industrial Disputes Act, 1947, which governs the settlement of disputes
between employers and employees, has been expanded to cover gig workers.
In a recent turn of events, the Government of Rajasthan passed the Rajasthan Platform Based
Gig Workers (Registration and Welfare) Act, 2023 on July 24, 2023. This groundbreaking
legislation is the first of its kind in India and regulates the engagement of gig workers,
particularly those working on online aggregator platforms. The Act applies to both
'aggregators' and 'primary employers' and encompasses gig workers under contract, including
those involved in piece-rate work. It aims to provide social security and other benefits to
platform-based gig workers. This initiative in Rajasthan is inspiring other states, with
Karnataka also considering similar labour reforms, including the possibility of introducing a
cess for transactions related to platform-based gig workers to fund their benefits.
While the legal framework governing the gig economy in India is still evolving, recent
developments in Indian law have recognized the need to provide some level of protection to
gig workers. As the gig economy continues to grow, it is likely that we will see further legal
and regulatory developments in this area.

Types of gig workers

1) Independent contractor
The most common term for a gig worker is an independent contractor. The Internal Revenue
Service (IRS) uses the official time to describe gig workers for tax and income purposes.
Independent contractors are not employees of a company, and they work for a specific period
on a project with the understanding that the project will end and the job will end. Independent
contractors are not eligible for benefits from any company and are subject to self-
employment tax.
2) Self-employed employee
Gig workers can also be called self-employed employees. Self-employed workers don't have
an employer-employee relationship with any company and are responsible for their work and
expenses. The IRS defines a self-employed worker as an independent contractor.
3) Platform worker
Platform workers find work in gig apps and platforms such as Uber, Lyft, or Fiverr. These
workers might have general skills that allow them to work on several platforms or specialized
skills and can only work on one platform.
4) Freelancer
Freelancers work directly with companies that require service. They are given a goal or
project to complete and a contract detailing payment details and the project timeline. They
manage their billing and taxes and have unique skills. Freelancers are also responsible for
their brand and business management. They rely on their network of people and companies to
bring new business.
5) Temporary worker
Temporary workers are a type of grey-area worker. Temporary workers have a set end date
for their employment with a company. One typical example of a temporary worker is a
seasonal worker who works during holidays but is released after the holidays.
6) Side gig
Side gigs are working gigs workers do in addition to their primary income source. Side gigs
can be part of the gig economy for full-time and independent workers. Side gigs are not the
only way a person makes money, and they might have a 9-5 job or other gigs in the gig
economy.
Some examples of gig workers are: Electrician, Graphic designer, freelancer, Tutor, Delivery
agent, etc.

Classification of Gig Workers Under Indian Law

The classification of gig workers under Indian law has significant implications for both gig
workers and platforms. As per law, gig workers who are classified as independent contractors
are not covered by traditional employment laws. The legal definition of “employee” in India
is restricted to persons who are engaged in a “master-servant” relationship. As a result, gig
workers who do not have a direct employment relationship with a platform are generally
considered independent contractors.

However, recent developments have recognized in the need to provide some level of
protection to gig workers. For example, the Code on Social Security, which was passed in
2020, extends social security benefits to gig workers and other unorganized sector workers.
Additionally, the Industrial Disputes Act, which governs the settlement of disputes between
employers and employees, has been expanded to cover gig workers. The classification of gig
workers as independent contractors has implications for both gig workers and platforms. Gig
workers who are classified as independent contractors may not be entitled to the same
protections and benefits as traditional employees, such as minimum wage, overtime pay, and
social security benefits. This can make it challenging for gig workers to make a living wage
and can leave them vulnerable to exploitation.

For platforms, the classification of gig workers as independent contractors can provide
significant cost savings. Independent contractors are not entitled to the same benefits and
protections as traditional employees, such as healthcare, paid time off, and retirement
benefits. This can result in lower labor costs for platforms, making it easier for them to
operate and remain competitive.

The classification of gig workers varies significantly across jurisdictions. In the United
States, for example, gig workers are generally classified as independent contractors, which
means they are not entitled to the same protections and benefits as traditional employees.
However, in some jurisdictions, such as California, there have been efforts to reclassify gig
workers as employees.

In Europe, some jurisdictions have taken a more protective approach to gig workers. In
Spain, for example, gig workers are classified as employees and are entitled to certain
protections and benefits, such as minimum wage and paid time off. Similarly, in the United
Kingdom, recent court decisions have classified gig workers as employees, entitling them to
certain protections and benefits.

The classification of gig workers under Indian law has significant implications for both gig
workers and platforms. While gig workers in India are generally classified as independent
contractors, recent developments in Indian law have recognized the need to provide some
level of protection to gig workers. As the gig economy continues to grow, it is likely that we
will see further developments in the classification of gig workers in India and other
jurisdictions.

Reason for growth of the Gig Economy in India?

Some of the reasons are:

 Rise of Internet and Mobile Technology: Due to the increasing use of smartphones
and the accessibility of high-speed internet, it is now simpler for businesses and
employees to connect online, which has aided in the expansion of the gig
economy.
 Economic Liberalization: The Indian government’s economic liberalization
measures have boosted competition and made the market more open, which has
aided in the gig economy’s expansion.
 Increasing Demand for Flexible Work: For Indian workers seeking flexible work
schedules that enable them to manage their home and professional life, the gig
economy is particularly alluring.
 Demographic factors: A big and growing number of young, educated, and
ambitious Indians are driving forces behind the gig economy as they look to
supplement their incomes.
 E-commerce Growth: The booming e-commerce industry in India has
significantly increased demand for logistics and delivery services, which has
fuelled the expansion of the gig economy in these fields.[2]

Advantages of Gig economy

Advantages of gig economy for Businesses
  Cost savings: No need to provide employee benefits, office space, equipment, and
training[2].
 Access to experts: Ability to contract with experts for specific projects who might be
too expensive to hire as full-time staff[2].
 Flexibility: Ability to respond to market changes by adjusting the workforce
accordingly[1][2].
Advantages of gig economy for workers:
 Independence: Ability to choose projects, working hours, and locations[1][3].
 Variety: Opportunity to explore different areas of interest and improve work-life
balance[1][3].
 Flexibility: Ability to choose when to work and avoid being locked into full-time jobs
that don't interest them[2].
Advantages of gig economy for consumers:
 More choices and convenience in personal services offered[2].
 Higher quality and lower prices for services[2].
 More flexibility and choices in service providers, times, and locations of offerings[2].
Advantages of distributed workforce:
 Access to global talent pool: Ability to hire the best talent, regardless of physical
location[3].
 Cost savings: Reduced overhead costs by operating without a physical office space[3].
 Enhanced productivity: Increased focus and efficiency due to customized work
environments[3].
 Work-life balance: Better management of personal and professional lives, leading to
reduced stress and burnout[3].
 Geographical flexibility: Expansion into new markets and establishment of local
presence without physical offices[3].
 24/7 operations: Faster turnaround times on projects and customer support due to
team members in different time zones[3].
 Business continuity: Resilience in the face of disasters or global crises due to
distributed teams[3].
 Diversity and innovation: Creative problem-solving and innovative ideas due to
diverse perspectives and experiences[3].
 Environmental impact: Reduction in traffic congestion and carbon emissions due to
fewer employees commuting[3].
 Cost-effective scaling: Flexibility in onboarding freelancers or part-time workers
without physical space constraints[3].
 Access to niche skills: Ability to access specialized talents for projects or unique
expertise[3].
 Enhanced employee retention: Increased employee satisfaction and retention due to
flexible work options[3].
Challenges faced by Gig workers
  Lack of benefits such as health insurance, retirement programs, workers'
compensation, and disability insurance for gig employees.
 Stress and burnout due to the variety in professions, leading to energy drain, lifestyle
changes, and potential damage to personal assets like cars.
 Taxes and expenses responsibility falling on gig employees, including self-
employment taxes, quarterly estimated taxes, and the burden of acquiring and
maintaining work-related equipment and supplies.
 Inconsistent income due to the variable nature of pay in the gig economy, where
earnings are dependent on the availability of work and completion of gigs.
 Lack of stability and benefits for workers as gig employees are not considered
traditional employees, missing out on benefits like health insurance, retirement plans,
or workers' compensation.
 Isolation and potential negative impacts on mental health for gig workers due to the
independent nature of the job, leading to feelings of isolation and affecting
productivity and well-being.
 Limited Legal Protections: Gig workers are often classified as independent
contractors, which may result in limited legal protections, such as the right to unionize
or access to worker's compensation.
 Technology Dependence: Gig workers heavily rely on digital platforms and
technology for job opportunities, which can lead to issues like platform dependency,
technological barriers, and algorithmic biases
 Exploitative Practices: Some companies in the gig economy may exploit gig workers
by offering low pay rates, imposing unfavourable working conditions, or engaging in
wage theft.
These challenges paint a comprehensive picture of the difficulties faced by gig workers,
encompassing financial insecurity, job-related stress, tax responsibilities, unstable income
streams, lack of benefits, isolation, and mental health implications. Addressing these issues is
crucial for fostering a more supportive and equitable environment for gig workers in the
evolving landscape of the gig economy.

Impact of covid on the Gig economy

The impact of COVID-19 on the gig economy in India has been profound, reshaping the
landscape of temporary, flexible work arrangements and accelerating its growth amidst
pandemic-induced uncertainty. Prior to the outbreak, the gig economy was already gaining
traction in India, fuelled by the rise of digital platforms connecting independent contractors,
freelancers, and part-time workers to various job opportunities. However, the onset of the
pandemic brought about unprecedented challenges and opportunities for the gig economy,
leaving a lasting impact on both its structure and dynamics.
The pandemic-induced lockdowns and disruptions to traditional supply chains and economies
had a profound impact on India's workforce. With millions facing unemployment and
economic uncertainty, many turned to non-conventional forms of employment, including gig
work, as a means of livelihood. As a result, the gig economy experienced exponential growth,
with estimates projecting a significant increase in gig job opportunities in the coming years.
One of the most significant drivers of the gig economy's growth during the pandemic was the
widespread adoption of digital platforms and technologies. As lockdown measures forced
people to stay indoors, the internet became a lifeline for many, enabling them to access work
opportunities remotely. The emergence of online mediation platforms facilitated the
matchmaking between gig workers and employers, allowing individuals to find work from
the comfort of their homes. Additionally, the shift towards remote work highlighted the
appeal of gig work for individuals seeking flexibility and autonomy in their employment
arrangements.
However, the rapid growth of the gig economy during the pandemic also brought about
challenges and concerns. Increased competition for gig jobs resulted in downward pressure
on wages, leading to a decline in earnings for many gig workers. Moreover, the influx of
former full-time employees into the gig economy heightened competition and exacerbated
precarity in work conditions. As a result, gig workers faced heightened vulnerability and
exploitation by employers seeking to capitalize on the abundant labour supply.
The pandemic also underscored the need for regulatory frameworks to protect the rights and
interests of gig workers. While the gig economy offers flexibility and autonomy, it also
exposes workers to risks such as income volatility, lack of social security benefits, and
limited access to labour rights. Governments and policymakers must address these challenges
by enacting legislation that ensures fair treatment, social protection, and access to benefits for
gig workers.
In response to the growing significance of the gig economy, the Indian government has taken
steps to recognize and regulate gig work. Initiatives such as the imposition of a social security
cess on gig/platform firms and the inclusion of gig workers under minimum wage laws
demonstrate a recognition of the importance of providing social protection to gig workers.
However, more comprehensive regulatory frameworks are needed to address the evolving
nature of gig work and safeguard the rights of workers in the gig economy.
In conclusion, the COVID-19 pandemic has had a profound impact on the gig economy in
India, accelerating its growth and reshaping its dynamics. While the pandemic presented
opportunities for individuals seeking flexible work arrangements, it also highlighted the need
for regulations to protect the rights and interests of gig workers.

Technological advancements and their impact on the gig economy

Technological advancements have played a significant role in the growth and development of
the gig economy in India. Technological advancements have enabled gig platforms to
streamline their operations and connect gig workers with customers more efficiently. For
example, the use of artificial intelligence and machine learning algorithms can help gig
platforms match workers with jobs that best fit their skills and experience. Similarly, the use
of mobile apps and other digital technologies can help gig workers communicate with
customers and manage their work more effectively.

However, technological advancements also pose several legal challenges and opportunities
for the gig economy in India. One of the primary challenges is data privacy and security. As
gig platforms collect more data about gig workers and customers, they must ensure that the
data is protected from unauthorized access and misuse. The Personal Data Protection Bill,
2019, which is currently under consideration by the Indian Parliament, seeks to address some
of these concerns by regulating the collection, storage, and processing of personal data by
businesses, including gig platforms.

Another challenge is the potential impact of technological advancements on employment law.

As gig platforms continue to automate their operations, there is a risk that gig workers may
be classified as employees rather than independent contractors, which would significantly
impact their employment rights and benefits. The Industrial Relations Code, 2020, which
consolidates and amends several labour laws, includes provisions for determining the
employment status of workers, which may help clarify the classification of gig workers.

At the same time, technological advancements also present several opportunities for the gig
economy in India. For example, the use of blockchain technology can help improve
transparency and accountability in gig work, while the use of augmented reality and virtual
reality can enhance the customer experience.

Technological advancements have had a significant impact on the gig economy in India,
enabling gig platforms to streamline their operations and connect gig workers with customers
more efficiently. However, technological advancements also pose several legal challenges
and opportunities, including data privacy and security concerns and potential impacts on
employment law. Looking towards the future, it is likely that technological advancements
will continue to play a significant role in the gig economy in India. In particular, the use of
artificial intelligence and machine learning algorithms is expected to become more prevalent,
which may lead to greater efficiency and innovation in the gig economy.

Gig Economy and Women Empowerment

The COVID-19 pandemic has been especially hard on working women, with thousands
losing jobs and India seeing declining rates of female labour force participation (FLFP).
However, the pandemic has also provided us with an opportunity to take women along the
path of recovery & growth to create a more inclusive, equitable economy. The rapidly
expanding Gig/platform economy of India can turn out to be a viable alternative for millions
of women who lost jobs during the pandemic or are looking for opportunities to join the
workforce. Flexible work arrangements provide a huge advantage when compared to working
on fixed timings of 9-5 for many women already burdened with housework. For them, the
Gig economy can help mitigate some of the barriers they face by enabling Flexi-work and
allowing women to access new forms of employment opportunities through online labour
platforms.
Through initiatives announced in the Budget 2021 such as the decision to allow women to
work in all categories as well as in night shifts, backed by suitable safeguards will give
another boost to the Gig economy in the country. Further, efforts to help formalize the Gig
economy will make it more attractive for women to enter the Gig workforce.
While there remains a significant gender gap in today’s workforce, women’s participation in
the freelance industry has been slowly gaining momentum over the last few years. Currently,
women’s overall workforce share in most countries is still lagging, but women are making
strides in several fields. According to Freelancer Income Report 2020, most women
freelancers in India have clients based in the United States with average work times of 2-2.5
hours.

Gig work and rise of gig economy - The India story

The World Bank Group's 2019 report on the Changing Nature of Work estimated that
less than 0.5% of the global active labour force participates in the gig economy, with even
fewer, less than 0.3%, in developing countries. However, India tells a different story, with a
burgeoning gig and platform economy that has witnessed significant growth. As per the 2022
report by India’s public policy think tank, NITI Aayog, on ‘India’s Booming Gig and
Platform Economy’ (NITI Report), the share of gig workers in total workers increased from
0.54% in 2011-12 to 1.33% in 2019-20. The advancement of technology has also enabled the
emergence of temporary workers using online platforms thereby amplifying the focus on gig
work. As per a report published by NASSCOM, the Indian gig workforce is expected to
expand to 23.5 Mn workers by FY30 from 7.7 Mn in FY21, gig workers will form 4.1% of
the total workforce in India by FY30, from 1.5% in FY21 and approximately 22% of the jobs
are high-skilled, 47% are medium-skilled, and 31% are low-skilled.

Global Development in Labor Laws

The gig economy, while offering flexibility, presents significant challenges in upholding labor
rights. Gig workers lack standard employee benefits like health insurance and paid time off,
making them financially vulnerable during illness or downturns. Excluded from traditional
labour protections, they face job insecurity due to fluctuations in demand. The absence of
social security further compounds their vulnerability, leaving them without a safety net in
times of need. The commoditization of work and competition among gig workers can drive
down wages.
Addressing these issues requires a re-evaluation of labour laws to strike a balance between
flexibility and worker protections, acknowledging the complex nature of this evolving
employment model.
Cases involving gig workers have been reported in several countries including but not limited
to USA, UK, Australia, Spain, Italy, France, China & India among others.
United states of America (USA): Companies like Uber and Deliveroo, ballooning into global
corporations, have faced legal battles over the misclassification of vast majority workers as
independent contractors or self-employed. The major potential problem is that gig workers
are not in tune with the legal definition of employees. The Supreme Court of California in its
landmark judgement (Dynamex Operations West, Inc. v. Superior Court) of 2018, introduced
the control test, attempted to redefine the employee-employer relationship and which needed
companies (such as Uber and Lyft) to consider and treat their workers as employees and not
merely as ‘independent contractors’).
Australia: Australian gig workers also to get right to negotiate minimum pay, conditions. If
passed, the "Closing Loopholes Bill" will come into force on July 1, 2024. The law will
define 'employee-like workers' in the gig economy, including those who deliver food or drive
for apps like Uber or DoorDash. Australian gig workers will be able to negotiate for
minimum pay and conditions under a new law to be introduced next week in parliament by
the centre-left Labor government.
United Kingdom (UK):In a unanimous decision, the Supreme Court of United Kingdom has
endorsed the Employment Tribunal findings that the claimant drivers should be classified as
‘workers’ rather than self-employed in highly publicised case of Uber v Aslam has now
received its final appeal ruling. The judgment was decided upon the specific facts of the case,
and therefore applies only to the drivers who brought the claim against Uber. It does not
necessarily mean that other Uber drivers would also be classed as ‘workers’. Nevertheless,
the judgment sets an important precedent and is likely to encourage further claims against
Uber. Uber have since confirmed that they will pay all their UK drivers a guaranteed
minimum wage, holiday pay and pension contributions.
Netherlands: Deliveroo's employment practices in the Netherlands, particularly the use of
freelance contracts with riders, faced controversy and legal challenges from labor unions. The
dispute between FNV and Deliveroo resulted in court proceedings, where the subdistrict
court and court of appeal ruled that Deliveroo's contracts should be considered employment
contracts, in line with Dutch labor laws. The Supreme Court has confirmed this judgment,
marking a change from the previous practice of engaging riders as independent contractors.
Spain: On May 11, 2021, Spain approved a landmark law aimed at protecting gig economy
delivery workers. The law gives delivery platforms until mid-August to hire workers who are
currently freelancing for them. It also mandates transparency in the use of artificial
intelligence for managing workforces. The royal decree, passed by the canter-left ruling
coalition, immediately impacts around 30,000 couriers. The decision follows a ruling by
Spain's top court the previous year and reflects a broader trend in Europe and other regions
grappling with the labor model of the gig economy, known for precarious jobs and low
salaries. Prior to this law, gig workers had to cover their own social security fees to access
benefits like unemployment subsidies and public pensions.
France: In France a recent law dated February 7, 2022, authorised the Government to enact
regulations regarding platform workers. These regulations could cover the right to workers
representation and sector-wide agreements (in particular concerning remuneration,
professional training, working conditions and risks prevention).
European Union: The Council and the European Parliament have tentatively agreed on a
directive aimed at improving working conditions for platform workers. If confirmed, the
agreement will grant millions of platform workers access to employment rights. The directive
focuses on determining the correct employment status for digital platform workers and
introduces the first EU rules on the use of algorithm systems in the workplace. These
measures aim to provide clarity on employment classifications and regulate the ethical use of
technology, potentially leading to a fairer and more inclusive labor market.
China: Even China, known for the extreme exploitation of its labourers, strode ahead to
protect its gig workers by striking a balance between labour rights and the simultaneous
development of digital apps. China's Supreme People's Court aims to find a balance between
protecting gig workers and supporting the development of internet platforms like Meituan
and Didi Chuxing. Executive Vice-President He Rong stated that the court has clarified labor
rules for the "new form of employment," including delivery workers and ride-hailing drivers.
The court aims to regulate platforms for healthy growth while safeguarding workers' rights,
indicating a willingness to consider tech platforms' interests in the formulation of new labor
rules. This suggests a flexible approach, potentially sparing companies from treating all
workers on their apps as full employees.

As we’ve seen, while some existing and planned legislative measures in India are pertinent to
gig workers, they are insufficient or inconsistent in addressing their unique problems and
requirements. Additionally, we’ve discovered that there are a number of gaps and restrictions
in how these legal rules are understood and applied, as well as disagreements and
inconsistencies between various sources and countries. Additionally, as we have shown, there
are a number of opportunities and problems for law and policy makers in India to control and
regulate the gig economy, which is a complicated and dynamic phenomenon involving
numerous and diverse parties.

Therefore, we conclude that there is a need for a comprehensive and coherent legal
framework that can protect and empower gig workers in India, and ensure their dignity,
welfare, and empowerment. Such a legal framework should be based on the following
principles:

 Recognition: Gig workers should not be classed as either employees or independent

contractors, but rather as a separate category of workers under the law, with their own
rights and obligations.
 Representation: Gig workers should have the opportunity to establish or join unions or
associations that can speak on their behalf, advocate their interests, and engage in
collective bargaining or other dispute resolution procedures with platforms or clients.
 Regulation: Platforms should be subject to legal regulation to ensure their
accountability and transparency and to stop unfair or abusive practices like
harassment of gig workers or customers or discrimination.
 Redistribution: Gig workers should have access to social security benefits, including a
guaranteed minimum wage, health insurance, accident insurance, maternity benefits,
and pensions. These benefits should be paid for by payments from the federal
government, state governments, and platforms.
 Resilience: The legislation should assist gig workers in developing their skills and
competencies and in finding alternative work arrangements, including cooperatives or
social enterprises, as well as in accessing additional employment prospects.