Fairwork India Report Exposes Unfair Working Conditions For Gig Workers

A recent report by Fairwork India, a research initiative led by the Centre for IT and Public Policy, International Institute of Information Technology Bangalore and Oxford University has shed light on the dismal working conditions of gig workers on digital platforms in India.

The Fairwork India Ratings 2024 report evaluated 11 platforms, including Amazon Flex, BigBasket, BluSmart, Flipkart, Ola, Porter, Swiggy, Uber, Urban Company, Zepto, and Zomato, against five principles like fair pay, conditions, contracts, management and representation.

However, the findings raised concerns as no platform scored more than six out of ten points, and none met all the first-point criteria across the five principles. The report highlighted the platforms' failure to provide fair pay, safe working conditions, and adequate representation to workers.

Notably, only BigBasket and Urban Company were awarded the first point under fair pay for instituting a minimum wage policy that guaranteed all their workers earn at least the hourly local minimum wage after factoring in work-related costs. No platform earned the second point under fair pay, which requires platforms to commit to and ensure a local living wage after work-related costs or provide sufficient evidence that all workers earn at least this amount, it added.

“This year witnessed gig workers’ welfare increasingly gain attention in political manifestos and legislative initiatives. But with the implementation of these efforts remaining uncertain, and platforms redefining gig work, research and advocacy to improve the conditions of gig workers are ever more relevant,” said Professors Balaji Parthasarathy and Janaki Srinivasan, the Principal Investigators of the team.

The report also mentioned that Amazon Flex, BigBasket, BluSmart, Swiggy, Urban Company, Zepto and Zomato were awarded the first point under fair conditions for providing adequate safety equipment and periodic safety training to workers on their platforms. 

Only BigBasket, Swiggy, Urban Company, Zepto and Zomato were awarded the second point for providing workers with accident insurance coverage at no additional cost, monetary compensation for income loss in cases they are unable to work due to medical reasons other than accidents, and for ensuring a worker’s standing is not negatively affected when they return after a break taken with prior notice to the platform.

Additionally, six out of 11 platforms were recognized for having fair contracts, specifically bigbasket, BluSmart, Swiggy, Urban Company, Zepto, and Zomato. These platforms ensure that their contracts are easy to understand and accessible to workers, and they also have measures in place to protect and manage worker data.

Additionally, five of these platforms such as BigBasket, BluSmart, Swiggy, Zepto, and Zomato - took extra steps to ensure fairness. They notify workers of any contract changes, compensate workers for losses due to app issues, have a code of conduct for subcontractors, and clearly explain pricing factors.

Platforms likeAmazon Flex, BigBasket, BluSmart, Flipkart, Swiggy, Urban Company, and Zomato - have demonstrated fair management practices by providing due process in decisions affecting workers and channels for appealing disciplinary actions ¹ ². This means that these platforms ensure workers are treated fairly and have a say in decisions that impact them.

The report added that representation through a collective body or trade union is a vital dimension of fairness at work. It is disconcerting that despite the rise in platform worker collectivisation across the country over the past six years, there was insufficient evidence from any platform to show a willingness to recognise a collective body of workers.

Consequently, no platform could be awarded a point for this principle this year, according to the report.

Low Earning
Aimed at understanding the financial literacy of the gig delivery workers in the country, a study has revealed that 77.6 per cent of gig delivery workers have reported having an annual income of less than Rs 2.5 lakh. The majority of gig delivery workers, about 61 per cent, have no information regarding the income tax brackets, according to the report by Borzo, a delivery services company.

The report titled, Understanding the financial literacy of gig delivery partners, stated that near about 20 per cent of such workers reported having an income which is in the range of Rs 2.5 lakh to Rs 5 lakh. The percentage of workers having an income of Rs 5 lakh to Rs 7.5 lakh was only 2.6 per cent of the total survey population.

The report is based on the data collected from over 2,000 gig delivery workers across 40 cities in the country.

As far as financial literacy is concerned, only 39 per cent of the gig delivery workers have heard about the income tax brackets. Over 66.5 per cent have never filed an income tax return. Out of 33.5 per cent of gig delivery workers who have filed an ITR, a significant majority of around 66 per cent submitted zero (nil) returns.

The report stated that over 53 per cent of gig delivery workers who filed ITR paid their tax as a one-time payment, while the remaining 47 per cent took to paying taxes in regular instalments.

42 per cent of such workers who have not filed an ITR showed willingness to pay the taxes if the need arises while 58 per cent have no intention of paying taxes even after falling into a tax bracket.

Approximately 75 per cent of the gig delivery workers did not pay any tax, while 20 per cent of such workforce paid taxes which ranged from Rs 12,500 to Rs 25,000. Only 4.6 per cent have paid the taxes ranging from Rs 50,000 to Rs 75,000.

Big Entities' Collaboration And Gig Economy
The success of India's gig economy hinges on the collaborative efforts between large companies and gig workers, experts emphasised at a virtual roundtable hosted by InGovern Research Services on 11 July 2024. India’s gig economy has experienced significant growth due to technological advancements, broad internet connectivity, and the appeal of flexible work with low entry barriers.

A Niti Aayog report projects gig economy jobs to surge from 8 to 18 million to over 90 million within the next 8 to 10 years, potentially contributing approximately USD 250 billion and 1.25 per cent to the GDP. Experts at the roundtable stressed the importance of recognising the interdependence between companies and gig workers. The rise of startups and new-age platform companies over the past decade has created numerous jobs for gig workers.

Despite these efforts, the lack of a dedicated regulatory framework leaves gig workers without essential legal protections and rights. Nirupama Soundararajan, Co-founder and Partner, Policy Consensus Centre noted that large companies have been crucial in transforming unskilled labour into semi-skilled roles through robust upskilling initiatives and diverse skill development programmes. However, ensuring parity between gig workers and full-time employees in terms of social security and benefits remains complex due to the inherent differences in employment structures.

Sarayu Natarajan, Founder, Aapti Institute highlighted the diverse nature of gig work and the need for a nuanced approach to regulation, given the digital mediation that sets modern gig work apart from traditional employment. Advocate K.R. Arun Shabari pointed out the challenges posed by global policies being applied in the Indian context, advocating for a flexible framework that engages all stakeholders.