BACKGROUND

On 29 June 2024, the Labour Department under the Government of Karnataka published the draft Karnataka Platform based Gig Workers (Social Security and Welfare) Bill, 2024 (Karnataka Gig Workers Bill), and has invited objections or suggestions in relation to the same, to be furnished by 9 July 2024. The Karnataka Gig Workers Bill aims to inter alia protect the rights of platform-based gig workers by placing certain obligations on aggregators in relation to social security and occupational health and safety as well as contemplates the establishment of a welfare board and creation of a welfare fund for such platform-based gig workers.  Further, the Karnataka Gig Workers Bill also provides for the registration of platform-based gig workers and aggregators in the state of Karnataka.

SALIENT FEATURES OF THE KARNATAKA GIG WORKERS BILL

Key definitions

As per the Karnataka Gig Workers Bill, an ‘aggregator’ is defined to mean “a digital intermediary for a buyer of goods or user of a service to connect with the seller or the service provider, and includes any entity that coordinates with one or more aggregators for providing the services” (emphasis supplied). The definition of ‘aggregator’, as provided for in the Karnataka Gig Workers Bill, departs from the definition that has been used in the Code on Social Security 2020 (SS Code), which is yet to come into force.  The SS Code defines an ‘aggregator’ as “a digital intermediary or a market place for a buyer or user of a service to connect with the seller or the service provider”. The intent appears to include even such entities that liaise with such aggregators, to be included within the scope of an ‘aggregator’ for the purposes of the Karnataka Gig Workers Bill, once the same has been brought into force.

A ‘gig worker’ is defined as “a person who performs work or participates in a work arrangement that results in a given rate of payment, based on terms and conditions laid down in such contract and includes all piece-rate work, and whose work is source through a platform, in the services specified in the Schedule -I”.  The services provided by aggregators, as set forth in Schedule – I include (1) Ride sharing services; (2) Food and grocery delivery services; (3) Logistics services; (4) e-Market place (both marketplace and inventory model) for wholesale/retail sale of goods and/or services Business to Business/Business to Consumer (B2B/B2C); (5) Professional services provider; (6) Healthcare; (7) Travel and Hospitality; (8) Content and media services.  Further, ‘platform’ has been defined to mean “any arrangement providing a service through electronic means, at the request of the service, involving the organization of work performed by individuals at a certain location in return for payment, and involving the use of automated monitoring and decision making systems”.

Relevant provisions governing gig workers and aggregators

As per the provisions of the Karnataka Gig Workers Bill, a platform based Gig worker shall have the right to be registered with the state government on being onboarded with any platform (irrespective of the duration of the work), and shall be provided with a Unique ID applicable across all platforms. In addition, such platform based Gig worker shall also have access to general and specific social security schemes based on contributions made by them (as notified by the state government) and access to a dispute redressal mechanism.

Every aggregator would need to register with the Karnataka platform based Gig Workers Welfare Board (Board), as well as provide its database of all gig workers onboarded or registered to the Board. Furthermore, aggregators are also required to update the Board of any increase or decrease in the number of gig workers engaged by such aggregator.

The Karnataka Gig Workers Bill also contains a provision which stipulates an obligation to enter into fair contracts, whereby all contracts entered into between the aggregator and the Gig workers would need to be written in easily comprehensible language. Further, such contracts would need to be made either in English, Kannada or in any other scheduled language as set out in the Constitution that is known to the Gig worker. The aggregator would need to provide at least 14 (fourteen days) notice before undertaking any change in the terms of contract, and the platform based Gig worker shall have the option to terminate this contract without any adverse consequences for their existing entitlements under the previous contract. The contract must further provide an exhaustive list of grounds of termination or deactivation of the Gig worker from the platform and an aggregator must give prior written notice of 14 (fourteen days) with valid reasons before terminating a Gig worker. It is pertinent to note here that the state government shall publish sector specific guidelines for contracts from time to time and may review contact templates sent by aggregators, on request, in order to ensure fair contracts with the platform based Gig worker.

In addition, the Karnataka Gig Workers Bill also contain inter alia specific provisions dealing with transparency in respect of the automated monitoring and decision making systems, income security, reasonable working conditions, a central transaction information management system, nomination of a point of contact for enquiries as well as a grievance redressal mechanism. Every aggregator, with more than 50 (fifty) platform workers registered on the platform, would need to constitute an ‘Internal Dispute Resolution Committee’ to resolve disputes as set out in the Karnataka Gig Workers Bill. Moreover, aggregators are required to submit quarterly returns in a manner as may be prescribed by the state government.

Fund for Gig Workers and Gig Workers Welfare Fee

The Karnataka Gig Workers Bill also contemplates the establishment of ‘The Karnataka Gig Worker’s Social Security and Welfare Fund’ by the state government for the benefit of registered platform based Gig workers, which shall inter alia receive funds from the welfare fee levied, contributions made by individual based platform Gig workers as well sums received as grant-in aid from the State Government and Central Government. Furthermore, a welfare fee known as ‘The Platform Based Gig Workers Welfare Fee’ shall be charged from the aggregator, which shall be at such rate of the pay of the platform based Gig worker in each transaction or on the annual State specific turnover as may be notified by the State Government.  The aggregator would be required to deposit the welfare fee at the end of each quarter, in a manner as may be prescribed.

KEY TAKE AWAYS

• The Karnataka Gig Workers Bill is still in draft stage, and is open to objections and suggestions.
• The benefits accorded shall be in addition to the ones provided under any other law for the time being in force
• .Whilst the State Government is empowered to prepare sector specific guidelines for contracts to be entered into between the aggregator and the platform based Gig worker, no such guidelines have been prescribed currently in this regard.
• Aggregators operating in the state of Karnataka may consider aligning its practices in accordance with the provisions of the Karnataka Gig Workers Bill, so as to facilitate an ease in transition, once the same has been enacted and brought into force.
• Whilst the Karnataka Gig Workers Bill empowers the state government to formulate rules, no such draft rules have been published by the state government in furtherance of the proposed Karnataka Gig Workers Bill.