In its short life, the gig economy has done a lot of good deeds. It has changed the way we live, opened up jobs and efficiencies, created wealth and increased income. But there has also been increased unease about the status of the gig worker, who is outside the normal employer-employee relationship and its safeguards. For an Internet platform, the typical gig worker is a “partner”, not an ’employee’, whether it is carrying passengers around or delivering food to homes. In the early days, it seemed like a win-win for all involved—the self-employed worker who found a way to earn money, the platform that generated the revenue, and the consumers whose needs were being met. The honeymoon between the first two did not last, as the power disparity between occupations and workers began to assert itself. Gig work came to be seen as an unsustainable source of livelihood. In many countries, there has been policy pushback, forcing firms to assure better conditions to such workers. Last year, the UK’s top court ruled that Uber drivers, its employees, are entitled to labor rights, a minimum wage and paid leave. The European Union has also pushed for better working conditions. In India, discontent is brewing. Urban Company’s partners recently worked to protest low wages and poor security. Gig worker attrition ri . Sing fuel bills reduce earnings as well. In this context, a new report of NITI Aayog on this sector is highly relevant.
The government think-tank report puts India’s gig workforce at 7.7 million in 2020-21, 1.5% of the country’s total, a number that is projected to rise to 23.5 million by 2029-30, when they 4.1% will be accounted for by workers. To address the HR problems of the gig sector, the report suggests that we should motivate companies to create a better deal for them. Drawing upon various approaches adopted across the globe, it offers a minimal basket of protections, from paid sick leave to health insurance. It also wants the platform to consider retirement benefits as well as insurance cover for work accidents. It recommends that a fund of funds be set up to support workers during emergencies. To open up career avenues, it says, governments can offer them institutional loans for entrepreneurial ventures. None of this is binding on the platforms that rent their services. But this is our clearest sign yet that gig employers can’t get away from their old claim that these are spot-job hires for whom they bear no more responsibility than the small tasks assigned to them. All app-based aggregators must embrace a dependency that evolves, and once we put aside the imagination of gig workers being free agents, Compact’s disparity screams for improvement.
It is another matter that the path to regulatory overkill is often paved with good intentions. Therefore, the government should not overburden a sector whose success in job creation and value creation speaks for itself. In fact, the platform model emerged by turning a large portion of its pay bill into a variable cost, thereby keeping most of the internet spending low and being scaled up cheaply. In a country with abundant labor, this offered a distinct edge that would be tarnished if platforms were forced to take care of gig workers the way other companies take care of careers. Nevertheless, the current stance of such firms is largely untenable, even exploitative; Delivery agents who worry about expensive petrol often fail to report the breakdown of the vehicles they use. As argued by NITI Aayog, there need not be a trade-off between worker safety and platform profits. It’s time for a new deal.