1. Introduction: -The Karnataka government has recently implemented the Karnataka Platform-Based Gig Workers (Social Security and Welfare) Act, 2025 and the accompanying Rules. These regulations establish a comprehensive framework for the governance of the digital platform economy, specifically targeting social security for gig workers. The Act, effective from 30 May 2025, aims to ensure welfare and security for gig workers by defining engagement terms between ‘aggregators’ and ‘platforms’ while setting minimum standards for transparency, safety, and grievance resolution. It introduces a welfare fee on aggregators and establishes the Karnataka Platform Based Gig Workers Welfare Board, comprised of various stakeholders including gig workers and civil society members, ensuring diverse representation.
The Rules facilitate the operational aspects of the Act, detailing procedures for registration, reporting, grievance handling, and compliance. This initiative aligns with the Union Government’s Social Security Code, 2020, which acknowledges gig workers and requires aggregator contributions. The implementation of the Act necessitates integration with the existing SS Code framework. The update covers the regulatory scope, Gig Workers’ rights, aggregator obligations, the relationship between the Act and the SS Code, and the current status and challenges of implementation.
2. Regulatory scope of the Act :- The regulatory scope of the Act significantly expands the definition of an ‘aggregator’ beyond that specified in the SS Code and the Motor Vehicles Act, 1988. The SS Code and the Motor Vehicles Act define an aggregator as a digital intermediary or marketplace facilitating connections between buyers and sellers or between passengers and drivers, respectively. In contrast, the Act encompasses a broader range of entities, not only digital intermediaries but also those coordinating with such aggregators to provide services. This expanded definition is expected to bring a larger variety of entities under the regulatory framework of the Act in comparison to the SS Code.
3. Rights of Gig Workers under the Act and Rules :- The document outlines the rights of Gig Workers under a specific Act and accompanying Rules. Key provisions include:
1. Registration: Gig Workers must be registered with a designated Board upon onboarding to any platform, receiving a unique identification number for cross-platform operation.
2. Access to Social Security: Registered Gig Workers qualify for both general and specific social security schemes provided by the Board, encompassing life insurance, accidental benefits, disablement benefits, medical benefits, maternity benefits, and old-age protection.
3. Grievance Redressal: The Act mandates the establishment of an internal dispute-resolution committee with equal representation from aggregator/platform management and Gig Workers. Additionally, the Board offers a grievance redressal mechanism as an appellate option.
4. Income Security: Gig Workers are guaranteed timely payments at least weekly, and any deductions must be explicitly detailed on payment documents.
5. Fair Contracts: Contracts with Gig Workers are required to be fair, transparent, and comprehensive, stipulating changes with a minimum of 14 days’ notice. They must also outline clear grounds for termination.
6. Due Process in Termination: A Gig Worker’s contract termination demands a notice period of 14 days with written justification, adhering to principles of natural justice. Immediate termination is permissible only in cases of bodily harm or specific offenses defined under current law, including fraud and those designated by the Board.
4. Obligations of Aggregators and Platforms: – Aggregators and platforms are mandated to register with the Board within 45 days following the enforcement of the Act, with a possible extension of 30 days for technical reasons. They are required to electronically submit a machine-readable database of all Gig Workers within the same timeframe. Additionally, a welfare fee ranging from 1% to 5% of each transaction’s payment to the Gig Worker must be contributed, with specific rates determined for each sector within 6 months of the Act’s enforcement. This information, along with payment details and welfare fees, needs to be uploaded onto the Payment and Welfare Fee Verification System (PWFVS).
Measures must be enforced to prevent discrimination based on religion, race, caste, gender, place of birth, or disability within algorithmic processes. Furthermore, platforms must ensure occupational safety and health (OSH) by providing a safe working environment, sufficient rest periods, and sanitary facilities. The Board will establish sector-specific OSH standards which must be adopted within 3 months. Safety features, including guidance, panic buttons, training, and adherence to the Sexual Harassment of Women at Workplace Act, 2013, are also necessary.
Platforms are obliged to disclose grievance and dispute resolution mechanisms, offer a human point of contact that supports multiple languages (at least Kannada and English), and provide key information on insurance, welfare schemes, fee deductions, termination, and handling of complaints related to physical harassment. Additionally, they must publish information about how Gig Workers can access data regarding their earnings and customer feedback.
5. Interplay between the Act and the SS Code:- The SS Code recognizes Gig Workers and introduces central social security schemes funded through government allocations, a 1%-2% aggregator levy on annual turnover (capped at 5% of Gig Workers’ payments), corporate social responsibility contributions, and additional sources. It also expands the National Social Security Board to include representatives from aggregators and Gig Workers, establishing a Central Social Security Fund. Importantly, the Act does not replace this framework but serves as an addition, allowing the coexistence of central schemes under the SS Code with state-level benefits. A significant aspect is the Act’s provision that the state welfare fee paid by aggregators counts towards the “total contribution payable” under the SS Code, with yearly reconciliations permitted. Additionally, the Rules facilitate offset and reconciliation for welfare fees owed to the Karnataka State Government or the Union Government. Ultimately, the Act aims to create a unified contribution system for Gig Workers’ social security, minimizing the risk of double payments while enabling benefits layering, which will depend on future central notifications and reconciliation processes.
6. Implementation status and practical challenges:- The implementation status of the statutory framework for platform-based gig work in Karnataka faces significant challenges, hindering its practical enforcement. Key components essential for enforcement remain pending, directly affecting how platforms and gig workers will experience the law’s effects. Notably, a Board for overseeing the process has not been constituted, preventing the registration of platforms and workers, as well as the issuance of unique identification numbers. Additionally, the required registration portal for aggregators and platforms is yet to launch, which obstructs the registration process and data uploads of gig workers. The Program for Welfare and Financial Support for Workers in the Sector (PWFVS) is not operational, complicating the mapping of payments and welfare fees. Social security benefits are also stalled, reliant on notifications from the non-existent Board. While the legal framework marks a pivotal shift towards formalization and enhanced worker protection, its impact will not manifest until the Board is operational and the relevant schemes are active. The legislation represents a significant stride in extending social security to this burgeoning workforce segment, with the potential for broader adoption by other states, fostering a more cohesive approach to gig worker welfare. The ultimate effectiveness of this framework will hinge on its practical implementation and enforcement.
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