By Gayatri Singh, Akhil Surya
As new and myriad forms of employment come into play, it is essential that we critically rethink what a “traditional employer-employee relationship” means and analyse these forms by broadly interpreting an “employment relationship” under the existing labour laws.
In India, the Industrial Disputes Act, 1947 defines “workman”, in the broadest terms, “as any person” who is employed for “hire or reward” in any industry to do any “manual, unskilled, skilled, technical, operational, clerical or supervisory work.” The determining criterion for the existence of an employment relationship and the scope of the definition of “workman” has never been static. With time, as new forms of employment emerged and came to be tested against the then existing labour laws, the criterion for what constituted an employment relationship became broader, more liberal, and more aligned with the socioeconomic realities of the work. Since the 1960s, various classes of workers, such as beedi workers and contracted tailors, who were initially not considered as “workmen”, were brought under the rubric of existing labour laws and became entitled to various rights, benefits, and protections.
Alongside the tests of performing the work for someone else and being paid remuneration, the sufficient control and supervision test, the power to punish for breach of codes of conduct test, and the independent trade, occupation or business test), the integration test (that the worker is totally integrated into the work and economic organization of the other, i.e., industry), and the ownership of key assets test (that the ownership of key assets involved in the work belonged to the industry- in this case the algorithm) evolved as means for determining whether there existed an employment relationship. These crucial assessments continue to be relevant for any new form of employment.
The digital platform economy is a classic example of how meticulously platforms have succeeded in disguising the employment relationship. The terms and conditions set out in the contract are decided by the platforms and the workers have no say in deciding, intervening, or effectively challenging the same.
Platforms themselves hold the power to classify their workers and thus they are referred to as anything but workers, often misclassified as partners, agents, independent contractors, and so on. Concomitantly, they (mis)classify themselves as facilitators, digital intermediaries, special technology platforms, and so on. The disguising of the underlying employment relationship disentitles the platform worker to any rights and protections from the existing laws.
International Labour Organisation’s (ILO) Employment Relationship Recommendation, 2006 (No. 198) stipulates that national policy should “at least” include measures to combat disguised employment relationships where the employer treats an individual as other than an employee in a manner that hides their true legal status as an employee and where the effect is of deprivation of rights and protections to the employees where they are due.
Framed in 2006, when platform work had not evolved into as many myriad forms as it has in the recent past, the Recommendation was criticised for how it defined disguised employment relationships. Albeit its shortcomings, the Recommendation is an important international instrument for determining the existence of an employment relationship.
As things stand on the national legislative plane, the Code on Social Security, 2020 (‘CoSS’) defines “platform workers” as being “outside of a traditional employer-employee relationship.” ILO Recommendations are non-binding and India has not formally adopted the Recommendation No. 198. However, with the passing of the CoSS, India, by virtue of being a member of the ILO, has evidently flouted its minimum moral and political commitment by acquiescing to the disguised employment relationship.
On the other hand, other countries are taking steps towards framing laws to recognise platform workers as workers. The State of California has already passed a law, known as the California Assembly Bill 5 (‘AB5’), that lays down a presumption of employment status and places the burden upon the employer to prove otherwise by satisfying all three conditions of the ABC test (A – that the individual is free from its control, B – that the individual is performing work outside their usual course of business, and C – that the individual has an independently established trade and business).
Where the employer fails to satisfy the three conditions, the platform workers automatically become entitled to various labour benefits. However, even as the Bill survived a challenge before the Supreme Court, by a ballot measure known as Proposition 22, employers of “app-based ride-share and delivery drivers” were exempted from AB5.
Similar to AB5, Directive (EU) 2024/2831 of The European Parliament and of The Council On Improving Working Conditions in Platform Work, which is yet to be implemented, lays down a presumption of employment status and places the burden upon the employer to prove otherwise.
Material conditions of the arrangements between the platform workers and the platforms in India, progressive judicial decisions on the existence of employment relationship, ILO Recommendation No. 198, and international examples clearly point to the fact that the platform workers are in an employment relationship with the platforms.
In this light, we now turn to the issue of the right to social security. In international law, the right to social security is strongly affirmed. Articles 22 and 23 of the Universal Declaration of Human Rights (‘UDHR’), 1948, to which India is a signatory, affirms that every member of society has a right to social security, and right to work, right to just and favourable conditions of work, right to just and favourable remuneration, right to equal pay for equal value of work, including the protection against unemployment, and also the right to form and to join trade unions, respectively.
The International Covenant on Economic, Social and Cultural Rights (1976) (‘ICESCR’) to which India is a party also recognises the “right of everyone to the enjoyment of just and favourable conditions of work”, including fair renumeration, equal renumeration for equal value of work, decent working conditions, safe and healthy working conditions, rest, leisure, reasonable limitation of working hours, and periodic holidays with pay (Article 7). Most importantly, Article 9 expressly stipulates that “the State Parties to the present Covenant recognize the right of everyone to social security.”
India, as a State Party, commits to the recognition of the right of everyone, including platform workers, to social security. It is also relevant to note that ILO Occupational Safety and Health Convention 1981 (No. 155), which India has not ratified, covers all employed persons engaged in all types of economic activities.
Further, the ILO Social Protection Floors Recommendation, 2012 (No. 202), which reaffirms that the right to social security is a human right, provides guidance to the member states to establish and maintain social protection floors as a fundamental element of their national social security systems and ensure progressively higher levels of social security for all. The Recommendation lays down four constituents of the minimum floor: access to essential health care, including maternity care; basic income security for children providing access to nutrition, education, and care and other necessary goods and services; basic income security for persons in active age but are unable to earn sufficient income, particularly in cases of sickness, unemployment, maternity, and disability; and basic income security for older persons. Needless to say, platform workers in India do not have meaningful access to these elements that form the floor of social security, as India has no statutorily enforceable program of social security for the platform workers.
On the plane of the meaningful realisation of the nation’s ground norm i.e., the Constitution, the situation is no less bleak. Article 21 of the Constitution, which refers to protection of life or personal liberty, has been broadly interpreted to include right to health and right to decent living conditions. In Consumer Education & Research Centre & Others v. Union of India, 1995 SCC (3) 42, it was held that the right to health and medical care, to protect health and vigour while in service or post-retirement, is a fundamental right of a worker under Article 21, read with Articles 39(e), 41, 43, and 48A of the Constitution. Needless to say, the said fundamental rights extends to platform workers as well.
The ILO Equality of Treatment (Social Security) Convention 1962 (No. 118) lists out nine branches of social security.* The statutory realisation of fundamental right to health and medical care of a worker, along with the nine components of social security as delineated by the ILO, can be found in the Employee State Insurance Act, 1948 (‘ESI’), Employees’ Provident Fund and Miscellaneous Provisions Act, 1952 (‘EPF’), Payment of Gratuity Act, 1972 (‘PoGA’), and the Maternity Benefit Act, 1961 (‘MBA’), alongside various other sectoral labour laws.
These legislations are applicable only to those who are recognised as “workers” and all the legislations lay down a minimum threshold for the number of workers in that particular establishment/ industry for the statute to apply (10 for ES1, 15 for EPF, 10 for PoGA, and 10 for MBA). These limitations are carried forward with the passing of the CoSS.
Section 114 of the CoSS provides for framing of “suitable welfare schemes” for platform workers and lists out matters on which such schemes are to be made in the most generic and simplified of ways. Four points glare at us on a meaningful reading of Section 114 of the CoSS as against the nationally and internationally recognised right to social security.
Firstly, the Section vests the Central Government with only a discretion, not any duty and concomitantly not any right to the platform workers, by adopting a “may” clause.
Secondly, the Section vests this domain exclusively with the Central Government. Unlike Sections 114 and 109 of the CoSS, which apply to “unorganized workers” (which does not include platform workers as they are “outside of traditional employer-employee relationship”), Section 114 adopts a “shall” clause and involves both the Central and State Governments.
Thirdly, the Code does not lay down any minimum social security floor to which the platform workers are entitled to as a matter of right and below which the State cannot abstain from action. This is at stark odds with the ILO Social Protection Floors Recommendation, 2012 (No. 202).
Lastly, Section 109 of the CoSS is substantially similar with the respective provisions in the Unorganized Workers Social Security Act, 2008 (‘UWSSA’), and Section 114, which applies to gig and platform workers, is a simple extension of Section 109. In over a decade and half, the UWSSA has not reached nearly 94 percent of the unorganised workers with at least some or the other form of social security.
Replicating and making the same provisions applicable to a newer class of workers, with no substantial changes, does little to ensure that the CoSS does any better than cover only 6 percent of the unorganised workers like the UWWSA. Despite being a statute “with the goal to extend social security to all employees and workers”, the CoSS neither vests any enforceable right with the platform workers to social security, nor does it require the State to provide for a social protection floor.
Instead of ensuring an all comprehensive statutory social security program for platform workers, the Central Government seems to have deemed the e-SHRAM Portal a sufficient step towards recognising and providing for a right to social security for the platform workers.
The e-SHRAM Portal, a national database of unorganised workers including migrant workers, construction workers, agriculture workers, and gig and platform workers, provides a single window for its registered members to various Central Government schemes. The entire working of the e-SHRAM Portal is premised on voluntary and self-registration of platform workers. Though platform workers are registering themselves in the hope of being covered under some or the other scheme, the distance between the promise presented by the Central Government in the Portal and its reality has not been a subject of necessary and serious discussion.
The e-SHRAM Portal integrates two categories of schemes: Social Security Welfare Schemes and Employment Schemes. In neither category there is a scheme specifically for platform workers, tuned to their needs and working conditions. Of the thirteen social security welfare schemes, none are universal in which platform workers could be covered without any restriction.
Platform workers, simply by occupation, are not entitled to six (which concern farmers, weavers, manual scavengers, etc.)** of the thirteen schemes. The remaining seven of thirteen schemes are exclusionary by design and checkered with different eligibility criteria based on caste, income, and so on.
Behind the grandiose surrounding the e-SHRAM Portal as the panacea for the plight of platform workers is a simple truth: being ‘registered’ under the e-SHRAM Portal is no guarantee that platform workers are provided with social security, as one has to be specifically ‘eligible’ for each of these seven schemes.
In fact, the e-SHRAM Portal is not even fulfilling its basic promise: to be a comprehensive database of all the informal and unorganised workers, as it is still unknown how many platform workers have been registered. The platforms continue to refuse to provide the required data of the number of workers engaged by them and the Union Government presents no fixes for platforms evading accountability, even in the teeth of the Information Technology Act, 2000.
Above all, the lack of enforceability and accountability mechanisms in the e-SHRAM Portal, and the fact that its integrated schemes can be dispensed with by the Executive at any time (as they are not statutory guarantees), leads us to the conclusion that platform workers have no right to these schemes.
It is claimed by the Central Government that the Ayushman Bharat-Pradhan Mantri Jan Arogya Yojna (‘AB-PMJAY’) is applicable to platform workers. Though it is one of the thirteen social security schemes integrated with the e-SHRAM Portal, it does not cover ‘platform workers’ as a class. Each individual platform worker has to meet the eligibility criteria of the scheme to avail its benefits.
PMJAY seeks to provide a cover of Rs. 5 lakhs per family per year for secondary and tertiary care hospitals covering public and private empanelled hospitals in India. In 2022-23, the scheme covered 58.8 crore individuals with a budget of Rs. 12, 000 crores. Its services are limited to approximately 1,929 procedures across 27 medical specialties. Usually, the costs are shared between the Central and State Government in the ratio of 60:40.
Though states have the flexibility of expanding the coverage in line with the existing healthcare schemes, most states are facing a financial crisis. For instance, Maharashtra has made budgetary cuts in the health schemes as a result of which it has been unable to settle the bills of private hospitals since July 2024. Due to non-payment of hospital bills, many of the beneficiaries are being denied the benefits under PM-JAY.
Be that as it may, despite the National Health Policy, 2017 having ‘Universality’ of healthcare as one of its key principles, PM-JAY, by design, is an exclusionary scheme, even as it claims/ aspires to be a universal scheme, and by any extension, not a healthcare scheme that is framed with the needs and working conditions of platform workers in mind. Therefore, it is apparent that even PM-JAY, which is the only security which the platform workers can have access to, is beyond their reach and therefore platform workers have no meaningful access to effective social security schemes.
Years of disguising the employment relationship has solidified into the text of the law, i.e., CoSS, as platform workers are now placed “outside of a traditional employer-employee relationship.” Even as platform workers are so placed, nationally, the platforms must be required by law to monetarily contribute their share in state social security measures.
The failure of the State to regulate these platforms has given them a free pass to continue keeping platform workers virtually under material conditions of forced labour. What is even more egregious is that the platforms are not even bound to disclose the basic data regarding the staff they employ. The opacity that surrounds the algorithms deployed by the platforms also keep the conditions of work and underlying logic of automated decisions under secrecy.
Overall, this has emerged because of the State’s inaction in fulfilling the rights of platform workers. Even as national-level measures of this kind are elusive at the moment, the possibilities of framing and implementing positive interventions at the state-level, particularly in regulating working conditions and providing social security to platform workers, are immense.
After Rajasthan (The Rajasthan Platform Based Gig Workers (Registration and Welfare) Act, 2023), very recently, Karnataka promulgated The Karnataka Platform-Based Gig Workers (Social Security and Welfare) Ordinance, 2025. The provisions on the platform-based gig workers welfare fee (a fee of 1-5 percent of per-transaction payout to the platform worker), the Gig Workers Welfare Board, the Payment and Welfare Fee Verification System (‘PWFVS’), grievance redressal mechanism, especially against deactivations, and most importantly, on fair contracts and algorithmic transparency make the Ordinance a mighty encouraging initiative.
As promising legislative processes in other states are underway, algorithms must remain in emphasis for all purposes of fulfilling the platform workers’ right to social security and safe and decent working conditions. (IPA Service)
Courtesy: The Leaflet
