New Social Security Code and Its Impact on Gig Workers
INTRODUCTION
India’s labour law landscape has undergone a significant transformation with the enactment of the Code on Social Security, 2020 (commonly referred to as the New Social Security Code). For the first time, Indian labour legislation expressly recognises gig workers and platform workers, marking a crucial shift towards inclusion of the informal and app-based workforce within the social security framework.
Recognition of Gig and Platform Workers
The Code defines gig workers as individuals who perform work outside the traditional employer–employee relationship, and platform workers as those engaged through online platforms such as ride-hailing, food delivery, or digital freelancing portals. This statutory recognition is important because it acknowledges that modern work arrangements do not fit neatly into classical labour law categories.
Instead of extending all benefits available to regular employees, the Code adopts a scheme-based approach. It empowers the Central and State Governments to notify welfare schemes for gig and platform workers covering areas such as life and disability insurance, health and maternity benefits, old-age protection, and accident insurance. The schemes may be funded through a mix of government contributions and a prescribed contribution from aggregators (platform companies).
Obligations on Aggregators
A notable feature is the imposition of financial responsibility on aggregators. The Code provides that aggregators may be required to contribute a percentage of their annual turnover (subject to a cap) towards social security funds for gig and platform workers. This reflects a policy shift that places partial welfare responsibility on digital platforms that derive economic benefit from gig labour.
Registration and Implementation Challenges
To avail benefits, gig workers must be registered on a designated portal. While this enables targeted welfare delivery, it also raises concerns regarding digital access, awareness, and administrative efficiency. Further, since most benefits depend on schemes yet to be fully operationalised by States, the practical impact of the Code remains uneven across India.
Limitations and Legal Concerns
Crucially, the Code does not confer employee status on gig workers. As a result, core labour protections relating to minimum wages, collective bargaining, and job security remain outside its scope. Critics argue that the scheme-based model offers discretionary welfare rather than enforceable rights, potentially limiting long-term protection.
Conclusion
The New Social Security Code is a progressive step in recognising gig workers within India’s legal framework. However, its success will ultimately depend on effective rule-making, timely notification of schemes, adequate funding, and robust implementation to ensure that recognition translates into real social security on the ground.
FAQs
1. Does the Social Security Code make gig workers employees?
No. Gig and platform workers are recognised as a separate category, not as employees.
2. What benefits can gig workers expect under the Code?
Benefits may include insurance, health coverage, maternity benefits, and old-age protection through notified schemes.
3. Are platform companies required to contribute?
Yes. Aggregators may be mandated to contribute a portion of their turnover towards social security funds.
4. Is registration mandatory for gig workers?
Yes. Registration on the prescribed portal is required to access benefits.
5. Is the Code fully implemented across India?
Not yet. Implementation depends on framing of rules and schemes by Central and State Governments.
