Unregulated platformization of labour is undermining workers’ rights

The evolving world of work

Adoption of digital technology is rapidly influencing the way businesses are conducted globally. The COVID-19 pandemic has further fuelled this transition, especially in large metro areas and second-tier cities where more and more people prefer to order goods and services online. This has led to an increase in gig and platform work. The Associated Chambers of Commerce and Industry of India found that in 2020 there were 15 million gig workers throughout the country.

The upsurge of gig and platform companies is fast creating a new business ecosystem where customers have an enhanced experience of a variety of goods and services from the comfort of their homes, including cheaper mobility options. But the millions of gig and platform workers who make this a reality remain deprived of any minimum income guarantees and adequate social protection. Absence of social dialogue and tangible employer-employee relationship adds to their woes. Luring under the garb of fancy job titles – delivery partners, driver partners and independent contractors to name a few – these workers are left vulnerable to fend for themselves in times of crisis as witnessed during the COVID-19 pandemic.    

New age employment model deprived of ‘decent work’

65 per cent of India’s population is below the age of 35. While this augurs well for the potential economic growth of the country and ensuing benefits of the demographic dividend, the reality is somewhat different.  India’s demographic dividend has become a challenge as not enough jobs are available to offer employment to all new entrants in the labour market.  Two years after the COVID-19 pandemic, getting employment has become an enormous challenge for millions of displaced Indian workers. The new ray of hope are the work opportunities created by the fast-expanding gig and platform economy.  

The rise of such employment has caught the attention of researchers, academia, policy makers, think tanks and labour rights’ activists, world over. These jobs offer increased flexibility and independent working, factors which tend to attract young workers. But on the darker side, these are the workers who end up putting in long hours of work, earn meagre incomes, get no social protection, and are subjected to poor occupational health and safety conditions. The workers at times even risk their lives to complete time-bound tasks, like those of app-based drivers engaged in delivery of food and other goods and services. According to the Fairwork India report 2021, only one company out of eleven scores above five on the fairwork scale of 1 to 10, which rates platforms as per the principles of fairness in pay, conditions, contracts, management and representation.

Soft victories and regulation are catching up – global lessons

The unabated growth of the platform economy is now being met with voices of dissent across countries. Workers have started to stand up for their rights and have been drawing the attention of lawmakers to initiate measures and safeguard their interests. Individual lawsuits and collective action are coercing governments to provide more clarity especially around the status of workers and their rights. Affirmative pro worker decisions in court cases in England, the Netherlands and Germany along with legislative initiatives in Italy, France and Spain are setting the stage and encouraging lawmakers elsewhere to ponder upon improving working conditions of workers in this sector. In a significant development, the European Commission in 2021 drafted a directive aimed at improving working conditions in platform work across the entire European Union.    

In some Asian countries as well, for example India, China, Pakistan and Singapore, efforts are underway to address some of the prevailing issues.

Regulating the unregulated    

More than 90 per cent of India’s workforce lies in the informal economy. The unregulated growth of the platform economy has the potential to usher a new wave of an informal workforce and therefore is a cause of concern.

The gig and platform economy is still evolving in the country. The examples of clarity on workers status and attempts of regulation are emerging from the world paving way for other countries to adapt and/or think of regulation to suit their local conditions.

In the Indian context, the coverage of gig and platform workers in the Social Security Code, 2020 (awaiting implementation) is a welcome step and raises hopes of these workers of some form of social protection in the immediate near future. However, more needs to be done to ensure their rights of better working conditions – minimum pay, occupational health and safety and exercising rights at work.  

Going forward, policy makers should consider initiating social dialogue with all the tripartite constituents and other like-minded stakeholders with the objective of identifying ways of regulating the platform economy. Of course, any regulation should not stifle the business or in no way act as a deterrent to fresh capital inflow. What is needed is a balanced approach, one which does not hinder continuity of business and yet, at the same time, does not compromise basic workers’ rights and decent working conditions.