The Karnataka State Labour Department is scheduled to meet with all stakeholders and aggregators, next week, to discuss the welfare fee and other details of the Karnataka Platform-Based Gig Workers (Social Security and Welfare) Ordinance.

The ordinance was introduced in the cabinet earlier this year and received the Governor’s approval in May 2025.  If enacted, the bill would make Karnataka the second State in India to legislate for the social security and welfare of platform-based gig workers after Rajasthan.

The move is aimed at supporting the Karnataka Gig Workers Social Security and Welfare Fund and will require the platforms to pay a welfare fee, referred to as the Platform-Based Gig Workers Welfare Fee, ranging between 1 per cent and 5 per cent of each payout made to gig workers.

Even though the State government is yet to finalise the fee, industry sources, on condition of anonymity, told businessline that the government is looking to introduce a tiered welfare fee for aggregators basis on payout models deployed for gig workers.

Welfare fee difference

Platforms operating on software-as-a-service (SaaS) models, such as ONDC and Namma Yatri, which rely on subscription-based fees instead of charging commissions per transaction, may be subject to lower welfare fee rates in the range of 1–2 per cent. In contrast, commission-driven aggregators like Swiggy, Zomato, Zepto, Ola, Uber, Amazon and Flipkart could see higher welfare fee rates, potentially reaching up to 5 per cent, depending on their revenue models and transaction volumes.

Karnataka Labour Minister Santosh Lad acknowledged that the rules are still being finalised. “There’s no clarity yet. What I feel in simple terms is, lower fares, especially in transport, could mean a lower welfare fee. If the value or sales are higher, then the welfare fee can be slightly higher. But this is just the beginning. The rules are currently with the Secretary, and they will come to me in a couple of days. We won’t take a hasty decision. We will consult everyone, take suggestions, and only then finalise the structure,” he said.

While it’s still unclear how the welfare fee would be accounted for the platforms,the fee would trickle down to the end users of the platform.

Published on June 12, 2025