A recent report in this newspaper pointed to how food delivery platforms are experiencing a shortage of ‘gig workers’ (freelance workers in the new economy), who are now looking for better pay and less restrictive working conditions. With their remuneration being squeezed amidst harsh inflationary conditions, their search for better options within the new economy universe, which offers a wide range of services, is only to be expected. Some of them who returned to their villages in the wake of Covid are weighing their options. But there could be a bigger theme at work here: are we seeing the end of the so-called ‘platform economy’ boom? A turn in the rate cycle worldwide and an end to cheap liquidity has meant that private equity and venture capital funders are examining valuations more closely. Till only recently, start-ups flush with funds raised from venture capital and private equity were generous in providing both a ‘fixed’ component and ‘incentives’ to their gig workers. Now, start-ups are cutting incentives. Food and grocery delivery businesses apart from e-commerce delivery players are getting impacted as the workers are quitting in droves.

The work environment of gig ‘workers’ has been a subject of considerable global debate and litigation – the bone of contention being whether the platform has an employer-like obligation towards its hired workforce. In 2018, a California court ruled that Uber and Lyft treat their workers as employees and not merely as independent agents or contractors. A legal resolution to this issue in the Indian context is called for. Much has been made of the Social Security Code (SSC)’s extension to the ‘gig’ and ‘platform’ workers, while they do not figure either in the Industrial Relations Code or the Occupational Safety, Health and Working Conditions Code. What this statutory framework means is that they are entitled to social security but not labour rights. To avail themselves of social security, they have to update their particulars on a portal. A national database of such workers, whose numbers today are in the realm of speculation, is called for. Compulsory nomination to the National Social Security Board, as suggested in the SSC, should be enforced.

Today, the new economy sectors which flourished in the work-from-home and shop-from-home milieu of the pandemic are faced with a crisis as the economy gradually returns to normal. Restaurants, seeing a return of footfalls, would rather not part with the commission that food delivery operators charge. Meanwhile, platform players, faced with no real expansion of their customer base, want to continue charging their hefty commissions from delivery workers despite rising fuel and other prices. It is another matter that their failure to generate credible returns from the oodles of easy money at their disposal has never been explained. There are signs of change, though. Zomato has set up a corpus of ₹700 crore where any delivery partner who has been with the company for five years gets ₹50,000 per child per annum. A system of promotions in ride hailing operators has been introduced. However more needs to be done. Besides greater regulatory intervention, companies too need to tweak their business models.

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