Rashi Kumari and Intisar Aslam, students at NUSRL, Ranchi. Platform economy has emerged as the new-world gig economy in the changing dynamics of the post-COVID civilization. While the issues of sick leave and low pay remain unaddressed for gig workers, technology has made a swift sweep from physical labor platforms to digital labor platforms. Uber, Swiggy, and other platforms stand at the primacy of location-based applications- a type of digital labor platform- where individuals are tasked with varied service ‘gigs’ like driving or delivering in a particular geographical area. While these location-based platforms have contributed to employing a substantial part of the labor workforce, the ‘unprotected’, ‘unmonitored’, and ‘rating-based’ nature of this apparent employment reflects the dire straits of the plight of platform workers.
The digital labor platforms experienced a significant five-fold increase in their growth between 2010 and 2020. Among these platforms, approximately 8% were based in India. This growth was further amplified by the COVID-19 pandemic, which led to widespread job losses and increased the demand for work opportunities among individuals seeking to support themselves financially. In 2021, the International Labour Organisation (ILO) recently released a report- World Employment and Social Outlook. According to the report, digital labor platforms have a detrimental effect on workers’ rights and their overall well-being. The report highlights how these platforms undermine the rights of workers and negatively impact their quality of life.
This article proceeds broadly in two parts. First, the authors explore how digital platform workers’ cancel-and-charge method is detrimental to the interests of the consumers. It highlights how these employed workers are ‘liberated’ from the legislation by transforming into self-employed workers. Second, the authors explore the aspect of how the ratings ‘restrict’ workers’ livelihood thereby, reflecting the sway that customers and employers hold over the digital platform workers. Lastly, the authors suggest a few policy changes to make India walk towards its aim of achieving inclusive and sustainable economic growth as vowed under the Sustainable Development Goals of the United Nations.
Self-Employed while being Employed: Are Two Distinct Circles Overlapping?
Platform work represents a form of employment that blurs the distinction between being self-employed and being a dependent worker. Platform workers, commonly referred to as own-account workers, face situations akin to employees where they have restricted autonomy over their work. For instance, they may be unable to determine their pricing, mandated to adhere to dress codes, or lack the ability to choose the sequence of their tasks. Additionally, they may experience dependence on their clients or employers in terms of financial aspects. Technology-driven surveillance, with algorithms used like that of rating the driver in the case of Uber/Ola rides, can exert control over these workers.
Most daily commuters must have experienced that there is a common trend in several cities of India, where Uber/Ola/Rapido (“UBR”) drivers cancel the rides booked by the customer or the rider. Later on, the driver generally enquires the rider about the amount that gets reflected on booking the ride and informs him/her that he shall cancel the ride, drop him/her at the destination place, and the rider can pay the reflected amount i.e., the driver would drop the rider at his destination, however, reflecting the employer company that the ride was canceled way before. The reason cited by the driver for such an act is the low pay by the company on each ride he accepts. Resultantly, the rider is hardly concerned as his eventual objective of reaching the place gets fulfilled.
The trend though prima-facie is innocuous but unsettling. The UBR drivers clearly fall within the ambit of the earlier-mentioned dependent workers. However, such acts by the UBR drivers present a complex situation where they aim to elicit independent economic benefits while being employed. It is obvious that a person goes the extra mile to make ends meet and support his living. Contrastingly, this may also result in harm to the riders. The UBR drivers, in this way, while protecting themselves of the benefits and privileges from the employers deprive the rider of the same. Such an act completely absolves the UBR companies of accountability when providing defective or deficient services to its consumers. For instance, the crimes committed by Uber drivers are on the rise. In case of a dishonest driver employing the above method cancellation-charging method, the driver would not only remain untraced by the Uber Company but would also be left unrecorded in the company’s accounts as the ride would have never occurred in the first place. Such a method, therefore, can lead to multifaceted crimes let alone kidnapping as a preliminary crime.
Misclassified and Shackled: The Exploitative Nature of Platform Companies
Booming enterprises like Swiggy, Ola, Zomato have centred their respective market domains around consumer convenience like never before. Alongside this, they have contributed greatly to the Indian platform economy by providing opportunities for ‘contractual and flexible’ labor. However, despite having envisioned an innovative market for the consumers and an autonomous one for workers, certain exploitative practices have emerged in the Indian platform economy which compromise worker well-being. The same shall be addressed in the following paragraphs.
Owing to lack of ingenious legislative classification, platform workers are inappropriately classified as ‘independent contractors’. For instance, Ola refers to their workers as freelance drivers, indicating that the workers can choose to leave at their will. This classification is scrutinized because it allows employers to dodge basic employer-employee responsibilities like conforming to working hours, granting social security benefits like insurance and paid leave, and minimum wages. All the while, there is an element of disguised employment as the ‘independent contractors’ do not enjoy any of the leverage that the label is supposed to entail. Some inequitable terms of Uber and Ola for instance, include lack of any control over fares which is completely determined by Uber, unavailability of knowledge of destinations and thus autonomy of choice in the same.
Secondly, the rating system practised by food delivery platforms like Swiggy and Zomato is used as a hire-or-fire tool of control. The thriving or failing of platform workers depends on ratings and the customers seem to know it. Low ratings reduce the visibility of workers on the platform apart from limiting incentives and bonuses, thus making them essential for drivers to target. Drivers often report having risked self harm or assisted the customer beyond their assigned role in order to get a good rating. Such terms are made possible by click-wrap agreements in which the only option available to potential employers is to select ‘I accept’ in pre-made contracts that restrict the scope of litigation, liability and job security. The unfair working conditions were further highlighted by the ratings of Fairwork India Team in association with Oxford University wherein Uber, Ola and three other platform companies scored a nil in the Index of Fair Working Conditions.
As has been enshrined in the landmark case of Ram Singh And Others vs Union Territory, Chandigarh & Ors., if “an employer retains or assumes control over the means and method by which the work of a contractor is to be done it may be said that an employer-employee relationship exists.” The inequitable terms highlighted above aim to establish that platform companies do exercise the employee-like control but legislative misclassification as independent contractors and lack of protective laws makes platform workers vulnerable to exploitation.
Policy Suggestions: Pitching a Shift in the Current Paradigm
The new labor codes are set to transform the labor-driven economy of India into a new vibrant economy. Section 25 of the Occupational Safety, Health, and Working Conditions Code, 2020 provides for daily and weekly working hours, leave, etc. To evade the menace of the cancel-and-charge method, the scope of Section 25 must be expanded to provide specific working hours for such workers. This will serve two objectives- the first is that the interests of these workers will be protected by a statutory framework limiting the work hours and maintaining their well-being. The second objective can be fulfilled with the support of the employers by taking three steps: (i) devising a framework where the worker is supposed to choose a specific time of the day (morning or evening etc.) to work; (ii) increasing the pay of the workers so that they are not compelled to overwork or seek independent economic benefits out of the “controlled employment”; and (iii) the employers must rope in a robust technology that can track and trace the workers during the specific working hours chosen by them. This will eliminate the possibility of employing the cancel-and-charge method and ensure the passenger’s safety to the maximum extent.
Furthermore, the acknowledged exploitation of platform workers can be addressed by universalizing employment benefits associated with traditional forms of employment. The Social Security Code 2020 has initiated a step in this direction by granting legislative recognition to platform workers. Workers employed via contracts would fall under the ambit of the term ‘employees’ post-enactment. Some steps that can ensure streamlining of laws for adequate protection are: (i) Recognising platform workers as an entirely distinct category of employees instead of placing them under existing heads. This would ensure the flexibility unique to the platform economy while granting much-needed social security. (ii) Innovative financial mechanisms should be introduced in the platform economy to enhance social security through FinTech, NBFCs, micro-financing etc. Such ideas can be implemented via the government’s e-SHRAM portal. (iii) Introducing regulatory mechanisms to ensure compliance of employers with provisions for paid sick leave, health insurance, retirement and pension benefits which are currently not available to platform workers. Such a comprehensive approach will not only ensure a much-needed streamlining of the labor sector but also foster an equitable labor force in India.
The Conclusion
The Indian platform economy is an emerging promise for a much-needed democratization of employment-access since any technologically-enabled individual with a vehicle can gain a source of income. Platform economy, with its low entry barriers, can be a headstart in the greater picture of ensuring the socio-economic upliftment of marginalized social groups. In light of the same goal, the above article concludes having addressed some prevailing issues in the Indian platform economy that make it a compromised environment for consumers as well as workers. Furthermore, through suggested policy implementations, change in legal landscape has been recommended in an economy where the meaning of work is rapidly evolving. With India set to become a 5 trillion economy by 2025, an inclusive platform economy shall be India’s key to achieving this daunting goal while building a labor force capable of pitching its position as a global leader in the manufacturing and services sector.
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