The rise of the gig economy has resulted in the employment of vast numbers of workers who are not formally employed by companies, but work hard for them. Think Uber, Ola, Zomato , Swiggy and others, with their armies of drivers and delivery boys. They simply do their jobs for money, and this money depends on how hard they work. Should they not have some of the employment benefits that regular employees do? That is what’s proposed by India’s Code on Social Security Bill, 2019, which recognizes “gig workers" and “platform workers" as workers, and insists that they be entitled to such benefits as life and disability cover, maternity leave and old age protection.

Gig workers who work long hours for little money should be pleased. Many of them live hardscrabble lives, and any security for them is welcome. They are, after all, dependent on the companies that use their services. California has recently passed a law that endows such workers—who operate on contracts—with benefits that regular employees get.

However, there’s a catch. What’s good for workers might prove bad for the gig economy’s expansion. New provisions would impose raise the wage bill of gig players, whose business models typically involve crushing costs to be able to offer super-cheap services. They also need their staff size to be flexible and adaptive to market demand. The new regulatory burden will put many business models at threat. It would also reduce the flexibility of a part of India’s labour market that has so far escaped its usual rigidities. The pace of hiring could drop and job availability may decline. But then again, gig workers deserve better terms. Perhaps a mechanism can be evolved that balances everyone’s interests.

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