Authored By: Archee Samaiya
KLE Society's Law College, Bangalore
ABSTRACT
In recent years, the world has witnessed an unprecedented transformation in the nature of work. The rise of the gig and platform economy—characterized by short-term, task-based engagements mediated through digital platforms—has fundamentally altered the employer–employee relationship. Millions of Indians now earn their livelihood through platforms such as Swiggy, Zomato, Ola, Uber, Amazon, and Urban Company. While this new economic model offers flexibility and autonomy, it has also created a precarious class of workers without job security, social protection, or collective bargaining rights.
The enactment of the Code on Social Security, 20201 represents the first significant attempt by the Indian legislature to extend the umbrella of social welfare to these workers. This article critically examines the evolution of the gig economy in India, analyses the legal recognition accorded to gig and platform workers under the Code, evaluates judicial and policy responses, and compares international approaches to regulating digital labour. It further explores the social and economic implications of this emerging labour model, identifies the implementation challenges, and proposes reformative suggestions to ensure inclusive protection.
The study concludes that while the Social Security Code, 2020 marks a commendable step toward universal welfare, its success depends upon effective enforcement, participatory governance, and a shift in the state’s regulatory approach from passive observation to proactive protection of workers’ rights.
KEYWORDS: Gig economy, Platform workers, Social Security Code 2020, Labour protection, Digital employment, Legal reform.
INTRODUCTION
Work has always been central to human existence, yet its meaning and structure have continually evolved. The twenty-first century marks a dramatic shift from conventional employment toward flexible, digitalised, and on-demand work structures. The gig economy—derived from the colloquial expression “gig,” meaning a short performance—represents a marketplace in which temporary, freelance, or project-based work is performed, often mediated by technology.
India, one of the fastest-growing digital economies in the world, has become a major hub for gig work. According to the NITI Aayog Report (2022)2titled India’s Booming Gig and Platform Economy, the country had nearly 7.7 million gig workers, projected to increase to 23.5 million by 2030. These include delivery partners, cab drivers, online tutors, repair technicians, and several others. Despite their growing contribution to GDP and urban livelihoods, these workers largely operate outside the purview of existing labour protections.
Traditional labour laws in India were designed for industrial workers within fixed establishments, where employer control and subordination could be clearly established. However, gig work dismantles this paradigm. Workers operate as independent contractors, remunerated per task, while platforms assert that they merely act as intermediaries. This classification allows companies to circumvent statutory obligations such as provident fund, maternity benefits, or gratuity. Consequently, gig workers inhabit a legal grey zone—neither employees nor entrepreneurs— rendering them invisible to most welfare schemes.
The Code on Social Security, 2020 (hereinafter “the Code”) attempts to bridge this gap by formally recognising gig and platform workers and by mandating the formulation of welfare schemes. Yet, the Code stops short of conferring employee status, leaving fundamental rights like minimum wages and collective bargaining unresolved. This article delves deeply into this complex terrain to evaluate whether India’s labour reform adequately addresses the realities of digital work.
EVOLUTION OF THE GIG AND PLATFORM ECONOMY
The gig economy’s roots can be traced to the rise of digital marketplaces in the early 2000s, such as eBay and Craigslist, which introduced peer-to-peer commerce. Over time, platforms like Uber, Airbnb, and TaskRabbit expanded this model to services, creating algorithmically mediated employment.
In India, platforms such as Ola, Uber, Swiggy, and Zomato revolutionised urban mobility and food delivery, providing flexible earning opportunities to millions. The COVID-19 pandemic further accelerated this shift. As traditional businesses faced lockdowns, digital platforms became lifelines for essential services. However, this convenience came at a cost: gig workers, often hailed as “frontline heroes,” lacked medical insurance, paid leave, or compensation mechanisms.
A 2021 survey by the Indian Federation of App-Based Transport Workers (IFAT) revealed that 90% of delivery and cab drivers lacked any form of social security. The absence of a legal framework not only exposed these workers to economic vulnerabilities but also raised ethical concerns regarding algorithmic control, data privacy, and unilateral contract changes imposed by platforms.
Conceptual Framework: Understanding Gig and Platform Work
The International Labour Organization (ILO) defines gig work as “short-term, task-based work mediated by digital platforms where the relationship between worker and employer is ambiguous.”
Two key categories exist:
Gig Workers – Defined under Section 2(35) of the Code on Social Security, 2020:
“Gig worker means a person who performs work or participates in a work arrangement and earns from such activities outside of traditional employer-employee relationship.”
Individuals engaged in income-earning activities outside of a traditional employer–employee arrangement. The term gig worker refers to individuals who engage in income-earning activities outside traditional employer-employee relationships, often facilitated through digital platforms. Gig work is usually characterized by short-term, flexible jobs or “gigs,” such as food delivery, ride-hailing, freelancing, and personal services.
With the rise of platforms like Uber, Zomato, Swiggy, Ola, Dunzo, Urban Company, etc., the gig economy in India has grown exponentially, reshaping the contours of the labour market. However, this growth has also led to complex legal and policy debates regarding the rights, protections, and classification of gig workers.
Platform Workers – Workers who access employment opportunities through online platforms that connect providers and consumers of services.
Platform Worker Defined under Section 2(60) of the same Code:
“Platform worker means a person engaged in or undertaking platform work.”
Section 2(61), Code on Social Security, 2020: “Platform work means a work arrangement outside of a traditional employer–employee relationship in which organisations or individuals use an online platform to access other organisations or individuals to solve specific problems or to provide specific services in exchange for payment.”
While the distinction may appear semantic, it is significant for legal regulation. Gig workers may operate offline (e.g., construction freelancers), whereas platform workers rely on technological mediation (e.g., app-based delivery). Both, however, share the insecurity of temporary contracts and dependency on algorithmic assignments.
The challenge lies in reconciling this non-traditional work structure with established labour jurisprudence, which historically hinges on the control test or organisation test to determine employment relationships.
Legal Background: Pre-Code Scenario
Prior to 2020, India’s labour legislation revolved around the binary distinction between “employer” and “employee.” Acts such as the Industrial Disputes Act, 19473, the Employees’ State Insurance Act, 19484, and the Employees’ Provident Funds and Miscellaneous Provisions Act, 19525defined employment in terms of control, supervision, and permanence.
Gig workers, functioning as self-employed contractors, were thus excluded from most welfare provisions. Even the Unorganised Workers’ Social Security Act, 2008 did not explicitly include them, though they constituted a significant portion of the unorganised sector.
This regulatory gap persisted despite judicial recognition of broad social security obligations. The Supreme Court in People’s Union for Democratic Rights v. Union of India (1982 AIR 1473)6 emphasised that the right to life under Article 21 includes the right to livelihood and humane working conditions. Yet, without legislative backing, enforcement for gig workers remained elusive.
The Social Security Code, 2020: A Legislative Milestone
The Code on Social Security, 2020 amalgamates and rationalises nine central labour laws, including the Employees’ Compensation Act, 19237 and the Maternity Benefit Act, 19618. It marks the first statutory attempt to bring gig and platform workers into the social security net.
Recognition and Definitions
Section 2(35) of the Code defines a “gig worker” as a person who performs work or participates in a work arrangement and earns from such activities outside the traditional employer–employee relationship. Similarly, Section 2(61) defines a “platform worker” as a person engaged in work through an online platform that connects them with consumers.
This recognition is significant—it symbolically acknowledges gig workers as part of the nation’s productive labour force and lays the groundwork for targeted welfare schemes.
Provisions for Social Security Schemes
1.Section 109–114 (Chapter IX) empowers the central and state governments to frame schemes for gig and platform workers, including insurance, health, maternity, and old-age benefits.
2.Funding Mechanism: Contributions may be drawn from three sources—government grants, platform companies (aggregators), and voluntary worker contributions.
3.Aggregator Contribution (Section 114): Aggregators such as Swiggy, Uber, and Urban Company must contribute between 1–2% of annual turnover, capped at 5% of each worker’s remuneration, to the Social Security Fund.
4.National Database: The Code mandates the creation of a comprehensive digital registry of unorganised, gig, and platform workers for portability of benefits.
By institutionalising these measures, the Code partially bridges the welfare gap. Yet, it stops short of redefining the employment relationship, thereby maintaining gig work’s non-employee status.
Judicial and Policy Developments
Indian courts have begun to confront the legal ambiguities surrounding platform work.
In Ola Drivers Union v. State of Karnataka (2022)9, the High Court acknowledged the absence of statutory protection for platform drivers and urged the state to expedite welfare implementation under the Social Security Code. Similarly, in Indian Federation of App-Based Transport Workers v. Union of India (2021)10, the Supreme Court entertained a public-interest petition demanding social security for gig workers, directing the government to respond under Articles 14 and 21.
Judicial discourse increasingly recognises that digital labour, though unconventional, is integral to modern economies and thus merits constitutional protection.
Policy initiatives have also evolved. The NITI Aayog’s 2022 Report recommended universal social security coverage, contributory insurance schemes, and a national gig worker registry. Several states, including Rajasthan and Tamil Nadu, have proposed welfare boards for platform workers.
Comparative International Frameworks
United Kingdom
The landmark judgment in Uber BV v. Aslam [2021] UKSC 511 fundamentally altered the employment landscape. The UK Supreme Court held that Uber drivers are “workers,” not independent contractors, thereby entitled to minimum wage, paid leave, and pension benefits. The Court emphasised Uber’s control through pricing algorithms, route assignment, and performance monitoring as evidence of subordination.
European Union
The EU Directive on Platform Work (2022)12 introduces a presumption of employment for platform workers. It reverses the burden of proof—platforms must demonstrate that a worker is genuinely self-employed. This measure ensures access to collective bargaining and social protection.
United States
The U.S. approach is fragmented. California’s Assembly Bill 5 (2019) sought to classify gig workers as employees using the “ABC test,” but subsequent lobbying by tech companies led to Proposition 22 (2020), which exempted app-based drivers from full employment status. Litigation continues, reflecting the ongoing struggle between innovation and regulation.
Lessons for India
India’s model, while progressive in recognition, lacks enforceable rights. Unlike the UK and EU, the Code does not presume employment; instead, it treats gig work as sui generis. For meaningful protection, India must consider hybrid frameworks that balance flexibility with guaranteed welfare.
Socio-Economic Significance and Challenges
The gig economy contributes approximately 1.25% of India’s GDP, employing millions in urban and semi-urban areas. Yet, this growth is accompanied by income volatility, lack of bargaining power, and algorithmic exploitation.
Implementation Barriers
1.Delayed Enforcement: Despite its passage in 2020, the Code remains unimplemented pending subordinate legislation.
2.Data Deficiency: Absence of a unified database makes identification and benefit distribution difficult.
3.Awareness Deficit: Most gig workers are unaware of available schemes or procedures for registration.
4.Corporate Resistance: Aggregators often contest contribution obligations, citing financial stress.
5.Gender Disparity: Women constitute less than 20% of the gig workforce, facing unique safety and maternity challenges.
6.Technological Divide: Many workers lack digital literacy, hindering access to welfare portals.
The International Labour Organization (2023) warns that without state regulation, the gig economy risks institutionalising a “race to the bottom” in wages and working conditions.
Constitutional and Human Rights Dimensions
The Indian Constitution enshrines social and economic justice as guiding principles. Articles 38, 39, 41, and 43 obligate the State to ensure adequate means of livelihood and social security. Moreover, Article 21 guarantees the right to life and dignity.
In Bandhua Mukti Morcha v. Union of India (1984)13, the Supreme Court held that humane conditions of work and social welfare are essential components of Article 21. Extending these principles, gig workers—though digitally employed—deserve protection from economic exploitation and deprivation.
Furthermore, India’s international commitments under the Universal Declaration of Human Rights (Article 22) and ILO Convention 102 underscore its duty to provide social security for all workers, formal or informal.
Critical Evaluation of the Social Security Code, 2020
The Code represents a transformative legislative step but remains limited in scope and enforceability.
1.Symbolic Recognition Without Rights: While gig workers are recognised, the Code does not grant them employee rights such as collective bargaining or minimum wages.
2.Voluntary Schemes: Many welfare provisions are discretionary, leaving implementation to the will of governments and aggregators.
3.Fragmented Institutional Framework: Absence of a centralised regulatory authority leads to policy inconsistency across states.
4.Weak Enforcement Mechanisms: Without clear penalties for non-compliance, companies may evade contributions.
5.Digital Inequality: Reliance on online registration may exclude rural and semi-urban gig workers lacking internet access.
Hence, the Code serves more as a welfare declaration than a rights-based guarantee. 13 Bandhua Mukti Morcha v. Union of India (1984)
CONCLUSION
The expansion of globalization has fundamentally reshaped the structure and scope of international financial transactions, allowing money, goods, and services to circulate across national borders with unprecedented speed and efficiency. This study underscores that cross border financial dealings are not purely economic in nature but are deeply embedded within complex legal frameworks that span multiple jurisdictions, international conventions, and contractual relationships. A core observation derived from this research is that the legal implications of global finance transcend the conventional boundaries of contractual enforcement. They touch upon broader concerns such as financial stability, fiscal sovereignty, taxation, and compliance with anti-money laundering (AML) and counter-terrorism financing (CFT) obligations. National and international frameworks, including India’s Foreign Exchange Management Act (1999), the Basel III regulatory standards, and the OECD’s Base Erosion and Profit Shifting (BEPS) guidelines, collectively reflect the global attempt to maintain transparency, accountability, and systemic stability within international markets.
Equally vital is the role of dispute resolution in sustaining the integrity of cross-border finance. The modern trend clearly leans toward alternative dispute resolution mechanisms, particularly international arbitration and mediation, due to their efficiency and global enforceability. Instruments like the New York Convention (1958) and the Singapore Convention on Mediation (2019), together with the UNCITRAL Model Law on International Commercial Arbitration (1985, amended 2006), have established uniformity and predictability in resolving transnational disputes. Judicial precedents such as BALCO v Kaiser Aluminium and Dallah Real Estate v Pakistan further reinforce the importance of party autonomy, the doctrine of competence-competence, and the recognition of foreign arbitral awards. Nonetheless, the regulatory environment remains fragmented. Persistent challenges such as conflicts of laws, the execution of foreign judgments, and inconsistencies in the treatment of cross-border financial instruments continue to hinder complete harmonization. The rise of digital finance, cryptocurrencies, and blockchain technologies has further blurred jurisdictional boundaries, as countries adopt diverse approaches to regulation and enforcement. The contrast between the frameworks of the European Union, the United States, and India reveals the absence of a unified legal approach capable of addressing the rapid evolution of fintech ecosystems.
From a policy perspective, this research emphasizes the need for enhanced cooperation among international financial and regulatory bodies, such as the Financial Stability Board (FSB), the International Monetary Fund (IMF), and the World Bank. Strengthening preventive mechanisms through early mediation, standardized contractual terms, and pre-arbitration negotiations could substantially reduce cross-border legal disputes. Moreover, soft law instruments—notably the OECD Guidelines for Multinational Enterprises and the Basel Principles—play a crucial role in promoting ethical and transparent financial practices globally.
In summation, the future trajectory of cross-border financial regulation depends on greater harmonization, digital adaptability, and institutional consistency. Although international legal frameworks have evolved significantly, their efficacy ultimately rests on uniform enforcement and judicial cooperation. The delicate equilibrium between national sovereignty and global economic interdependence will continue to shape the legal contours of international finance.
For emerging economies such as India, aligning domestic policies with global standards while safeguarding local interests remains an essential yet challenging endeavor. Hence, as the study concludes, the realm of cross-border finance will increasingly operate at the confluence of law, technology, and economic governance, demanding continuous legal innovation and collaboration to foster a stable, transparent, and equitable international financial order.
RECOMMENDATION
1.Immediate Operationalisation: The central and state governments must expedite notification of rules and schemes under the Code.
2.Presumption of Employment: Introduce a rebuttable presumption that gig workers are employees unless proven otherwise, following the UK model.
3.Unified Welfare Board: Establish a National Gig and Platform Workers Welfare Authority to coordinate policy, registration, and dispute resolution.
4.Minimum Standards Charter: Guarantee minimum wages, working hours, and accident insurance irrespective of employment classification.
5.Tripartite Dialogue: Include representatives of workers, aggregators, and government in policy formulation.
6.Gender-Sensitive Measures: Provide maternity benefits, safety infrastructure, and skill training for women gig workers.
7.Technology-Enabled Transparency: Mandate algorithmic transparency and data rights for workers to prevent digital exploitation.
8.Fiscal Incentives: Offer tax benefits to aggregators complying with social security obligations.
9.Judicial Oversight: Empower labour courts or industrial tribunals to adjudicate disputes involving platform workers.
10.Awareness Campaigns: Promote literacy on social security rights through multilingual digital campaigns.
These steps would align India’s labour policy with constitutional directives and global best practices.
REFERENCE(S):
PRIMARY SOURCES
1.Foreign Exchange Management Act, 1999 (India).
2.Arbitration and Conciliation Act, 1996 (India).
3.Bharatiya Nagarik Suraksha Sanhita, 2023 (India).
4.UNCITRAL Model Law on International Commercial Arbitration, 1985 (amended 2006). 5.New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958.
6.Basel Committee on Banking Supervision: Basel III Framework, Bank for International Settlements, revised June 2024.
7.OECD Guidelines for Multinational Enterprises, 2023 update.
8.International Monetary Fund (IMF) Articles of Agreement, 2023.
9.European Union Regulation (EU) No 1215/2012 on Jurisdiction and Recognition of Judgments in Civil and Commercial Matters (Brussels Recast Regulation).
10.United Nations Convention on International Settlement Agreements Resulting from Mediation (Singapore Convention), 2019.
CASE LAWS
11.Dallah Real Estate and Tourism Holding Co v Ministry of Religious Affairs of the Government of Pakistan [2010] UKSC 46.
13.Bhatia International v Bulk Trading SA (2002) 4 SCC 105 (India).
14.BALCO v Kaiser Aluminium Technical Services Inc (2012) 9 SCC 552 (India). 14.Renusagar Power Co Ltd v General Electric Co (1994) Supp (1) SCC 644 (India).
15.Union of India v Vodafone International Holdings BV (2012) 6 SCC 613 (India).
16.Cruz City 1 Mauritius Holdings v Unitech Limited (2017) SCC OnLine Del 7810.
17. Eitzen Bulk A/S v Ashapura Minechem Ltd (2016) SCC OnLine Bom 10036.
18.Morgan Stanley & Co International plc v Skelton [2021] EWCA Civ 1421. 19.Republic of Argentina v BG Group plc [2014] USSC No 12-138.
20.Deutsche Bank AG v Comune di Savona [2018] EWCA Civ 1740.
BOOKS
21.Rosa Lastra, International Financial and Monetary Law (2nd edn, OUP 2019).
22.Andreas Lowenfeld, International Economic Law (2nd edn, OUP 2018).
23.Mads Andenas and Iris H-Y Chiu, The Foundations and Future of Financial Regulation (Routledge 2020).
24.Roy Goode, Commercial Law (5th edn, Penguin 2021).
25.Andrew Dickinson, The Rome II Regulation: The Law Applicable to Non-Contractual Obligations (OUP 2022).
26.Craig Forrest, Private International Law and International Commercial Arbitration (Springer 2023).
27.Benjamin Richardson, Socially Responsible Finance and Investing (Routledge 2024).
28.Mark Weston Janis, International Law (8th edn, Wolters Kluwer 2023).
29.Gerard McCormack, Secured Credit and the Harmonisation of Law: The Role of Secured Transactions Conventions (Edward Elgar 2022).
JOURNAL ARTICLES
30.Michael Waibel, ‘Sovereign Debt and International Law: The Legal and Institutional Framework’ (2023) 24 Journal of International Economic Law
31.Simon Gleeson, ‘Cross-Border Banking and the Law’ (2024) 39 Banking & Finance Law Review 87.
32.Fiona Beveridge, ‘International Financial Regulation after Basel III’ (2024) 21 Law and Financial Markets Review 134.
33.Rohan George, ‘India’s Approach to Enforcement of Foreign Arbitral Awards: A New Dawn?’ (2023) 45 Company Lawyer 210.
34.Harini Raghavan, ‘Crypto-assets, Cross-border Transactions, and Emerging Legal Challenges’ (2025) 12 Journal of FinTech Law 57.
35.David Collins, ‘Investor-State Dispute Settlement and Financial Regulation: Trends and Reform’ (2024) 35 ICSID Review 88.
36.Prateek Surana, ‘International Arbitration and Enforcement in India Post-2023’ (2024) Indian Journal of Arbitration Law 112.
ONLINE REPORTS & RECENT SOURCES
37.World Bank, Global Financial Stability Report (April2025) https://www.worldbank.org/en/publication/gfdr.
38.International Monetary Fund, IMF Annual Report 2024–25: Restoring Confidence in Global Financial Systems https://www.imf.org.
39.OECD, International Tax Reform – Global Minimum Tax Implementation Handbook (2024) https://www.oecd.org/tax.
40.Financial Stability Board, Cross-Border Payment Systems and Data Governance Report (February 2025) https://www.fsb.org.
41.Reserve Bank of India, Annual Report 2024–25 https://www.rbi.org.in.
42.United Nations Conference on Trade and Development (UNCTAD), World Investment Report 2025: Financing Sustainable Development https://unctad.org.
43.Bank for International Settlements, Basel Committee Newsletter No. 54: Developments in Cross-Border Supervisory Cooperation (June 2025).
44.Organisation for Economic Co-operation and Development (OECD), Global Forum on Transparency and Exchange of Information for Tax Purposes: 2025 Update.
1 Social Security Code, 2020
2 NITI Aayog Report (2022)
3Industrial Disputes Act, 1947
4 Employees’ State Insurance Act, 1948
5 Employees’ Provident Funds and Miscellaneous Provisions Act, 1952
6 People’s Union for Democratic Rights v. Union of India (1982 AIR 1473)
7 Employees’ Compensation Act, 1923
8 Maternity Benefit Act, 1961
9 Ola Drivers Union v. State of Karnataka (2022)
10 Indian Federation of App-Based Transport Workers v. Union of India (2021)
11 Uber BV v. Aslam [2021] UKSC 5
12 EU Directive on Platform Work (2022)
