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A Case for Worker-Centric Platform Economy in India

Article in SSRN Electronic Journal · October 2021

DOI: 10.2139/ssrn.3963556

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 A Case for Worker-Centric Platform Economy in India 1
India In Transition, Center for the Advanced Study of India, University of Pennsylvania

Francis Kuriakose & Deepa Kylasam Iyer

October 2021

Part 1

The COVID-19 crisis brought the woes of Indian platform workers into sharp focus, as the lack
of labor rights—regulated work hours, minimum wages, data rights, and social protection—
exacerbated the precarity and insecurity of their work. As the lockdown was implemented in
major cities, digital delivery platforms became all-purpose pick-and-drop services in response to
surging demand. From our fieldwork in southern India, we observed that platform workers often
had to pay out-of-pocket for safety equipment such as face masks and hand sanitizer, in addition
to fuel and vehicular maintenance expenses. Sometimes they substituted makeshift masks made
of cloth in place of medically certified face masks or head gear and wore no gloves. In the
absence of specific policies and guidelines, some Indian platforms designed perverse incentive
mechanisms such as the promise of one-time insurance payments against health risks and
continued to extract longer work hours from their employees. For many, opting out of such work
was not conceivable due to their stressful financial conditions.

Against this turbulent backdrop, the vision of India’s new industrial policy discussion paper to
utilize digital expansion to drive employment generation can only be analyzed with cautious
optimism. The growing concern is that the institutional architecture of regulating digital
platforms is not yet in place. In this two-part series, we discuss problems specific to digital
platforms in India and the type of regulatory framework required to ensure labor rights. In the
first part, we flag three main structural problems Indian platform workers face. The second part
explores the role of institutions in creating a regulatory framework for digital platforms so that
an expanded set of worker rights, including data rights, are available to platform workers.

Understanding Structural Conditions

As Nick Srnicek defines in his book, Platform Capitalism, digital platforms are many-sided
market places that bring service providers, consumers, and workers together with a common set
of tools to match supply and demand in an efficient manner. The Indian government defined
platform workers and aggregators for the first time under the new Code on Social Security Act

1
The article was published in two parts – part 1 on October 25, 2021 and the part 2 on November 8, 2021. To access
the articles online, visit: https://casi.sas.upenn.edu/iit
2020. In the Indian context, the structural conditions of the economy exacerbate the problems
inherent to platforms. As the Economic Survey 2018-19 indicates, an average Indian firm
employs only 40 percent more workers, even after four decades of existence, than it did when it
was less than five years old. The second feature is the high level of precarity and insecurity of
work that is related to informality. In the country brief Inclusive Future of Work (2019), the
International Labour Organization (ILO) estimates that despite having a high weekly work week
of 50 hours, 77 percent of Indian workers are vulnerable. Furthermore, about 92 percent of
workers are in the informal sector where there is no written contract or social security.

In this context, the Government of India’s Ministry of Electronics and Information Technology
identified investment in digital economy as a source of economic growth and secure employment
capable of generating a revenue of $1 trillion and 65 million jobs by 2025 in the report “India’s
Trillion-Dollar Economy.” According to a background note on the national conference on gig
economy compiled by the Associated Chambers of Commerce and Industry of India, platforms
form an important part of this equation with over 15 million freelance service providers in India.
Like their counterparts elsewhere, Indian platform workers confront the issues of algorithmic
control of work, absence of collective bargaining, minimum wages, regulated working hours, and
social security. From a regulatory viewpoint, Indian platform workers face three main structural
issues.

Problems of Platform Workers

The first issue is that of regulation of platform investment. In India, digital platforms are not
regulated under well-defined and uniform guidelines. In order to protect offline retail stores that
are the source of local employment, India treats online and offline medium as well as domestic
and foreign entities differently. This differential treatment has hampered the vertical integration
of digital platforms affecting storage and last-mile delivery of goods and services. It has also
delayed connecting small traders with online markets. The right type of regulation, with respect
to investment related to back-end infrastructure, employment generation, local suppliers, and
data protection, can foster the growth of the digital economy by creating a level-playing field
with accountability. The draft national e-commerce policy 2019 is a step in the right direction,
but India needs to think imaginatively to include international players while protecting domestic
entrepreneurs and local interests.

The second issue is that of skilling workers. In the ILO report “World Employment and Social
Outlook 2021,” India is identified as the largest supplier of platform workers with 20 percent of
the global share. Among outsourced work from developed economies, Indian workers were
concentrated in software and multimedia sectors involving clerical jobs such as data entry and
general professional services, which are low-skilled and prone to automation. In the non-
outsourced type of work, most platform workers were engaged in taxi and delivery services.
Most importantly, compared to other countries, India’s labor share of women was uniformly low
in all occupational categories including online web-based platform work and female-dominated
sectors such as writing and translation. Clearly, there is an urgent need for reskilling and
upskilling workers, as well as targeting specific groups of workers, such as women, if digital
platforms have to continue as sources of equitable, well-paying, and secure jobs. The role of the
private sector in skilling, reskilling, and upskilling of workers, along with career counseling and
mentoring, is inevitable if India is to make use of the high-end of digital platforms.

The third issue is that of social protection. India has recently reduced the existing 44 labor laws
into four labor codes. Among the labor codes, the Code on Social Security Act 2020 identifies
platform work as a category of employment and calls for platform companies to contribute 1-2
percent of their annual turnover or 5 percent of wages (whichever is lower) to the workers’ social
security fund set up by the government. However, as Lakshmee Sharma notes in her article, “A
Secure Future for Platform Workers,” the bill advocates social protection to be divided between
the platform firms and the national government without clarity on the method of delivery.
Additionally, platform firms provide upfront credit for prospective workers to invest in assets
related to platform work, which then becomes a debt trap. Regulating platforms must therefore
look into social protection and credit access as part of the same continuum.

At the juncture of structural transformation that is underway in the Indian economy, the larger
question regarding platforms is what kind of growth and what type of jobs are we looking at?
Can platforms grow as a steady source of good quality employment for the urban poor while
serving the burgeoning middle and upper classes? Answering this question affirmatively
engenders regulating investment, skilling workers by involving the private sector, and defending
labor rights with respect to credit access and social protection.
***

Part 2

As the first wave of the coronavirus pandemic resulted in a near-complete lockdown of the
Indian economy, digital platforms were in turmoil amidst raging protests from their workers.
Delivery service platforms such as Swiggy faced workers’ agitation against repeated paycuts and
scaling down of their monthly incentives at a time when they were forced to deliver in
containment zones, risking personal health and braving violence from the police forces on the
ground. Drivers of ride-hailing apps Uber and Ola demanded that the additional commission
their employers charged be scaled down in times of plummeting demand. Small sellers and
vendors in delivery platforms such as Amazon and Flipkart protested against their anti-
competitive practices that gave preferential treatment to big brands and wholesale sellers. The
main challenge protesting workers faced was worker account deactivation by the platform
aggregators in the absence of clear worker rights and a data protection regime in India. Here, we
examine this regulatory failure and the role of institutions in creating an institutional framework
that ensures workplace rights—including data rights—for platform workers.

Demands of Workers’ Collective

The pandemic created the inevitable window of opportunity for Indian platform workers to
organize and demand labor rights like never before. Like their counterparts elsewhere, Indian
platform workers used social media, (e.g., WhatsApp groups), as a shared space to discuss
workers’ issues that resulted in demonstrations, protests, and strikes across cities. However, in
the event of platforms (e.g. Swiggy suspending striking workers), workers’ collectives emerged
as the organizational vehicle for bargaining labor rights. The Indian Federation of App-based
Transport Workers (IFAT) organized drivers of ride-hailing apps and delivery workers. Through
four separate surveys of platform workers in 50 Indian cities during the lockdown, IFAT argued
that 90 percent of workers did not receive any food assistance and close to 85 percent did not
have any social protection at a time when they had no work and more than half had debt related
to vehicle loans. At the time, IFAT was engaged in relief work among unemployed platform
workers and supporting women drivers.

All India Gig Workers’ Union (AIGWU), an unregistered umbrella organization of platform and
gig workers, also swung into action. They used the spontaneous protests of platform workers to
collectivize their demands, coordinate with state-level labor unions, raise awareness, and form
strategic allies among other workers’ collectives. Furthermore, the AIGWU coordination
committee submitted a formal memorandum to the Ministry of Labor and Employment
demanding universal social protection floor that clearly laid out the responsibility of employers
toward social security contribution. They also tabled employee representation and workers’ data
rights on the agenda.

Data Rights of Platform Workers

Consequently, the challenges and vulnerabilities faced by the platform and gig workers was
briefly acknowledged in the Union Budget 2021. Platform and gig workers were entitled to
minimum wage, which was to be provided by the Employee State Insurance Corporation.
Second, a portal to collect information about the gig and informal workers was to be launched to
facilitate data-driven policy-making toward a number of social security schemes such as health,
housing, insurance, credit access, and food subsidy. But this limited policy focus failed to
facilitate a transition of worker rights discourse that encompassed data rights for platform
workers.

In order to enable an integrated approach to platform worker rights, new forms of labor
management and control that platforms engage in has to be understood. In our research article
“Digital Workers, Urban Vectors, and New Economies,” we discuss the ways in which platforms
capture value generated by their workers by employing algorithmic control of work using
methods such as micro-logging of tasks and hyper-individualization of risks by altering the
property relations of work. Furthermore, through continuous surveillance of workers, additional
value is captured from workers beyond the strict limits of their work without their knowledge
and consent. In this scenario, traditional methods of worker collectivization and bargaining of
rights alone are not adequate to challenge these practices as the workplace is controlled by self-
generating algorithms and worker performance and rewards are calculated by non-transparent
methods of aggregating rating points. In this context, the role of the state in conceptualizing and
implementing the limits of data use by employers assume primary importance.

As the example of the European Union’s General Data Protection Regulation suggests,
entrenched labor laws and data rights regimes encouraged platform workers’ unions to lobby for
minimum wage legislation and challenge data mining. In the United Kingdom, Uber drivers used
subject access request provision in digital platforms to pool worker data and successfully
challenge unjust worker account deactivation in the courts. The role of the judiciary in enabling
worker rights and collective justice is immense in the context of India as well. The issue of
ownership of data rights also applies to worker data collected by the state through data portals as
is envisaged in the Indian case. Rather than centrally pooling worker data, a federated
architecture that enables democratic and decentralized management of such data should be
explored with wide participation from workers’ representatives and civil society organizations.
At the public consultation ensuing the Draft Code on Social Security (Central) Rules, 2020
workers’ collectives demanded that the state should clearly delineate the purpose for which
worker data is collected by the platform aggregators with explicit right to access copies of such
data, enable litigation of claims in courts of law, and ensure audit by an independent authority.

Integrated Approach to Worker Rights

Beyond using existing institutions to claim rights, there needs to be widespread public discussion
on alternative forms of ownership of digital platforms such as worker-owned cooperatives and
platforms offering public utilities. Collectively-owned platforms face challenges in procuring the
computational architecture as well as the associated investment, administrative, and financial
support. However, there are examples of small-scale ventures in which local governments and
open-source institutions have acted as the intermediary organizations enabling worker
cooperative platforms to sustain performance. For example, Die Linke in Germany offered a
framework for free and open software that enabled data sharing, re-use, collaboration, and
cooperation for maintaining cooperative platforms. An investment regime for such platforms can
be enabled by the state through active programs.

In all these policy opportunities to make platforms more worker-centric, the central role is that of
a regulatory environment with clearly laid out principles of rights and justice, as well as
 institutional coordination. The active negotiation of labor rights between workers’ unions and
civil society organizations, on the one hand, with the state and judiciary on the other, remain
paramount to ensure that platform aggregators are regulated. India, with its rich history of
indigenous experimentation, worker cooperatives, and trade union movement, has the
opportunity to use an integrated approach to set out its own path of sustainable and just
possibilities for workers in the precarious world of platform work.

***

Additional reading
Dunn, M. (2020). Making gigs work: digital platforms, job quality and worker motivations. New
Technology, Work and Employment, 35(2), 232-249.
Jonker-Hoffrén, P., & Jansen, G. (2021). The politics of platform work: representation in the age
of digital labour. In Platform Economy Puzzles. Edward Elgar Publishing.
Joyce, S., Neumann, D., Trappmann, V., & Umney, C. (2020). A global struggle: worker protest
in the platform economy. ETUI Research Paper-Policy Brief, 2.
Kasliwal, R. (2020). Gender and the Gig Economy: A Qualitative Study of Gig Platforms for
Women Workers. Observer Research Foundatio, ORF Issue Brief, (359).
Kuriakose, F., & Iyer, D. K. (2020). Job Polarisation in India: Structural Causes and Policy
Implications. The Indian Journal of Labour Economics, 63(2), 247-266.
Kuriakose, F. & Iyer, D.K. (2021). Digital Workers, Urban Vectors, and New Economies:
Examining Labor Response, Resistance, and Reorganization under Platform Capitalism. The
South Atlantic Quarterly, 120(4).

Rogers, B. (2016). Employment rights in the platform economy: Getting back to basics. Harvard
Law & Policy Review, 10, 479.
Selvi S, K., Maheswari K, U., & Kuriakose, F. (2021a). Re-Imagining Labour Rights in the Online
Gig Economy after COVID-19. SSRN. https://dx.doi.org/10.2139/ssrn.3921071
Selvi S, K., Maheswari K, U., & Kuriakose, F. (2021b). From granular to collective resistance:
Rethinking workers’ protests in digital cultures. SSRN.
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3963547
Van Doorn, N., & Badger, A. (2020). Platform capitalism’s hidden abode: producing data assets
in the gig economy. Antipode, 52(5), 1475-1495.

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