Karnataka eyes gig fund rollout by August end; labour dept engages platforms to fix fee

Time of India

14-05-2025

The Karnataka Platform-based Gig Workers (Social Security and Welfare) Bill 2024 has been sent by the government to Raj Bhavan with a request to issue an Ordinance. The rules will suggest differential rates of fee for services, such as ride hailing, food delivery and online retail.
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The state government hopes to operationalise the gig workers' welfare fund in August as it engages app-based service providers in conversation to determine the percentage of fee the platforms must pay.The government has sent the Karnataka Platform-based Gig Workers (Social Security and Welfare) Bill 2024 to Raj Bhavan with a request to issue an Ordinance. 'We hope to implement the law by the end of August,' labour minister Santosh Lad told ET. His department is currently engaged in stakeholder consultations ahead of the framing of draft rules under the proposed law.The rules will suggest differential rates of fee for services, such as ride hailing, food delivery and online retail. Final rules will follow the government studies and stakeholder feedback. The government's current stance is that the rate must be proportionate to the size of net earnings. 'The welfare fee will not be based on the turnover, but on the service (delivery) charges,' Lad explained.The minister said about 20 rounds of meetings have been held so far with the parties being on the same page on gig workers' welfare.The fee payable by platforms to the fund would range from 1% to 5% on the commission paid to gig and platform workers. The Code on Social Security caps the fee at 5% of the commission.The labour department is also examining the likely impact of the proposed fee on customers, Additional Labour Commissioner G Manjunath said. Bengaluru is estimated to have about 2.75 lakh gig workers engaged in a range of services including ride-hailing, ecommerce and food delivery.The government has opted for the Ordinance route after AICC leader Rahul Gandhi cleared the broad contours of the policy last month. Karnataka has touted its proposed law as a rights-based one, aiming to protect the rights of the gig and platform workers.Karnataka came up with the Bill last year, after Rajasthan passed a law in July 2023, becoming the first state to introduce a law for platform workers. The state, however, is yet to frame rules.The minister said Karnataka will emerge as the first state to introduce welfare programmes for gig workers once it implements the law. 'We are the first state to have such a welfare fund for gig workers. The proposed law also ensures there are no arbitrary firings of workers by platforms.'The subject gained momentum after Gandhi discussed it with chief minister Siddaramaiah in Delhi, last month. The government had soft-pedalled on the idea after sections of ecommerce, ride-hailing and delivery platforms resisted the move, last year.