Draft gig worker bill: Karnataka likely to impose per transaction fee for welfare fund

Representatives from Ola, Uber, Swiggy, Zomato, Flipkart, Amazon, Porter, Rapido, Urban Company and others participated.

The Karnataka government conducted a stakeholder meeting with app-based aggregators and union representatives on July 1, ahead of introducing the Karnataka Platform-based Gig Workers (Social Security and Welfare) draft bill, 2024, in the  legislature.

The draft states that under the 'Platform-Based Gig Workers Welfare Fee,' a percentage of the  transaction value, or the aggregator's annual turnover in Karnataka, will be deposited by the aggregator in the welfare fund.

“It’s most likely we will go with a per transaction fee/cess instead of a fee based on the annual turnover of the aggregator. We have given stakeholders 10 days to come up with their suggestions. We will decide on the transaction fee after considering feedback from aggregators and unions. We also have to look at the data, because aggregators handle millions of transactions,” state Labour Minister Santosh Lad told Moneycontrol.

Also read: Karnataka draft bill: Aggregators cannot terminate gig workers without 14-day notice

Lad said the government had conducted more than 18 stakeholder meetings so far to understand how this fee should be collected. "We've been working closely with online platforms like Flipkart, Amazon, Swiggy, and Zomato. We've asked stakeholders for their opinions, because different platforms operate differently. For example, Flipkart operates differently from Ola.

"Our department has worked on this (draft bill), and the stakeholders have given their inputs. We are open to new ideas and will have a grievance cell that includes aggregators. The government is committed to looking into any necessary changes," Lad explained.

He said the bill is almost finalised. "This will be an improved version compared to what the Rajasthan government has introduced. We believe the  bill that will be tabled in the upcoming assembly session will help gig workers," added Lad.

The draft bill proposes the establishment of a welfare board and a fund for platform-based gig workers, among other things. Aggregators include those providing services like ride-sharing, food and grocery delivery, logistics, e-marketplaces, professional services, healthcare, travel and hospitality, and content and media services.

Also, read: Karnataka to make registration must for aggregators to hire gig workers, law in the works

Additional Labour Commissioner (Industrial Relations) Manjunath Gangadhara told Moneycontrol: "The stakeholder meeting was to understand how the cess/charge can be collected. So far, we've conducted 18 such meetings. Most stakeholders agree on making it a percentage of the transaction value instead of the annual turnover. The draft bill is now in the public domain, and we have sought suggestions and objections from all stakeholders. We will take a final decision based on the feedback."

"The idea is not to regulate any business but ensure that the interests of gig workers are protected," he added.

Tanveer Pasha, President, Ola Uber Driver's and Owner's Association, welcomed the decision. "We have suggested to the state government that they should collect the cess as a percentage of the  transaction value instead of a flat fee. Crores of rupees can be collected as cess for the welfare fund, which will help gig workers.''

Shaik Salauddin, National General Secretary, Indian Federation of App-based Transport Workers, a trade union, said, "The state government should emulate the Maharashtra government's model for mathadi (headload) workers, which safeguards vulnerable workers. This should be emulated for the protection of gig workers."