Karnataka Cabinet clears gig workers welfare Bill, proposes cess on platforms

Earlier this month, a decision to establish the board was taken during a meeting in which the Leader of Opposition in Lok Sabha Rahul Gandhi, CM Siddaramaiah and Lad were present.

Lad said, “The board’s key responsibilities include ensuring the registration of gig workers, verifying registration of aggregators or platforms operating in the state, certifying proper collection of welfare cess, and overseeing the implementation of general and specific social security schemes. The board will also ensure that benefits from state government schemes reach gig workers effectively, monitoring delivery of social security programmes for platform-based workers.”

The Bill aims to allow workers to file grievances through an Internal Dispute Resolution Committee or a web-portal with a 14-day resolution timeline.

The Bill includes a provision under which workers would be allowed to refuse tasks and platforms have to notify workers of contract changes 14 days in advance.

According to the Bill, violations will attract penalties of Rs 5,000 for first offence and Rs 1 lakh for subsequent ones, with additional penalties for non-payment of welfare fees or other non-compliance.

Following the announcement, industry bodies like NASSCOM and Internet and Mobile Association of India (IAMAI) have raised concerns about the potential burden on e-commerce firms, especially startups already grappling with thin margins.

They feared that companies like Amazon and Flipkart, which have significant operations in Karnataka, may face increased operational costs, though the state’s pledge to cover additional funding could ease some pressure.

Industry bodies argued that the Bill, if enacted, could lead to higher costs, reduced operational flexibility, and service cutbacks. They also feared that consumers might face price hikes, fewer service options, and reduced discounts offered by platforms.