Karnataka to impose slab-based cess fee on aggregators

Speaking on the need for the ordinance, Karnataka Labour Minister Santosh Lad said, “Gig workers rush through traffic to deliver goods to customers on time. Whenever I see them, I think about the stress they endure, the risk of accidents in their haste, and the potential health impacts from inhaling vehicle fumes in congested traffic. I had always thought that… we should create a scheme to provide them with social and life security.”

Dr Manjunath, Additional Labour Commissioner, Karnataka, told The Indian Express, “We are consulting all the platforms and considering their inputs. The draft rules for setting the cess percentage will be finalised by Monday. We will be inviting public and stakeholder feedback before formalising the rule.”

The government is studying the financial modalities the aggregators have with gig workers in services like ride sharing, food and grocery delivery, logistics, e-marketplace for wholesale/retail sale of goods and services, healthcare, travel and hospitality, and content and media services.

Meanwhile, industry body Internet and Mobile Association of India (IAMAI) will also hold a key meeting with its members, including the leading aggregator platforms, over Karnataka’s gig workers ordinance on Monday.

During last year’s consultations on the draft bill, industry voiced concerns over a uniform fee structure, citing its unsuitability for varied platform business models. The proposed slab-based approach appears to address these concerns by tailoring the welfare fee to different platform types.

For instance, SaaS (Software-as-a-Service) platforms like Namma Yatri that operate on subscription fees rather than transaction commissions could be subject to lower welfare fee rates of 1-2 per cent. In contrast, commission-based aggregators such as Swiggy, Zomato, Zepto, Ola, Uber, Amazon, and Flipkart may face higher fees, potentially scaling up to 5 per cent, depending on their revenue models and transaction volumes.