Social Security Boards For Unorganized And Gig Workers
Source: Indian Express
GS II: Welfare schemes for vulnerable sections of the population by the Centre and States and the performance of these schemes, mechanisms, laws, institutions and bodies constituted for the protection and betterment of these vulnerable sections; GS III: Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment
Overview
- The Ministry of Labour and Employment has constituted separate social security boards for unorganized workers and gig and platform workers.
- The Code on Social Security, 2020, provides a framework for extending social protection to these workers.
- The boards will recommend and monitor welfare schemes covering health, insurance, maternity benefits and old-age protection, with contributions from digital aggregators.
- The initiative aims to strengthen labour welfare and promote inclusive social security, though effective implementation, funding and worker registration remain key challenges.
Why in the News?
The Ministry of Labour and Employment has constituted separate social security boards for unorganized workers and gig and platform workers to strengthen their welfare and social protection.
News in Brief
- The government has constituted two social security boards to recommend, monitor and review welfare measures for unorganized and gig workers.
- The Code on Social Security, 2020, legally recognized gig and platform workers for the first time and provided for a social security fund.
- The boards will recommend schemes covering life and disability protection, accident insurance, healthcare, maternity benefits and old-age security.
- Online aggregators such as Amazon, Flipkart, Swiggy and Zomato will contribute 1–2% of their annual turnover towards the social security fund, subject to a ceiling of 5% of the amount payable to workers.
Social Security for Unorganized and Gig Workers
- A large section of India’s workforce is employed in the unorganized sector, where workers often lack formal employment contracts, job security and access to social protection.
- The expansion of digital platforms has also increased gig and platform-based employment, creating new challenges relating to income security, insurance and welfare benefits.
- To address these concerns, the government introduced four Labour Codes, including the Code on Social Security, 2020.
- The Code consolidated existing social security laws and extended its framework to organized, unorganized, gig and platform workers.
- It provided for the registration of unorganized workers and the creation of a Social Security Fund to support their welfare.
National Social Security Boards
The Code provides for social security boards to advice the Central Government on framing and monitoring welfare schemes for different categories of workers.
National Social Security Board for Unorganized Workers
- The government has notified a 40-member board comprising representatives of employees, employers and government institutions.
- Its membership includes representatives from trade unions, employer organizations, government departments and Parliament.
- The board is chaired by the Union Labour Minister, while the Labour Secretary serves as its Vice-Chairperson.
- Organizations such as the Bharatiya Mazdoor Sangh (BMS) and Laghu Udyog Bharati are represented on the board.
National Social Security Board for Gig and platform workers
- A separate 22-member board has been constituted to address the welfare requirements of gig and platform workers.
- Its composition includes representatives of aggregators and quick-commerce companies such as Zomato’s parent company Eternal, Zepto, Swiggy and Urban Company.
- Workers are represented by organizations such as:
- Bharatiya Mazdoor Sangh (BMS).
- Indian Federation of App-Based Transport Workers.
- National Front of Indian Trade Unions.
- The board also includes representatives from government departments and other relevant institutions.
What will the Boards do?
Under the Code on Social Security, the boards will perform the following functions;
Recommend welfare schemes
- Recommend suitable social security schemes to the Central Government for different categories for unorganized, gig and platform workers.
- The schemes will address the specific needs of workers who lack conventional employment benefits.
Monitor implementation
- Monitor the implementation of social welfare schemes for unorganized and gig workers.
- Review the functioning of welfare programmes and identify gaps in their implementation.
Review social security funds
- Examine expenditure from the Social Security Fund and review its accounts.
- Ensure that the funds are utilized for the intended welfare purposes.
Advise the Central Government
- Advice the government on matters arising from the admiration of the Code on Social Security.
- Review record-keeping related to gig workers’ welfare schemes at the state level.
Frequency of meetings
- The National Social Security Board will meet at least three times a year to review issues and recommend appropriate measures.
Social Security Benefits for Gig and Platform Workers
- The Code envisages a comprehensive social security framework for gig and platform workers.
- The proposed welfare measures include;
- Life and disability cover: Financial protection against death and disability.
- Accident insurance: Protection against work-related accidents.
- Health benefits: Access to healthcare and medical protection.
- Maternity benefits: Social protection for women workers during maternity.
- Old-age protection: Financial security and support after retirement.
- Crèche facilities: Childcare support for workers with young children.
Social Security Fund- Contribution by Aggregators
- The Code provides for the creation of a Social Security Fund for gig and platform workers.
- The fund may receive contributions from the Central and State Governments, corporate social responsibility (CSR) contributions and penalties collected through compounding, among other sources.
- Online aggregators such as Amazon, Flipkart, Swiggy and Zomato will contribute 1-2% of their annual turnover towards the fund.
- However, their contribution cannot exceed 5% of the amount payable by them to gig and platform workers.
- This provision seeks to make digital platforms share responsibility for the social protection of workers who depend on them for their livelihoods.
Changes in Employees’ Provident Fund (EPF) Coverage
- The Code on Social Security has also expanded the applicability of the Employees’ Provident Fund Organisation (EPFO).
- EPF provisions will now apply to all establishments employing 20 or more employees, irrespective of the nature of the industry.
- Earlier, the EPF Act was applicable mainly to establishments listed under Schedule I of the Act, particularly those in the manufacturing sector.
- The new provision removes this industry-based restriction and broadens the coverage of formal social security.
Significance
- The Constitution of these boards can expand social security coverage among vulnerable workers and provide formal recognition to gig and platform workers.
- Requiring aggregators to contribute towards welfare funds promotes shared responsibility between digital platforms and the government.
- It can also improve access to healthcare, insurance, maternity, and old-age benefits.
- Further, wider EPF coverage can encourage the formalization of employment and strengthen labor welfare.
Challenges
- Despite these measures, effective implementation remains a concern.
- Identifying and registering migrant, informal and platform-based workers is challenging.
- Inadequate funding may limit the delivery of meaningful welfare benefits, while coordination gaps between the Centre, States and digital platforms can affect implementation.
- Limited awareness and difficulties in accessing welfare schemes may also prevent workers from fully benefiting from social security provisions.
Way Forward and Conclusion
The government should ensure effective implementation of the boards’ recommendations through time-bound welfare programmes, simplified worker registration and transparent monitoring of social security funds. Stronger Centre-State coordination and better awareness can improve workers’ access to welfare benefits.
Ultimately, India needs to move towards an inclusive social security framework that protects workers irrespective of their employment arrangements. This is essential to ensure decent working conditions, livelihood security and inclusive growth in the changing labour market.
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