The Crossbill News Desk
In a move aimed at safeguarding the interests of platform-based gig workers, Karnataka Governor Thaawarchand Gehlot on Tuesday (May 27) gave his assent to the Karnataka Platform Based Gig Workers (Social Security and Welfare) Ordinance, 2025.
The ordinance, passed by Siddaramaiah led Congress government of the state, marks a pioneering step in regulating digital labour by bringing aggregators such as Swiggy, Zomato, Amazon, Ola, Uber, and others under a statutory framework to ensure social security and fair treatment for gig workers across the state.
Under the ordinance, all aggregator platforms are required to pay a gig workers' welfare fee ranging between 1% and 5% of the payout made to workers per transaction.
The exact rates for different categories of platforms will be notified by the state government within six months. The fee, to be collected by the platforms, must be deposited quarterly into the newly established Karnataka Gig Workers Social Security and Welfare Fund. The mode of collection will also be prescribed by the government.
To ensure accountability, the ordinance mandates a 12% simple interest penalty per annum on delayed payments. Repeated violations could attract fines up to Rs 5,000 for the first offence and Rs 1 lakh for subsequent breaches.
The fund will support an array of social security benefits, including financial assistance during periods of unemployment, illness, maternity, and work-related injuries. The ordinance also ensures that no more than 5% of the fund may be spent on administrative costs, reserving the majority for worker welfare.
All payouts and corresponding deductions must be recorded in a state-monitored Payment and Welfare Fee Verification System, which will be overseen by the soon-to-be-established Karnataka Platform Based Gig Workers Welfare Board.
Aggregators are further obligated to make payments to gig workers in regular cycles—daily, weekly, bi-weekly, or monthly—as per agreed contracts.
The ordinance introduces strong protections against arbitrary termination. Companies are now required to give workers a written explanation and a 14-day notice before termination, except in cases involving bodily harm, where immediate suspension is allowed but must be followed by an appeals process.
Moreover, platforms must register with the welfare board within 45 days of the ordinance coming into effect. Contracts offered to gig workers must be transparent, fair, and must include provisions allowing workers the right to refuse tasks without penalty.
The ordinance also establishes the Karnataka Platform Based Gig Workers Welfare Board, which will be headquartered in Bengaluru. This board will be responsible for registering gig workers and platforms, monitoring welfare fee compliance, implementing social security programs, and proposing schemes tailored to vulnerable groups such as women and persons with disabilities. The board will be chaired by the state’s labour minister and will include senior officials from the labour, IT, and commercial taxes departments as ex-officio members. A chief executive officer appointed by the government will handle day-to-day administration and serve as the ex-officio member secretary.
The board will also comprise four representatives each from gig worker groups and aggregator platforms, along with two civil society members with experience in the gig economy. A technical expert in data and IT systems may also be brought on as a special invitee when necessary.
With this ordinance, Karnataka becomes the first Indian state to roll out a structured legal framework aimed at extending rights and social protections to the gig workforce that powers India’s growing digital economy.
The ordinance, passed by Siddaramaiah led Congress government of the state, marks a pioneering step in regulating digital labour by bringing aggregators such as Swiggy, Zomato, Amazon, Ola, Uber, and others under a statutory framework to ensure social security and fair treatment for gig workers across the state.
Under the ordinance, all aggregator platforms are required to pay a gig workers' welfare fee ranging between 1% and 5% of the payout made to workers per transaction.
The exact rates for different categories of platforms will be notified by the state government within six months. The fee, to be collected by the platforms, must be deposited quarterly into the newly established Karnataka Gig Workers Social Security and Welfare Fund. The mode of collection will also be prescribed by the government.
To ensure accountability, the ordinance mandates a 12% simple interest penalty per annum on delayed payments. Repeated violations could attract fines up to Rs 5,000 for the first offence and Rs 1 lakh for subsequent breaches.
The fund will support an array of social security benefits, including financial assistance during periods of unemployment, illness, maternity, and work-related injuries. The ordinance also ensures that no more than 5% of the fund may be spent on administrative costs, reserving the majority for worker welfare.
All payouts and corresponding deductions must be recorded in a state-monitored Payment and Welfare Fee Verification System, which will be overseen by the soon-to-be-established Karnataka Platform Based Gig Workers Welfare Board.
Aggregators are further obligated to make payments to gig workers in regular cycles—daily, weekly, bi-weekly, or monthly—as per agreed contracts.
The ordinance introduces strong protections against arbitrary termination. Companies are now required to give workers a written explanation and a 14-day notice before termination, except in cases involving bodily harm, where immediate suspension is allowed but must be followed by an appeals process.
Moreover, platforms must register with the welfare board within 45 days of the ordinance coming into effect. Contracts offered to gig workers must be transparent, fair, and must include provisions allowing workers the right to refuse tasks without penalty.
The ordinance also establishes the Karnataka Platform Based Gig Workers Welfare Board, which will be headquartered in Bengaluru. This board will be responsible for registering gig workers and platforms, monitoring welfare fee compliance, implementing social security programs, and proposing schemes tailored to vulnerable groups such as women and persons with disabilities. The board will be chaired by the state’s labour minister and will include senior officials from the labour, IT, and commercial taxes departments as ex-officio members. A chief executive officer appointed by the government will handle day-to-day administration and serve as the ex-officio member secretary.
The board will also comprise four representatives each from gig worker groups and aggregator platforms, along with two civil society members with experience in the gig economy. A technical expert in data and IT systems may also be brought on as a special invitee when necessary.
With this ordinance, Karnataka becomes the first Indian state to roll out a structured legal framework aimed at extending rights and social protections to the gig workforce that powers India’s growing digital economy.
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