The Internet and Mobile Association of India (IAMAI) has expressed concerns regarding the draft Karnataka Gig Workers’ Bill, cautioning that it could hinder business operations and adversely affect the ease of doing business in the state. IAMAI, which represents over 600 Indian and multinational digital services companies, has urged the Karnataka government to extend the stakeholder consultation period by 30-60 days.
IAMAI emphasized the evolving nature of the gig economy and the broad implications of new regulations for workers, platforms, and the ecosystem. In a letter to the state labor department, IAMAI stated, “All stakeholders must have an opportunity to provide inputs and voice their concerns before such a law is enacted.”
The association urged the state government to reconsider certain clauses in the bill, highlighting the need to balance gig worker welfare with realistic expectations for aggregators. IAMAI pointed out that the Code on Social Security already requires aggregator companies to contribute 1-2% of their annual turnover to the Social Security Fund. The draft bill’s proposal for a similar levy on gig workers could impose a dual financial burden on aggregators, many of whom are operating at a loss.
IAMAI criticized the draft bill for its lack of clarity on benefits for gig workers. The association noted that mandatory registration and benefit implementation are challenging due to the dynamic nature of gig work. “Mandating perpetual registration for gig workers creates an unnecessary administrative and financial burden on both workers and aggregators,” IAMAI stated. The association explained that gig workers often work across multiple platforms and diverse job types, complicating accurate tracking of their work status and earnings.
IAMAI highlighted that the proposed fees in the draft bill could significantly increase operational costs for aggregators, potentially impeding the sustainable growth of the gig economy in Karnataka. The draft bill suggests calculating welfare fee contributions based on either a percentage of a gig worker’s transactional pay or the aggregator’s annual turnover, as determined by the state government. IAMAI expressed concerns that a percentage charge on transactions could disproportionately burden platforms with higher transaction volumes, while a turnover-based model could unfairly impact conglomerates with multiple businesses, some of which do not employ gig workers.
IAMAI also raised concerns over a provision to map transaction-level payment data to a proposed Central Transaction Information and Management System (CTIMS), citing potential impacts on aggregator competitiveness and data privacy laws.
The association suggested a more flexible approach to the mandatory 14-day termination notice, considering specific termination circumstances and allowing exceptions for serious misconduct or legal violations by gig and platform workers. IAMAI stated, “The mandatory 14-day termination notice lacks flexibility in addressing situations such as law and order issues, violence, or stolen packages.”
IAMAI’s feedback underscores the complexity of regulating the gig economy and the importance of a balanced approach that considers the interests of all stakeholders. The association’s concerns highlight the need for thoughtful deliberation to ensure the bill supports gig workers’ welfare without stifling business operations in Karnataka.
