Union Budget 2026: Can India’s gig workers finally get social security and recognition? | SME Futures

The gig economy has emerged as one of the fastest-growing segments of the Indian labour market. As discussions around Budget 2026 gather pace, the gig economy is moving into sharper focus. Given that, understanding who these workers are and what do they expect from Budget 2026 has become significant not just for government, but from businesses, digital platform and wider economy.  

Who are gig workers? 

Gig workers are people engaged in flexible and task-based work instead of fixed, long-term jobs. In India, they operate across sectors like app-based deliveries, ride-hailing services and even task marketplaces. One big chunk of this gig workforce are the people that facilitate easy access to groceries, medicines, food, and cabs.  

These workers often navigate through uncertain incomes, limited social protection, and minimal legal safeguards. 

Despite these challenges, gig workers contribute significant to the economy.  Estimates by NITI Aayog project that gig workforce economy will grow on a fast pace as digital platforms proliferate and consumer demand for on-demand services skyrockets. 

What is meant by ‘gig economy’? 

The gig economy refers to a labour market characterised by short-term, flexible jobs, often facilitated by digital platforms, that differ from traditional full-time employment. Instead of fixed monthly salaries, workers are paid per task, delivery, ride, or assignment. These ‘gigs’, encompass roles such as app-based delivery personnel, ride-hail drivers and such. 

The rise of e-commerce and quick commerce platforms has pushed this segment into the spotlight. While technology enables flexibility and instant income opportunities, it has also created a class of workers who lack basic social security, predictable earnings, and workplace protections. 

Labour Codes 2025 recognise gig workers 

In a major milestone, India formally defined gig and platform workers under the Code on Social Security, extending statutory social security coverage to these categories for the first time. 

The new code defines these categories.  

• Gig workers earn income from work or working arrangements that fall outside a traditional employer-employee relationship. 

• Platform workers participate in a working arrangement that falls outside of a traditional employer-employee relationship, using an online platform to render services. 

• Aggregator refers to a digital intermediary or a marketplace for a buyer or user of a service to connect with the seller or the service provider. 

• Unorganised Workers are self-employed, home-based, or wage workers in an enterprise owned by individuals or self-employed workers engaged in the production or sale of goods or the provision of any services. 

The Code empowers central and state governments to design social security schemes covering life and disability insurance, health and maternity benefits, old-age protection, and provident fund–like benefits.  

It also proposes a National Social Security Board to recommend suitable welfare measures and authorises the government to mandate aggregator contributions of 1–2% of annual turnover, capped at 5% of payouts to workers, towards a Social Security Fund. 

If aggregators fail to make timely contributions, they may be required to pay interest on unpaid amounts. But the code allows the Central Government to exempt certain aggregators or classes of aggregators from contribution requirements. It also further authorises the Central Government to prescribe conditions under which a worker’s status as a gig or platform worker may cease. 

To access benefits, gig and platform workers must register with the government, supported by a dedicated toll-free helpline. 

By defining these categories, India lays a legal foundation for expanding social security protections to millions of workers engaged in non-traditional labour arrangements. 

Union budget 2025: Milestone for gig economy 

Last year’s budget also marked the first official fiscal recognition of gig workers in driving the new-age services economy in India. Government introduced several measures aimed at including them within the broader social security net.  

The reforms mandated registration on e-Shram Portal (national database for unorganised workers) for every gig worker.  

Budget 2025 also extended health insurance coverage to nearly one crore gig workers under the PM Jan Arogya Yojana, offering hospitalisation coverage of up to ₹5 lakh per family per year.  

Besides that, the companies such as Zomato claims to provide gig workers with insurances. Founder & CEO Deepinder Goyal, for instance recently stated that the company provides insurance coverage up to Rs 10 lakh to their delivery partners.  

These steps were widely seen as a structural shift towards integrating gig workers into India’s social security framework. 

The ground reality 

While policy intent is strong, the real test lies in effective implementation. 

A key challenge has been data sharing and registration compliance. For workers to access benefits, platform companies must share data with government systems such as e-Shram. However, delays and gaps have limited effective access to healthcare and welfare schemes.  

Rising discontent and worker mobilisation 

Pay concerns, safety issues, and lack of recognition among gig workers have increasingly triggered protests. Around Christmas and New Year, gig worker demonstrations were reported across several cities. 

While participation was uneven, most workers ended up not participating in the strikes. Many workers cited financial pressures and festive incentives offered by platforms for working on strike days.  

Protests in cities like Kochi, though highlighted issues such as unrealistic delivery timelines, unsafe work conditions, and inadequate compensation. 

These mobilisations underscore a key gap: policy recognition alone does not guarantee dignity and fairness in daily work. 

Huge expectations from 2026 Budget 

Gig workers’ expectations for the 2026 Indian Budget focus on the implementation of social security measures, a guaranteed minimum pay floor, better working conditions and regulatory oversight.  

Following Budget 2025 announcements, there is strong expectation that the Social Security Code, 2020 will be operationalised fully, including a functional National Social Security Fund to provide accident cover, pensions, maternity benefits, and insurance.  

“The gig economy operates without substantial structural support. Budget 2026 is  an opportunity to acknowledge gig workers’ contributions to India’s formal economic growth rather than only recognising their roles as service providers. They need a clear framework around social security, affordable insurance, and portable benefits for gig workers,” says Anirudha Kotgire, Managing Director & Co-founder, Waayu. 

“The 2026 Budget should encourage fair-platform models through targeted tax benefits and developing digital infrastructure that promotes equitable growth,” adds Kotgire. 

Future remains strong 

The future of India’s gig economy looks promising, but only if policy intent is matched with execution. As the country pushes ahead with infrastructure expansion, digital commerce, and logistics-led growth, gig and delivery workers will remain central to this transformation. Ensuring skill development, stronger safety norms, and clear regulatory frameworks will be critical to building a resilient, efficient, and scalable workforce. 

 As Balfour Manuel, Managing Director at Blue Dart, notes, “A parallel focus on the logistics workforce, through skill development, stronger safety norms, and clearer frameworks for gig and delivery professionals, will be vital to building operational resilience and service quality at scale. Together, these measures can help translate the Gati Shakti vision into tangible gains for trade, exports, and national competitiveness, supporting India’s journey towards a Viksit Bharat.” 

Union Budget past year have marked a clear shift in how India views gig workers, moving from informal contributors to a formally recognised segment of the workforce. Mandatory e-Shram registration, access to insurance, and inclusion under labour codes signal a turning point in labour market norms. Yet, progress on the ground remains uneven, with implementation gaps slowing real impact. 

As Budget 2026 approaches, the spotlight is firmly on delivery, on whether policies move beyond announcements to create meaningful security, dignity, and stability for millions of gig workers.