Why Telangana’s new law is a major step for gig worker dignity

The Telangana Act goes beyond symbolic recognition and establishes binding corporate obligations and institutional structures. Section 3 of the Act provides for the establishment of a Platform Based Gig Workers Social Security and Welfare Board, which is a tripartite body comprising the government, platform aggregators and gig workers, with a mandatory statutory reservation for women and persons with disabilities. This Board is charged with the responsibility of assigning a Unique ID to each registered worker covered by Section 10 and providing a direct digital link to the allocation of welfare benefits without the intermediary slippage.

The main challenge to formalising unorganized labour has always been the financing of this welfare net. Unlike conventional wage-deduction schemes, Section 19 creates a welfare fund, which is funded by a non-transferable welfare fee of 1% to 2% on the transaction value of all platform-based services or orders. Importantly, the Act clearly bars aggregators from withholding this fee from the base payment of the workers, or from imposing the compliance fee on the base payment of the workers. This is complemented by the government grants and allocation of Corporate Social Responsibility (CSR) to provide for insurance, accident, pensions and maternity benefits.