In September 2021, the Ministry of Labour and Employment introduced the e-Shram portal to create a national database of unorganised workers. The portal aimed to extend employment and social security benefits to unorganised workers, including migrant, gig, and platform workers. The gig economy in India is steadily growing and expected to expand to an estimated 90 million workers. The Indian workforce is witnessing a revamp in its traditional idea of unorganised workers owing to the expansion of tech-based platform services such as Swiggy, Uber, and Urban Company. ASSOCHAM projects that the gig economy in India will increase by USD 455 billion by 2024. However, this burgeoning platformisation is likely to result in the gig workforce falling through the gaps of existing labour welfare delivery systems.
While innovations in LendTech and InsurTech have attempted to expand their scope to cover gig workers, the scope of this expansion remains limited to white- and grey-collar workers. The increase in on-demand delivery platforms is not only changing the consumer market for services, but also changing the relationship between workers and employers within these spaces. Although gig work offers greater contractual flexibility to both the employer and the worker, it also creates a grey zone in defining employers’ liability towards their workers in terms of welfare and other benefits.
In this evolving landscape, the Indian governance ecosystem has a unique opportunity to reconfigure labour welfare delivery and integrate workers and platforms to enhance efficiency.
In 2019, the new labour codes recognised a working definition of gig workers with the intention of expanding labour protection and welfare entitlements to them. However, the expansion remains limited at present. The current system imagines a singular employer paradigm, which involves a contract between two entities where the modalities of provident fund and ESIC are tied to that employer. In the gig economy, however, the multi-contract nature of work increasingly farms out the welfare liability, thereby creating gaps in the welfare delivery infrastructure. Thus, welfare for gig workers must be reconceptualised in a way that recognises the vulnerabilities created by their hypermobility across platforms. As newer mandates for labour welfare delivery accommodate platform and gig workers, the expansion of e-governance initiatives for labour such as e-Shram, MeeSeva, and MahaOnline provide a unique opportunity for India to facilitate better integration of workers.
Learning from digital ecosystem initiatives
Over the last decade, India has been expanding its portfolio of e-governance and open digital ecosystem initiatives, which are changing the means of service delivery to its citizens. So far, digital initiatives such as India Stack, National Health Stack, and DIKSHA have created space for reimagining collaborative stakeholder engagement through DigiLocker. This enables authenticated data sharing and inter-agency coordination, which reduces arbitrage.
Enabling civil society organisations (CSOs) and employers to directly seed workers’ registration data into relevant state and central databases will help reduce last-mile redundancies.
A plausible way to implement this is for the government labour welfare delivery system to allow gig platforms to seed workers’ data into the state’s labour welfare portal. This will reduce the cost of onboarding workers at the last mile. Due to barriers to access and registration, workers presently incur a high financial and time cost when registering for schemes. They are marred by the information asymmetry between what the schemes say and how they are operationalised. Additionally, they face barriers related to documentation, access, and technology. Enabling civil society organisations (CSOs) and employers to directly seed workers’ registration data into relevant state and central databases will help reduce last-mile redundancies, such as minimising the duplication of work done by the CSOs that onboard workers.
For instance, innovation and API ecosystem initiatives by the state across the vertices of identification and documentation (UIDAI integration) have allowed players in the government, business, and start-up ecosystems to integrate and leverage digital infrastructure to provide cashless service delivery. A consequence of these open APIs has been the creation of innovative service delivery, which reduces the time and cost of the payment-making process through platforms such as Paytm, PhonePe, and Google Pay.
Issue of multiple authentication and registration
As India paves the path for digital labour welfare service delivery mechanisms, it is presented with a unique opportunity to leverage the integration of these evolving platforms and initiatives. Currently, the employment and labour welfare service delivery mechanisms operate in a complex terrain of federal jurisdiction, with labour falling under the concurrent mandate of the state and central government. This complexity is also visible in its e-governance mandate, with labour welfare entitlements being offered under multiple e-platforms.
As was apparent in implementing the CoWIN registration, access to the last mile is fraught with challenges related to literacy and a lack of access to smartphones/devices.
However, any attempt to link databases warrants due consideration of the data quality and authentication processes involved. Currently, workers undergo multi-document authentication processes to avail welfare entitlements. A worker requires documents such as electricity bills, Aadhaar card, ration card, and worker self-declaration forms to avail a bundle of services, including PDS, labour cards, and other social welfare schemes. An attempt to simplify these processes needs to account for the ground realities of workers to reduce exclusion.
For instance, a migrant construction worker is required to be registered under ISMW and BOCW, as well as under UWIN, e-Shram, and the respective state labour portals. In addition to this process being daunting for a low-literacy worker with limited access to digital tech, it is equally challenging for interested CSOs and state departments to help stitch together access to the entitlements for which workers are eligible. The duplication of registration work among the different stakeholders highlights the need to imagine a labour welfare ecosystem that reduces these redundancies and enables interoperability for last-mile implementation.
As was apparent in implementing the CoWIN registration, access to the last mile is fraught with challenges related to literacy and a lack of access to smartphones/devices. This role is largely fulfilled by CSOs and common service centres (CSCs). With the Aadhaar-linked OTP as the primary gateway to accessing a variety of benefits, workers consistently fall through the cracks owing to their prepaid mobile number not being updated/linked with their Aadhaar numbers. Subsequently, they must rely on biometric/IRIS authentication methods, which are currently available only through registered CSCs. This vulnerability also opens them up to exploitation by CSCs, where they are at times upsold non-essential services, such as lamination of government ID cards, at exorbitant prices. The CSCs themselves operate at wafer-thin margins. These appendages in the last-mile delivery system in turn incentivise the exploitation of those that it intends to serve.
Blockchain architecture for labour welfare
Here, imagining labour welfare delivery systems backed with blockchain technology can help reduce redundancies in operations and promote ease of access for workers. A blockchain architecture with appropriate digital and decentralised ledgers between the Centre, state, and local governance structure can help streamline the registration and authentication process, especially for mobile migrant labour in India. Currently, inclusion within the welfare mandate is spread across a plethora of agencies, intermediaries, and offices at the central, state, district, and municipal/village level for both scheme eligibility and benefit disbursement.
As the digital labour welfare infrastructure in India develops, we must reduce perverse incentives and adopt an ecosystem approach that streamlines ease of accessibility and disbursement while pre-empting exclusion.
This is a mammoth task, as is evidenced by the fact that schemes such as One Nation One Ration Card are still trying to gain a functional foothold across states. In the meantime, lessons can be drawn from the success of India Stack, wherein a move towards an integrated labour welfare ecosystem that allows API integrations between various stakeholders, including the different layers of government, state departments, CSOs, businesses, and emergent platforms, can be harnessed. An integrated open API ecosystem that is regulated by secure governmental gateways can facilitate the registration of workers by allowing gig platforms, businesses, and CSOs to interact and directly seed workers’ details into e-governance platforms such as e-Shram or its relevant state-level counterparts. Enabling such innovation in the labour service delivery space will aid an integrated system based on the complementarity of stakeholders’ interests by enhancing the ease of doing business, advancing welfare delivery to workers, and reducing the financial costs for states and workers.
As the digital labour welfare infrastructure in India develops, we must reduce perverse incentives and adopt an ecosystem approach that streamlines ease of accessibility and disbursement while pre-empting exclusion. The welfare infrastructure ought to consider and capitalise on the existing network of stakeholders such as CSOs, platforms, social impact businesses, and employers as partners in development. As India takes steps to digitise its infrastructure, it also needs to scale and advance innovation in its non-digital infrastructure, which enables accessibility for beneficiaries in a landscape marred by inequality and the digital divide. It must also aid digital capacity building and training both within and outside the governance structure. This will facilitate a positive uptake of the digital system at the last mile and reduce redundancies and duplication in processes.