A Paradigm Shift in Labour Law

In a historic overhaul of its labour regulations, the Government of India has officially implemented four new labour codes, effective Tuesday, November 21, 2025, EAT. The reforms consolidate 29 pre-existing central labour laws into a more streamlined framework. A central pillar of this new legislation is the Code on Social Security, 2020, which for the first time in the nation's history, formally defines and recognises 'gig workers' and 'platform workers' under the law. This move is a significant departure from the previous legal landscape where such workers were largely invisible, operating in a regulatory grey area without access to traditional employment protections.

The Promise of a Social Safety Net

Under the new regulations, all workers, including those in the gig economy, are entitled to social security coverage. The law mandates the creation of a dedicated Social Security Fund to provide benefits such as life and disability insurance, health and maternity care, pensions, and accident insurance. To finance this, digital platforms and aggregators—companies like Uber, Zomato, and Swiggy—are required to contribute 1-2% of their annual turnover, an amount capped at 5% of the total payments made to their gig workers. The government's stated aim is to provide a crucial safety net for a workforce that is projected to swell to 23.5 million by the 2029-30 fiscal year, according to a 2020-21 report by the government's policy think-tank, NITI Aayog.

Implementation Hurdles and Elusive Benefits

Despite the progressive legislation, the reality on the ground for India's gig workers remains challenging. The implementation of the social security schemes is in its nascent stages, with both central and state governments yet to notify the final operational rules. This has created a gap between the legal recognition of rights and the actual delivery of benefits. Labour rights experts point to significant operational hurdles, such as the lack of a traditional employer-employee relationship, which complicates contributions. Many workers engage with multiple platforms simultaneously, raising questions about which aggregator is responsible for their social security. Furthermore, there are concerns that the financial burden on aggregators could be passed on to consumers or result in reduced earnings for the workers themselves. Consequently, a vast majority of India's gig workers still find themselves without access to essential protections like health insurance or retirement savings.

Relevance for Kenya and East Africa

India's ambitious reforms offer a critical case study for Kenya, where the gig economy is also a significant and rapidly growing source of employment, particularly for the youth. Digital platforms for ride-hailing, delivery services, and freelance work are increasingly prevalent in Nairobi and other urban centres. Like India, Kenyan gig workers often lack formal contracts and access to social security benefits provided by institutions like the National Social Security Fund (NSSF) and the National Hospital Insurance Fund (NHIF). The Indian model, which places the onus of contribution on the digital aggregators, presents a potential pathway for policymakers in Kenya and the wider East African region to consider as they grapple with extending social protections to this new class of workers. However, the challenges India is facing in implementation underscore the need for a carefully considered and context-specific approach. As noted by the International Labour Organization, the decentralized nature of gig work poses universal challenges in enforcing social security provisions. The success or failure of India's new codes will undoubtedly provide valuable lessons for developing nations seeking to balance the flexibility of the gig economy with the fundamental right to social security for all workers.