Decoding the Legal Identity of India’s ‘Invisible Wheels’

Suppose, you come home after a very exhausting day at work, and all of a sudden you get struck by a headache. You go and open the medicine cabinet, only to realize that it is empty. You do not hesitate at that point, instead you pick up your phone, simply press a button and in the next 10 minutes, you hear your ringing door bell.

In our case, it is an act of mere convenience- a luxury of the present and a development that seems like magic. However, for the individual on the other side of the door, the 10 minutes are a high-stakes gamble. What we see is the brown paper bag or the delivery box; we are not shown the rider who has just made it through the life-threatening traffic, disobeyed a red light and disregarded their own physical fatigue just because an algorithm requires them to keep its timer.

The sharp difference between consumer comfort and worker precarity is a matter which recently got highlighted and came to the forefront of national discourse, courtesy of one of the representatives of the Rajya Sabha, MP Mr. Rajhav Chadha. He rightly referred to such people as “the invisible wheels of the Indian economy.”^[1] His intervention provided as a catalyst to a historic change leading to the formal enforcement of the halted piece of statue-  The Code on Social Security (herein “SS Code”), 2020,^[2] on November 21, 2025.

Understanding Who is a 'Gig Worker'?

Over the years, these workers were referred to as “partners” on the digital platforms to evade the legal burdens associated with being considered as employees. The new SS Code eventually brings this nomenclature game to an end, finally giving it a statutory definition. Under Section 2(35), a Gig Worker is defined as: 

“A person who engages in a work or any type of work arrangement and derives income out of it without a traditional employer-employee relationship.”^[3]

The applications that we access on our mobile devices such as Zomato, Swiggy, Uber, Urban Company are now legally deemed to be “Aggregators.”^[4] The very fact that the law refers to them specifically shows that, even though the relationship is not traditional, the liability of the platform is indeed very real at the present time.

 

The Organized vs. Unorganized split: From a Data point of view.

In order to see why this Code represents a breakthrough moment, we first need to examine the macro-picture of the Indian labour market. Based upon the data provided by the Economic Survey 2025-26 which was published recently in 2026^[5], labour force in India is divided into a very sharp and disproportionately structured hierarchy:

The Unorganized Sector: It is estimated that approximately 88-90% of the entire workforce in India is from the unorganized sector, having no formal contracts as well as no safety net.

The Gig Workforce: This category has grown by 55% since 2021 due to rapid digitalisation and it has a presence of more than 12 million workers.

In the past, gig workers were unfortunately placed within the unorganized pile without any particular protections. The government is trying a semi-formalization of this strong and substantial army of 12 million by passing the SS Code.

What has Changed? The New Benefits

A delivery rider or a cab driver was effectively a legal ghost before the enforcement of the Code in 2025. Should they be involved in an accident, the platform would just deactivate their ID - and end their livelihood without a single rupee in compensation. However, the SS Code 2020 redefines this relationship by providing a multi-layered safety net that transfers these workers from being disposable partners into participants who are safeguarded now.

Under Section 114 of the Code, the platforms are the ones to bear the financial liability. Now, aggregators (such as Zomato, Swiggy, and Uber) are required by law to donate 1-2% of their annual turnover to a specified Social Security Fund.^[6] This statutory tax will guarantee that the enormous valuations of these Unicorns give a direct dividend to people on the ground. In order to regulate and manage this, employees are being enrolled to the e-Shram portal under a Universal Account Number (UAN).^[7] This gives it benefit portability- in case a worker transfers Swiggy to Blinkit, they carry their social security profile and other benefits with them and hence they create for themselves a permanent, digital identity based on Aadhaar.

In addition to these pillars, the Code facilitates a broad umbrella of protections that the gig economy had never dreamed of before. This consists of Life and Disability Cover for on-job accidents, Health and Maternity Benefits (which is usually interconnected with Ayushman Bharat), and the system of pension. This was cemented in the report by the Parliamentary Standing Committee on Labour, which required registration to be obligatory and platforms to be put under a strict liability. By transforming social security into an obligatory legal right rather than a voluntary CSR, the Code has finally initiated the process of formalization of a sector that was originally characterized by a complete absence of rules.

The Recovery Alarm: Report of the Parliamentary Panel

During the period in which the Code has been in action, a strong Parliamentary Standing Committee on Labour, under the chairmanship of Basavaraj Bommai, came up with its report on March 17, 2026.^[8] The findings of the panel further substantiate the Parliamentary concerns so raised:

Compulsory Registration: The panel pointed out that there is a significant number of workers who are still off the books. It has suggested that aggregators must necessarily enroll all individual workers on the e-Shram portal, or else penalties would be imposed.

The 90-Day Trap: The panel also reiterated one of the notable critiques of the Draft Rules 2025, in which a worker has to serve 90 days before he or she becomes eligible to obtain insurance cover. The committee cautioned that such a threshold could be misused by the companies to filter out workers right before they attained the level of eligibility.

Invalid Deactivations: The panel has proposed the establishment of a system of redressing grievances to allow an algorithm to not terminate a worker without being reviewed by a human authority.

The Legislative Gap between Centre and State

It is essential to take note of the fact that, though the Central law is a commendable commencement, state governments are being far ahead and much stronger with their robust and proactive approach.

Rajasthan^[9] & Karnataka^[10]: The States have well incorporated Welfare Boards where workers will be given a legal seat at the table. These state laws, in contrast to the Central Code, which considers social security as a top-down benefit, approaches it as a negotiated right.

The paradox of “Employee”: The Central Code had yet to accept the status of “Employee.” This implies that, for instance, a Swiggy rider who may receive a cover on accident, will still not rightfully receive minimum wage or maternity leave. They are given “Social Security” but at the same place denied “Industrial Rights.”

Conclusion; From Charity to Dignity

The implementation of the SS Code is undoubtedly a win for the invisible wheels of our economy, however, it remains incomplete for now. It should sink in our minds that the individual who brings our 10-minute convenience is an essential part of the Indian growth story. The country is not offering them charity by giving them basic insurance; rather, it is the minimum that a trillion-dollar economy ought to provide to its workers involved in the economic functioning.^[11] As long as the legal employer-employee relationship is not established, they will continue to remain in the name of “partners” while in reality, still in the captives of the algorithm.

Author: Deeksha Kumari, in case of any queries please contact/write back to us via email to chhavi@khuranaandkhurana.com or at  Khurana & Khurana, Advocates and IP Attorney.

^[1] PTI, ‘AAP’s Raghav Chadha demands ban on 10-minute delivery services, protection for gig workers’ The Hindu (New Delhi, 5 December 2025)

https://www.thehindu.com/news/national/aaps-raghav-chadha-demands-ban-on-10-minute-delivery-services-protection-for-gig-workers/article70361292.ece accessed 19 March 2026.

^[2] The Code on Social Security 2020 (Act 36 of 2020).

^[3] The Code on Social Security 2020, s [2(35)].

^[4] The Code on Social Security 2020, s [2(2)].

^[5] Ministry of Finance, Economic Survey 2025–26 (Department of Economic Affairs, 2026) [insert page or paragraph number].

^[6] The Code on Social Security 2020, s [114(4)].

^[7] The Code on Social Security 2020, s 113.

^[8] Standing Committee on Labour, Textiles and Skill Development, Fifteenth Report on Demands for Grants (2026-27) of the Ministry of Labour and Employment (basavaraj bommai ch, 2026).

^[9] Rajasthan Platform Based Gig Workers (Registration and Welfare) Act 2023, s 3.

^[10] Karnataka Platform Based Gig Workers (Social Security and Welfare) Act 2025, s 10.

^[11] Ministry of Finance, Economic Survey 2025–26 (Department of Economic Affairs, 2026) ch 12, para 12.1.