Reimagining Fairness: A Case for Collective Bargaining Rights of Gig Workers


In the blink of an eye, within a mere 10 minutes, we can have our desired items delivered to at our doorstep, courtesy of the pulsating veins of the Indian gig economy. A realm where summoning not just cab rides but even haircuts is as easy as a flick of the wrist. However, within this bustling gig economy lies a darker reality. A closer inspection reveals a narrative far removed from its glossy exterior—a narrative cloaked in shadows of exploitation and legal uncertainty. Within this complex tapestry, gig workers, often celebrated for their adaptability, find themselves entangled in a web of ambiguity and exploitation, painting a stark picture of contemporary employment dynamics.

The convenience of doorstep delivery often comes at a cost for gig workers, who frequently contend with uncomfortable and precarious working conditions. A 10-minute delivery promise means gig workers must always be on their toes to fulfil this commitment, lest they face penalties for failure. This coupled with the low wage, no job security exemplifies the challenges faced by gig workers and how their terms are often dictated by the platforms.

Despite their theoretical entitlement to extensive protections under legislations such as the Social Security Code of 2020, which promised solace, reality remains bleak. Three years on, those protections ring hollow, as the provisions under the Code relating to gig workers and platform workers are yet to come into force. It is time to seek tangible solutions, not just token gestures, to uplift these essential workers.

Collective Bargaining as a Solution

While the idea of granting gig workers employee status is often seen as a solution to various challenges, especially regarding accountability, the reality is much more complex, particularly in the Indian context. Whether these workers are deemed employees hinges on a multitude of factors and tests, such as the three-pronged ABC test established in the Dynamex Operations West, Inc. v. Superior Court of Los Angeles. A similar test has also been Hussainbhai, Calicut v. The Alath Factory Thozhilali Union, where factors like economic control over employees were pivotal in determining the employment relationship.

Unlike in developed countries like the United Kingdom, where the Supreme Court classified Uber drivers as employees, the situation in India differs significantly. India’s economic landscape adds layers of intricacy. Although estimates suggest the gig economy to potentially offer 350 million jobs by 2025, understanding its nuances is crucial. The Indian gig economy, still emerging, owes some of its growth to relaxed labour policies. Thus, imposing burdensome regulations on start-ups and expanding companies could stifle growth, potentially leading to scaling back operations, thereby detrimentally affecting the economy and those involved in the gig economy.

The government’s reluctance to classify gig workers as employees reflects an understanding of the economic environment. Such classification might reduce job opportunities and increase uncertainty for gig workers.

Given this backdrop, it becomes essential to strike a delicate equilibrium between the burgeoning needs of the gig industry and the fundamental rights of gig workers. Assessing gig workers’ ability to voice concerns and influence their working conditions is crucial.

While individual workers often find themselves lacking the advantage needed to compel employers to implement necessary reforms. However, a union representing a significant number of workers can wield substantial influence by potential production disruptions, mass resignations, or organizing impactful protests that garner public notice. Throughout the 20th century, collective action has played a pivotal role in securing workplace rights. Despite the waning strength of labour unions since the 1970s, they remain a prevalent avenue for protest and mobilization against workplace injustices such as discrimination, harassment, and exploitation. Hence, it is imperative to explore avenues for integrating collective bargaining rights within the existing antitrust framework.

However, gig workers also face legal barriers hindering their ability to organize and advocate for their rights. The classification of gig workers as “enterprise” under Section 2(h) of the Competition Act, 2002 presents a formidable challenge, as any attempt at collective bargaining is deemed antithetical to competition.

Collective Bargaining In the Indian Antitrust Framework

Section 3 of the Competition Act prohibits anti-competitive agreements, delineating three requirements for an agreement to be considered anti-competitive. Firstly, it must involve legal entities engaging in economic activity. Secondly, the agreement should pertain to the distribution of goods or provision of services. Thirdly, it must cause or have the potential to cause an appreciable adverse effect on competition. The question arises whether the gig workers trade unions fulfil these criteria.

The Supreme Court, in Competition Commission of India v. Steel Authority of India Limited, interpreted the term “person” liberally, indicating inclusivity under the Act. Additionally, the broad definition of “enterprise” encompasses natural and legal persons. Trade unions, aiming to regulate relations between employees and employers, inherently engage in economic activity, thus satisfying the second requirement. Despite their aim of collective bargaining, trade unions entering into agreements restricting trade, face judicial scrutiny, as it was evident in FICCI-Multiplex Association of India v. United Producers. Thus, such unions can meet all three requirements of Section 3 when involved in anti-competitive agreements.

Turning to the Trade Unions Act, 1926 (TU act) for potential protections, it remains ambiguous whether the associations formed by gig workers are covered by the Act. Regardless, Section 18 of the TU Act, which provides protection against civil proceedings, is not applicable due to the overriding effect of the Competition Act, as stated in Section 60. While Section 62 mandates a harmonious interpretation, recent Supreme Court rulings, such as in Competition Commission of India v. M/S Fast Way Transmission, have affirmed the Competition Commission of India’s (CCI) overriding power in the interest of economic development. Furthermore, Section 19, which protects agreements made within trade unions, does not preclude the applicability of Section 3, as it does not render agreements in restraint of trade void. The absence of explicit exemptions for trade unions in past competition laws suggests a legislative intent to subject them to current competition regulations.

Such a stance may have far-reaching consequences for both the welfare and rights of workers and the efficiency and innovation of the market. Therefore, it becomes imperative to re-evaluate and reform the Indian antitrust regime to accommodate and facilitate collective bargaining by workers in the evolving gig economy.

Way forward: Incorporating Collective Bargaining within India’s Antitrust Framework

To address the challenges facing gig workers and their ability to engage in collective bargaining effectively, a more detailed and nuanced approach is warranted. However, the CCI has historically maintained a stringent stance on exemptions, with little consideration for societal benefits. The “fair share to customers” criterion mandates that the benefits of any agreement must directly affect the customers involved, rather than society at large.

In contrast, the Dutch Competition Authority presents an alternative perspective by asserting that safeguarding the interests of employees and self-employed individuals can enhance overall production. This viewpoint draws upon the precedent set by the 1977 Metro case, which highlighted the economic advantages of a distribution agreement for the supply of goods.

The forthcoming guidance from the CCI on Section 3 of the Competition Act or the introduction of a formal block exemption provides an opportunity to address ambiguities and potentially broaden the scope of collective bargaining rights to encompass genuinely self-employed workers. The Competition (Amendment) Act enacted in Ireland in 2017 offers a noteworthy model, granting collective bargaining exemptions to “false self-employed” and “fully dependent self-employed workers” with clear definitions for these categories. Adopting a similar approach could significantly bolster the bargaining power of a substantial portion of the gig workforce.

Another avenue worth exploring is the De minimis exemption, which offers promise for advancing collective bargaining, particularly for platform workers. This principle stipulates that prohibitions against cartels do not apply when the impact on market competition is negligible. Expanding this exemption could provide a legal framework for collective agreements among platform workers, enhancing their bargaining power without unduly disrupting market competition.

In Australia, the Australian Competition and Consumer Commission ACCC has taken steps towards this direction by proposing a class exemption enabling businesses and independent contractors with an annual turnover below $10 million to engage in collective bargaining with customers or suppliers. This approach could be extended to genuinely self-employed workers, simplifying the legal landscape and eliminating the need for further clarity.

Furthermore, the European Commission is considering policy options for collective bargaining for the self-employed, which may include clarifying the application of the De Minimis exemption to such workers. This is part of a broader effort to address the unique challenges faced by platform workers and other solo self-employed individuals in the gig economy.

Furthermore, employing a rule of reason analysis in evaluating collective bargaining efforts can offer a more nuanced and comprehensive framework. This method involves a balanced assessment of the potential procompetitive and anticompetitive effects of collective agreements. Rather than out rightly deeming such agreements illegal, this analysis allows for a thorough examination of their actual impact on market dynamics, considering factors such as market structure, platform or customer market power, competition among workers, and the specifics of collective agreements.

Moreover, this evaluation extends to broader societal implications, encompassing consumer benefits, productivity enhancements, innovation stimulation, and overall social welfare improvements. It also considers positive outcomes like reduced inequality, discrimination, and conflicts against any potential negative effects. This holistic approach could significantly inform the CCI and other regulatory bodies in understanding and shaping the role of collective bargaining within the gig economy, fostering a fairer and more equitable working environment.

(This post has been authored by Pranjal Kushwaha and Jigyasa Bohra, law students at the National Law Institute University, Bhopal)

CITE AS: Pranjal Kushwaha and Jigyasa Bohra, ‘Reimagining Fairness: A Case for Collective Bargaining Rights of Gig Workers’ (The Contemporary Law Forum, 1 June 2024) </>

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