Chapter IX: Social Security for Gig Workers and Platform Workers
Sections 112 – 114The Code on Social Security, 2020 introduces a pioneering statutory framework under Chapter IX mandating the framing of welfare schemes specifically tailored for gig workers and platform workers operating across ride-hailing, food delivery, logistics, and digital platform aggregator ecosystems.
| Scheme Component | Governing Section | Statutory Mandate & Benefit Scope |
|---|---|---|
| Life & Disability Cover | Section 114(1)(a) | Accident compensation, natural and accidental death benefits, and partial/permanent disability insurance coverage funded through aggregator cess. |
| Health & Maternity Benefits | Section 114(1)(b) | Hospitalization support, health insurance coverage, and statutory maternity benefits for female gig and platform workers. |
| Old Age Protection & Creche | Section 114(1)(c)-(d) | Pension/retirement corpus contribution mechanisms, child care facilities, and other welfare assistance schemes notified by Central Government. |
Aggregator Contribution & Social Security Cess Framework
Section 114(4) & (5)Schemes framed under Chapter IX are funded primarily through mandatory contributions from digital platform aggregators. The statutory cess is levied at a rate ranging from 1% to 2% of annual turnover of the aggregator, subject to a strict statutory ceiling not exceeding 5% of the aggregate amount paid or payable to gig and platform workers.
Gratuity Calculation Formula & Fixed-Term Workers Pro-Rata Rights
Chapter V – Section 53Section 53 establishes the statutory entitlement to gratuity payable on termination of employment after continuous service. A landmark reform in the 2020 Code eliminates the 5-year threshold for fixed-term employees, guaranteeing pro-rata gratuity upon completion of just one year of continuous service.
| Statutory Factor | Governing Clause | Statutory Calculation Metric |
|---|---|---|
| Standard Gratuity Formula | Section 53(2) | (15 × Last Drawn Wages × Number of Completed Years) / 26 |
| Fixed-Term Parity | First Proviso to Sec 53(1) | Payable on pro-rata basis for fixed term contracts of 1 year or more, irrespective of 5-year rule. |
| Statutory Ceiling | Section 53(3) | Maximum statutory gratuity cap set at ₹20,00,000 (Twenty Lakh Rupees), unless contract specifies higher. |
Maternity Benefit Scheme Entitlements & Creche Standards
Chapter VI – Sections 59 – 72Chapter VI guarantees comprehensive maternity protection across industrial and commercial establishments:
- Paid Maternity Leave (Section 60): 26 weeks paid leave for women with fewer than two surviving children (maximum 8 weeks preceding delivery); 12 weeks for women with two or more surviving children, adopting mothers, and commissioning mothers.
- Creche Facility (Section 67): Mandatory creche facility in every establishment employing 50 or more employees, permitting four daily visits including rest intervals.
- Work From Home (Section 65): Provision for remote work after 26 weeks where the nature of work permits, on mutually agreed terms.
National Social Security Board & Fund Administration
Section 114 & Section 141Section 141 establishes a dedicated Social Security Fund under Central Government administration for welfare schemes. The National Social Security Board comprises tripartite representation: Central officials, state delegates, five aggregator nominees, and five gig worker worker representatives ensuring transparent monitoring, fund allocation, and claim settlement.