Shares of Swiggy Ltd. and Eternal Ltd.-which operate Instamart, and Zomato and Blinkit, respectively-rebounded from the day’s lows after the government pursuaded them to pause 10-minute delivery for the sake of gig workers.
On Tuesday, Swiggy’s share price fell as much as 1.08% but recouped the loss to end the day with 0.43% gains, while Eternal surged 3.24%. The benchmark S&P BSE Sensex fell 0.30%.
That, after Labour Minister Mansukh Mandaviya met representives of quick-commerce firms on the issue of increasing pressure on gig workers and their stressful work conditions. He persuaded them to pause the 10-minute delivery service, to which they have reportedly obliged.
The development comes amid widespread public debate over gig workers’ working conditions, even as India’s looks to imprement a new labour code.
Blinkit removes 10-minute delivery option from app
A cursory check of the Blinkit app showed that the company has removed the promise of 10-minute delivery from its branding.
The company’s tagline has been revised from “10,000 plus products delivered in 10 minutes” to “30,000 plus products delivered at your doorstep”.
Other aggregators are expected to follow suit in the coming days. The move is aimed at ensuring greater safety, security and improved working conditions for gig workers.
India’s labour code for gig workers
The debate over working conditions for gig workers, especially the marketing gimmick of “10-Minute Delivery”, comes weeks after India implemented four labour codes, one of which is tailormade for the gig economy.
India’s new labour codes, particularly the Code on Social Security, 2020, finally defines who a gig worker and who employs them.
- A gig worker works outside a traditional employer-employee setup.
- A platform worker provides service via access to online platforms.
- An online aggregator connects a service provider to the customer.
This lays the foundation for extending welfare benefits to an estimated 40 crore workers in the unorganised sector.
The biggest and most immediate obligation is social security contribution for gig workers by aggregators such as Swiggy and Zomato/Blinkit.
Under the Code on Social Security, 2020, aggregators are required to contibute 1-2% of their annual turover to social security of the gig workers they employ. This amount is capped at 5% of total amount paid or payable by the aggregator to the gig workers. This shifts the responsibility of providing basic social security to the companies that benefit from their services.