Telangana to enact gig workers Act: Protections include notice period, welfare fund

Hyderabad: Food delivery aggregators in Telangana will soon be required to provide a seven-day notice before terminating delivery workers if the proposed Telangana Gig and Platform Workers Bill becomes law. The state labour department has prepared draft legislation to provide welfare benefits, job security, insurance, and other rights to nearly 4 lakh gig workers across the state, including food delivery personnel, cab drivers, and package couriers. Officials aim to enact the bill on 1 May, International Workers' Day.

"An aggregator or platform may terminate a gig or platform worker only after following the principles of natural justice, conducting due inquiry, providing valid written reasons, and giving seven days’ prior notice," states the draft bill, now available for public feedback. "However, if a physical or mental threat to the end consumer is foreseen, the gig worker may be terminated immediately."

The legislation will establish a dedicated board and welfare fund for gig workers. All aggregators and platforms must register with the board within 45 days of the Act’s commencement. The board will maintain and publish a register of all aggregators operating in the state on its web portal.

The Telangana Gig and Platform Workers' Social Security and Welfare Fund will receive money from multiple sources, including welfare fees levied under the Act, contributions from workers towards specific social security schemes, government grants, Corporate Social Responsibility funds, donations, and other prescribed sources.

The government will charge aggregators a Welfare Fund Fee ranging from one to two percent of each worker’s payout per transaction. Different rates may apply to different types of aggregators, as specified by the state government. Platforms failing to pay required amounts will face interest charges at government-notified rates.

All platform-based transactions will be tracked through a Welfare Fund Fee Verification System (WFFVS) administered by the state government and monitored by the board. Every payment to workers and welfare fees deducted by platforms must be reported to this system, which will disclose details of collected and spent welfare funds.

The bill includes significant penalties for non-compliance. Aggregators that fail to pay welfare fees face imprisonment of up to one year, fines up to ₹2 lakh, or both. Those who fail to submit required returns, reports, or statements may be fined up to ₹50,000. Offences under the Act are cognisable, bailable, and compoundable, with trials conducted by Judicial Magistrates of the First Class following procedures prescribed in the Bharatiya Nagarik Suraksha Sanhita, 2023.

Offences may be compounded either before or after prosecution upon application by the offender and payment of prescribed fees.

By requiring registration of platforms, creating dedicated welfare mechanisms, and establishing clear penalties for violations, Telangana aims to balance the flexibility of gig work with essential worker protections.

The government’s initiative comes as gig work continues to expand across India, with workers often facing precarious employment conditions, unpredictable earnings, and few legal protections.