The High Cost Of Convenience: A Critical Analysis Of Social Security Code 2020 And State Regulations In India's Ride-Hailing Sector

Anushka Sharma, OP Jindal Global University

ABSTRACT

This paper examines the complex realities faced by ride-hailing platform drivers in India, focusing particularly on the disconnect between the promised entrepreneurial opportunities and the actual working conditions they encounter. Through analysis of protest documentation, and policy frameworks, this paper reveals systematic issues plaguing India's ride- hailing sector. The study finds that drivers face multiple challenges: aggressive commission structures (often exceeding the regulated 20% cap), mounting debt from vehicle loans, lack of promised insurance coverage, and absence of effective grievance redressal mechanisms. Despite generating substantial revenue (₹2,799 crores for Ola in FY2023), ride-hailing platforms have failed to ensure fair working conditions and stable incomes for their driver partners.

The research documents emerging forms of worker resistance, including traditional strikes and innovative "digital protests," where drivers collectively manipulate ride cancellations to pressure platforms for reforms. The paper critically evaluates recent legislative attempts to regulate the sector, particularly the Social Security Code 2020 and state-level initiatives like the Rajasthan Platform-Based Gig Workers Act 2023. It identifies significant gaps in these frameworks, including ambiguous worker classifications, complex registration requirements, and inadequate enforcement mechanisms. Drawing comparisons with international regulatory approaches—such as the European Union's directive on short- term contractors and California's ABC test—the study highlights potential pathways for reform in the Indian context.

The findings suggest that while India's gig economy has facilitated rapid market expansion and service accessibility, it has done so at the cost of worker welfare. The paper concludes that sustainable growth in the ride- hailing sector requires balancing platform profitability with worker protections through clearer legislative frameworks, stronger enforcement mechanisms, and mandatory operational transparency.