November , 2020
Plight of delivery agents in distressed gig economy
11:25 am

Kuntala Sarkar



As the pandemic related lockdown was implemented, people started to order from online platforms even more. But delivery agents who stand at the last stage of the supply management chain are an essential part of this retail ecosystem. The socio-economic conditions of the delivery agents are now a matter of concern. The online platformisation of the retail sector during the festive season has seen a substantial spike despite the overall economic lull. However, the situation of the delivery agents did not improve much.


Delivery agents in the context of gig economy


Most of the delivery agents of retail and food supply segments in India are contractual or gig workers. The gig economy in India is at a relatively nascent stage but growing rapidly. India, due to its sheer number of the working population - many of whom are getting connected digitally - has found a growing acceptance to the gig economy. These workers stay distant from any fixed commitment with the company and they do not majorly demand social security. But in India’s context, the situation is quite different. Most of the blue-collar workers or delivery agents associated with Bigbasket, Flipkart, Amazon, Zomato or Swiggy did not choose to become gig workers initially. In absence of available permanent jobs with adequate security, they were forced to join these tech-platforms - even with poor salaries.


Regarding this new age workforce, the ‘Gig Report 2020’ published by industry body ASSOCHAM informs, “It currently values the global freelancer market at $2-3 billion which is growing at an annual rate of 14%. India currently accounts for $1 billion of the global market. While the US is leading the race with 53 million independent workers, India has 15 million freelancers with its gig economy.” But the accurate figure of total delivery agents in India is not available as there are so many large-mid-small-scale companies that are operating and not all of them reveal their employee strengths. Only Swiggy had more than 2.2 lakh delivery partners in around 500 cities in India before lockdown.


Distressed gig workers


Varied sectors like IT, ITES, BPO, content writing and designing along with the delivery agents are included in the list of total gig workers. Importantly, in August, a survey by Flourish Ventures, a global fin-tech venture capital fund informed that almost 90% of gig workers (conducted among ride-sharing drivers, delivery workers and house cleaners) in India have lost income during the pandemic. More than a third of these gig workers were getting only around `5000 per month. Their survey also added that 44% of the respondents had resorted to borrowing, 45% have cut consumption, 83% have used their savings and 57% have acted on the loan moratorium to reduce or halt payments on their debts. So, the most significant difference between gig and permanent workers is that the former is never secured in a time of national emergency. 


According to the social security code approved by the central cabinet recently, gig companies will have to make a contribution towards social security funds set up for gig and platform workers. The code will also enable provisions to allow self-employed workers to mark voluntary contribution for the Employees’ Provident Fund (EPF). According to some economists, it is the first time that the concept of gig and platform workers has been recognised.


Only in the Noida area, there are around 2000 Swiggy delivery agents who are protesting and demanding for better payments under the banner of All India Gig Workers’ Union (AIGWU). A video footage of a Swiggy agent, released by the union available in Twitter revealed that the company is giving a false statement of giving `45 per order. In reality, they delivery partners are currently getting around `15 per order for approximately three km delivery journey. They are not even getting the bonus and incentive. 


Rikta Krishnaswamy, Delhi State Organiser, AIGWU, told BE, “The situation of delivery agents of the online retail sector has always been poor and the pandemic has only increased the insecurity with major pay cuts. Now it has worsened because of the increasing unemployment ratio and so many people are now desperately willing to get back to their jobs. Additionally, the medical costs have spiked and not all of them have insurance. Presently, the companies are hiring more gig workers but they have reduced the total number of orders for everybody. Also, the problem varies for different companies. For Swiggy, in the beginning of the lockdown, the company said that they were cutting the salaries for the time being. When the orders will go up, the salaries will improve too. But in reality, it is not happening. Even after the situation has recovered, the salaries have remained same. On the contrary, for Zomato, initially they did not do huge pay cuts. But later on, the company started to curtail salaries.” According to Hurun India Unicorn Index 2020, Swiggy and Zomato are valued at around $3.5 billion each and they jointly are at the fifth position of the valued unicorns in India. When big companies like them are accused of such injustice, the condition in small scale tech-based retail goods or food delivery chains can be well realised.


Since the lockdown started, migrated workers started to go back to their native villages and most of them lost their jobs. Mumbai, Bengaluru, Delhi NCR, Hyderabad and Chennai are the major destinations of migrant workers. Before the festive season, as they wanted to get back to their jobs, they had to join with much lesser salaries.


Krishnaswamy added, “Our protests are now more visible in big cities like Delhi NCR but every corner of the country is having similar sufferings. For south India, the big gig workers’ strike started in Chennai and then expanded to Hyderabad. Exploitation is rising and the ground is correct for unionisation of these gig workers. To intensify the movement, we will include more company workers - expanding in different parts of the country. If the exploitation increases, we can also go for a nationwide strike.”


Sabrina Korreck, in a paper titled ‘Covid-19 and India’s Gig Economy: The Case of Ride-Hailing Companies’ for the Observer Research Foundation (ORF), wrote, “Gig work is associated with a higher degree of informality. With less employment rights, drivers lack adequate protections and are therefore more vulnerable. The crisis must be understood as a wake-up call to reconsider social protection mechanisms for gig workers and challenge their status as independent contractors.”


The spike in tech-based retail delivery companies have offered a breathing time to the worsening employment situation in India by offering some contractual jobs. Even during the lockdown, since the second quarter of the current fiscal before the festive season, companies like Amazon, Flipkart, Bigbasket started to ramp up their gig work force. For the already distressed workers, it will be a sign of hope if these companies provide better employment opportunities with adequate salaries. 

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