Swiggy, Zepto, Eternal & Meesho's Valmo Challenge Karnataka Gig Worker Law in HC
Consumer tech unicorns, via IAMAI, have moved the Karnataka High Court against the state's 2025 gig worker law, arguing it duplicates the central social security code and imposes arbitrary welfare fees. The law levies a 1% per-transaction welfare fee, capped at ₹0.50 for food/grocery and ₹1.50 for professional services.
What happened
Swiggy, Zepto, Urban Company, Eternal and Meesho's Valmo, via IAMAI, moved Karnataka HC challenging the state's 2025 gig worker law, arguing it duplicates
Key facts
- 1% welfare fee per transaction
- ₹0.50 cap food/grocery
- ₹1.50 cap professional services
- 12 Lakh active gig workers
- 12% annual interest
- ₹1 Lakh penalty
Why this matters
The IAMAI-led joint challenge signals platforms see gig-worker welfare costs as an existential structural risk, making regulatory exposure a key diligence item and potentially accelerating consolidation or in-housing of delivery fleets to control cost variability.
What to watch
- HC interim order on stay of welfare fee collection
- Central government affidavit on code-vs-state-law jurisdiction
- Other states announcing similar per-transaction levies
- Platform earnings commentary on regulatory cost exposure in India
- Welfare board registration numbers and fund disbursement details
- Platforms model fee pass-through scenarios to consumers vs. absorption against unit economics
- IAMAI lobbies Centre to assert primacy of social security code and pre-empt state fragmentation
- Karnataka government defends statute as worker-welfare mandate, may signal openness to rate revision
- Gig-worker unions intervene as respondents to defend the welfare board funding
- Peer platforms (Uber, Ola, Urban Company) watch and prepare aligned positions
Also reported by
- Inc42 · Buzz — Same time