Zomato, Swiggy, Amazon & IAMAI challenge Karnataka gig worker welfare law in HC
Major platforms moved Karnataka HC against the Platform-Based Gig Workers Welfare Act, arguing its 1-2% welfare-fee levy duplicates the central social security code. The contested cess could cost aggregators INR 250-300 crore annually, affecting ~5 lakh gig workers statewide.
What happened
IAMAI, Zomato, Swiggy, Zepto, Amazon and others moved Karnataka HC challenging the state's Platform-Based Gig Workers Welfare Act, citing duplicate welfare-fee
Key facts
- 1 per cent commission contribution
- 1-2 per cent central law turnover
- 50 paise/75 paise/Re 1 per transaction cap
- INR 250-300 crore annually
- 5 lakh gig workers
- 2.75 lakh Bengaluru workers
- 16-member welfare board
Why this matters
Platforms are litigating the state cess as duplicative of the central social security code, a precedent-setting fight whose resolution will shape multi-state gig-labor cost structures and consolidation economics.
What to watch
- HC ruling on interim stay application
- Central government stance on whether state cess duplicates the labour codes
- Replication signals from Rajasthan, Telangana, Jharkhand gig welfare laws
- Platform fee/commission changes signaling cost pass-through
- Gig worker union response and political pressure in Karnataka
- Platforms file for interim stay to suspend cess accrual pending verdict
- IAMAI coordinates joint industry affidavit citing central Social Security Code precedence
- Aggregators model cost pass-through scenarios into fee structures and gig-worker payout terms
- Karnataka government defends levy and may accelerate welfare board operationalization to show worker benefit
- Other state governments monitor outcome before activating their own gig welfare cess provisions