After Reading This Article You Can Solve This UPSC Mains Model Question:
Despite legislative recognition, social security remains inadequate for India’s unorganised and gig workers. Critically examine the challenges and suggest measures to ensure inclusive social protection. 10 Marks (GS3, Indian Economy)
Context
The Union Labour Ministry has constituted National Social Security Boards for unorganised and gig workers, nearly a year after the Social Security Code’s implementation. However, concerns over centralisation and inadequate stakeholder representation highlight the need to move beyond nominal coverage towards inclusive and accessible social protection.
Introduction
Social security is essential for ensuring dignity, economic security and social justice. However, India’s predominantly informal workforce continues to face significant protection gaps despite legislative reforms and expanding welfare coverage.
Understanding Social Security and Its Constitutional Significance
1. Meaning and Scope of Social Security
- ILO Definition: The International Labour Organization (ILO) defines social security as protection against risks such as sickness, unemployment, old age, maternity and employment-related injuries.
- Importance: Social security ensures income security, healthcare access and livelihood protection while promoting inclusive growth, reducing inequalities and strengthening vulnerable households.
2. Constitutional Foundations
- Article 21: The right to life with dignity provides a constitutional foundation for livelihood and human security.
- Article 38: Directs the State to promote social, economic and political justice and minimise inequalities.
- Article 39(a): Directs the State to ensure adequate means of livelihood for all citizens.
- Article 41: Provides for public assistance in cases of unemployment, old age, sickness and disablement, subject to the State’s economic capacity.
- Article 42: Ensures just and humane working conditions and maternity relief.
- Article 43: Promotes living wages and decent standards of life for workers.
- Article 47: Makes improvement of public health a primary responsibility of the State.
3. Federal Dimension of Labour Welfare
- Concurrent List: Entry 23 covers social security, social insurance, employment and unemployment, while Entry 24 deals with labour welfare and working conditions.
- Cooperative Federalism: Both Union and State Governments share legislative and administrative responsibilities in labour welfare, making Centre-State coordination essential for effective social security delivery.
Recent Developments and Significance of the News
1. Constitution of National Social Security Boards
- The Ministry of Labour and Employment constituted the National Social Security Boards for Unorganised Workers and Gig and Platform Workers on 30 October 2026 under the Code on Social Security, 2020.
- The Boards will advise the Union Government, recommend welfare schemes and monitor social security measures for India’s informal workforce.
2. Composition and Concerns Regarding Representation
- The Unorganised Workers’ Board has 40 members, while the Gig and Platform Workers’ Board has 22 members, representing workers, employers, aggregators and governments.
- Concerns persist regarding centralisation and inadequate stakeholder representation, particularly the limited participation of independent trade unions and Opposition-ruled States.
3. Significance of the Development
- Recognition of Informal Employment: The Boards provide an institutional mechanism to address the social security needs of workers outside conventional employer–employee relationships, particularly gig workers.
- Effective Implementation and Inclusive Growth: They can strengthen the implementation of labour reforms, promote Centre-State cooperation and improve income security and welfare coverage for vulnerable workers.
Major Challenges Associated with Social Security for Unorganised and Gig Workers
1. Institutional and Governance Challenges
- Centralisation and Inadequate Representation: Excessive Union Government control and limited representation of trade unions, worker associations and State Governments may weaken participatory governance.
- Weak Accountability and Coordination: The advisory nature of the Boards and differences in State-level administrative capacities may result in weak implementation and uneven delivery of welfare benefits.
2. Structural Challenges Affecting Unorganised Workers
- Employment Informality and Income Insecurity: Irregular employment and uncertain earnings among daily-wage workers, domestic workers and agricultural labourers make regular social security contributions difficult.
- Occupational Vulnerability and Weak Enforcement: Hazardous working conditions, lack of awareness and inadequate inspection mechanisms prevent workers from accessing insurance, healthcare and other statutory benefits.
3. Specific Challenges Affecting Gig and Platform Workers
- Ambiguous Employment Relationship: The absence of conventional employer–employee relationships creates uncertainty regarding aggregators’ responsibilities for providing social security.
- Algorithmic Exploitation and Income Insecurity: Algorithm-based work allocation, fluctuating earnings, opaque ratings and inadequate collective bargaining expose workers to economic and occupational vulnerabilities.
4. Gender and Social Vulnerability
- Gender-Based Exclusion: Women informal workers often lack maternity protection, healthcare and pensions, while unpaid care responsibilities further restrict their economic participation.
- Intersectional and Migrant Vulnerability: Dalits, Adivasis, persons with disabilities and migrant workers face multiple disadvantages due to social discrimination, geographical mobility and difficulties in accessing welfare benefits.
5. Fiscal and Technological Challenges
- Inadequate Financial Resources: Extending comprehensive social security to a vast informal workforce requires sustained government funding and predictable contributions from employers and aggregators.
- Digital Exclusion and Data Concerns: Limited digital literacy, fragmented databases and inadequate data protection may lead to exclusion, duplication and misuse of workers’ personal information.
Important Institutional Recommendations and Reports
1. National Commission for Enterprises in the Unorganised Sector (NCEUS)
Chairperson: Dr. Arjun K. Sengupta | Established: 2004
- The Commission recommended a comprehensive, rights-based social security framework covering health insurance, maternity benefits, life and disability insurance, provident fund and old-age pensions.
- It emphasised worker registration, unique identification and institutional delivery mechanisms to ensure social security as a worker’s entitlement rather than a welfare concession.
2. Justice V. Gopala Gowda Committee Report, 2026
- The committee highlighted anti-worker and anti-federal concerns in the four Labour Codes, particularly regarding workers’ rights, trade union functioning and State Government autonomy.
- It recommended stronger State-level legislative protection for unorganised workers, fair remuneration and welfare measures, balancing labour reforms with social justice.
3. International Labour Organization (ILO) Perspective
- The ILO advocates universal social protection through social insurance and social assistance, ensuring protection against major life-cycle risks.
- Its Social Protection Floor framework emphasises universal access to essential healthcare and basic income security, particularly for vulnerable sections.
Way Forward: Building an Inclusive and Decentralised Social Security Framework
1. Strengthen Cooperative Federalism: Ensure meaningful State Government representation in National Social Security Boards, strengthen decentralised institutions and involve trade unions, worker associations and civil society in decision-making.
2. Ensure Universal and Rights-Based Social Protection: Establish a universal social protection floor covering healthcare, maternity benefits, disability assistance, old-age pensions and livelihood security, moving beyond nominal registration towards adequate welfare entitlements.
3. Strengthen Gig Workers’ Protection: Clearly define aggregator responsibilities, ensure portable social security benefits across platforms and States, promote fair remuneration and provide transparent algorithmic management and collective bargaining rights.
4. Ensure Sustainable Financing: Strengthen the Social Security Fund through predictable contributions from Union and State Governments and aggregators, supported by progressive financing and periodic financial assessments.
5. Improve Delivery and Inclusivity: Integrate e-Shram with welfare databases, strengthen offline access, social audits and grievance redressal, while ensuring gender-responsive benefits and portable protection for migrant and other vulnerable workers.
Conclusion
India’s transition towards a welfare-oriented economy requires social security to become an enforceable and inclusive entitlement. Strengthening cooperative federalism, worker representation and financial accountability is essential to ensure that no worker is left unprotected.
| Important Current to Concept (CTC) from this Article for UPSC: Code on Social Security, 2020 International Labour Organization (ILO) |