From algorithms to exploitation: New report exposes plight of India's gig workers

By Rajiv Shah 

The recent report, "State of Finance in India Report 2024-25," released by a coalition including the Centre for Financial Accountability, Focus on the Global South, and other organizations, paints a stark picture of India's burgeoning digital economy, particularly highlighting the exploitation faced by gig workers on platform-based services. 

This comprehensive analysis, prepared around the time of the recent nationwide strikes by gig workers across India—including major protests on December 25 and an escalated action on December 31, 2025, involving delivery personnel from platforms like Zomato, Swiggy, Blinkit, Zepto, and others demanding fair wages, an end to unsafe 10-minute delivery models, social security, and protection from arbitrary algorithmic deactivations—underscores the timeliness of its critique. 

Edited by prominent economists like C.P. Chandrashekhar and Jayati Ghosh, the report delves into how digital infrastructure has reshaped labor markets, often at the expense of workers' rights and wellbeing. 

Drawing on contributions from experts such as Rakshita Swamy, Khush Vachhrajani, Sabina Dewan, and Anuradha Ganapathy, it underscores the precarity of gig work, where platforms like Uber, Ola, Zomato, and Urban Company prioritize profitability over fair treatment, leaving millions vulnerable to low pay, hazardous conditions, and algorithmic manipulation. 

The document argues that this system exacerbates existing inequalities, with female gig workers facing particular neglect, trapped in low-value roles without adequate protections or pathways to economic mobility.

The report describes gig work as a hallmark of the digital age, where platforms mediate services like ride-hailing and food delivery, but classify workers as "independent contractors" rather than employees, denying them basic entitlements. 

As Sabina Dewan notes in her chapter "Capital and Labor in the Digital Age: The Rise of Digital Labour Platforms," this model is symptomatic of "hyper-financialization," where venture capital fuels platforms that prioritize rapid market dominance over worker welfare. Investors gamble on high failure rates—90 to 95 percent of tech startups collapse within five years—yet pour funds into survivors like Zomato, which reported 326,000 active delivery workers in FY 2022-2023 but paid out only about 33 percent of its Rs. 86.9 billion adjusted revenue as "delivery and related charges," translating to roughly Rs. 26 per hour for workers after long shifts, far below dignified wages. 

Dewan explains that platforms engage workers as "self-employed" to evade labor regulations, forcing them to bear costs like insurance and vehicle maintenance themselves, while algorithms optimize for profits, often embedding biases that exacerbate discrimination.

Exploitation is rife, with workers exposed to relentless pressures that erode their health and security. In "Exploring the policy-gaps concerning (platform-based) gig-workers and their precarity," Swamy and Vachhrajani detail how gig workers endure low pay below statutory minimums, hazardous pollution and weather exposure, and a lack of rest facilities. They quote workers facing "mindless 'customer is god' syndrome," where ratings dictate earnings, leading to irrational demands like high-floor deliveries under threat of poor reviews. 

Algorithms intensify this, through gamification—badges tied to targets that determine incentives and insurance—atomizing workers to prevent collective identity, and blocking IDs without notice for dissent or underperformance, violating natural justice principles. 

The authors highlight "wage theft" via algorithms that withhold work near incentive thresholds, and data misuse against workers, such as tracking locations to suppress protests. Without social protection, workers bear occupational hazards alone; the report notes no aggregator heatwave policy despite extreme conditions causing phone malfunctions and health risks during peak hours.

Female gig workers suffer compounded neglect, as the digital economy fails to address gender-specific barriers. Anuradha Ganapathy's "Critical evaluation of women's participation in e-commerce" reveals women's 21 percent participation rate on online platforms, the lowest globally per ILO data, with them concentrated in "highly feminized, often low paying sectors such as beauty work and domestic work." 

Despite claims of flexibility, platforms perpetuate precarities: women engage in repetitive, low-value tasks, unpaid labor, and punitive algorithmic regimes without living wages or childcare support. 

Ganapathy cites GSMA data showing women's mobile internet adoption stalled at 30 percent, limiting productive uses and translating to lower online work rates. On marketplaces, women sellers are "locked into unproductive cycles" of paid promotions without guaranteed visibility or sales, unable to compete with big enterprises. The report ties this to broader structural failures, where digital work doesn't enable mobility but reinforces informal market vulnerabilities, with less than 10 percent of India's 7 million gig workforce being women, per NITI Aayog estimates.

The document critiques policy gaps, noting the Code on Social Security 2020's charitable approach, excluding gig workers from traditional labor rights by deeming them "outside the traditional employer-employee relationship." It praises state-level progress, like Rajasthan's 2023 law mandating tripartite boards, welfare cess on transactions (1-2 percent), auto-registration, and grievance redress, holding governments accountable for the first time. 

Drafts in Karnataka and Jharkhand extend to fair contracts, transparency in algorithms, and income security. Yet, federal inaction persists, with G20 commitments on social protection and data monitoring unfulfilled. Dewan calls for comprehensive legislation addressing classification, algorithmic governance, remuneration, and collective bargaining, while Swamy and Vachhrajani urge repurposing technology for worker rights, like auto-registration shifting proof burdens to employers.

Overall, the report warns that unchecked platform growth, fueled by oligopolistic telecom like Reliance Jio, risks deepening divides in India's digital footprint. As Chandrasekhar and Ghosh introduce, digitization promises productivity but intensifies inequalities, with gig workers—especially women—bearing the brunt through exploitation and neglect. 

Without reforms prioritizing labor over capital, the digital economy could undermine inclusive growth, urging stakeholders to rethink how technology serves people over profits.