The Internet and Mobile Association of India (IAMAI) and several aggregator platforms have approached the Karnataka High Court challenging the constitutional validity of the Karnataka Platform-Based Gig Workers (Social Security and Welfare) Act, 2025, and the rules framed under it.
The petitions come after the state government did not respond to IAMAI’s request to defer the levy of the gig workers’ welfare fee until the Centre and the state evolve a mechanism to offset contributions under their respective laws, and notify specific welfare schemes for gig workers.
Under the Karnataka Act, ecommerce operators must contribute 1% of their commission, subject to a cap, towards a welfare fund for gig workers. The state is home to several app-based platforms, including Amazon, Zomato, Uber, Ola, Meesho, Porter, and Blinkit, which collectively engage thousands of gig workers.
The writ petition, filed by IAMAI along with Eternal, Zepto, Swiggy, Urban Company, and Valmo Transportation, seeks to quash notices issued by the competent authority directing platforms to comply with statutory obligations, including constituting Internal Dispute Resolution Committees (IDRCs) and remitting welfare fees.
The High Court is yet to hear the matter.
The petitioners argued that the state legislation is inconsistent with the Code on Social Security (COSS), 2020, enacted by parliament to create a uniform national framework for social security covering all worker categories, including gig and platform workers.
IAMAI said the central law already requires aggregators to contribute between 1% and 2% of their annual turnover towards gig workers’ social security. In contrast, the Karnataka law mandates a welfare fee of 1%.
While the state law provides that contributions made under it would be adjusted against obligations per the central legislation, the association argued that the mechanism for such adjustments has not been notified. In the absence of reconciliation guidelines, aggregators could face duplicate financial obligations, it said.
The challenge also covers welfare fee notices issued on June 22, directing aggregators to remit welfare contributions under Section 20 of the Act and submit proof of payment, along with prescribed returns, by July 5.
The Karnataka government has capped the levy at 50 paise, 75 paise and Re 1 per transaction, depending on the platform’s business model, to limit the burden on smaller operators. The state expects to mobilise between Rs 250 crore and Rs 300 crore annually through this.
In its earlier representation to the government, IAMAI highlighted several operational issues that, it said, needed to be addressed before contributions to the Karnataka Gig Workers’ Social Security and Welfare Fund commenced.
The fund is administered by a 16-member Gig Workers Welfare Board headed by the state labour minister. Karnataka was among the first states to enact dedicated legislation for gig workers, a move backed by Congress leader Rahul Gandhi.
The state estimates that nearly five lakh gig workers are engaged with platform-based services, including around 2.75 lakh in Bengaluru alone across ride-hailing, ecommerce, and food delivery businesses.
