The draft Code on Social Security (Central) Rules were released vide Notification G.S.R. 713 (E) on 13th November 2020 by the Ministry of Labour and Employment. Apart from replacing nine Central rules, the draft rules also provide for the procedure to be followed in the self-registration process by gig workers, platform workers and unorganized workers. They also shed light on the manner in which aggregators carry out self-assessment of the contribution payable under Section-114(4) of the Code. While previous posts on this forum have discussed the need for and manner in which such steps may be taken, this post shall examine the provisions under the draft Rules to provide the reader with an understanding of their practical consequences.
Registration on Self-Declaration Basis
Chapter-VIII of the draft Central rules contains the provisions relating to social security for unorganized workers, gig workers and platform workers. They may be described as follows:-
Rule-50(1) relates to the procedure for registration on self-certification basis as provided under Section-113(2) of the Code. It provides that every eligible unorganized worker or any category/sub-category thereof shall submit the application form electronically, with AADHAR on self-declaration basis for registration to such authority on the specified portal of Central Government. On completion of registration, such worker shall be issued an acknowledgement bearing his Unique Registration Number.
The Central Government may provide facilities such as a mobile application or web portal to facilitate registration of unorganized workers on the specified portal. In order to avail the facility of self-registration, unorganized workers shall be required to establish their identity through an OTP, or any other procedure specified by the Central Government.
In addition to the above, the Government has made it mandatory for an unorganized worker to be registered on the specified portal for them to avail any benefits under the social security schemes framed under the Code. Similarly, unorganized workers are also required to update their particulars such as current address, current occupation, mobile number, skill or any other particulars specified by the appropriate Government. Failure to do the same may result in ineligibility with regards to availing benefits of social security schemes under the Code.
The rule also states that it shall be the responsibility of the State Government or Building Workers’ Welfare Board or any other such Board of the unorganized worker, employer of Building Workers or aggregators or the contractors or gig/platform workers to register such eligible workers with AADHAR who are not registered with ESIC or EPFO or portal specified by the Central Government.
Rule-50(2) provides for the registration procedure for gig workers and platform workers which states that every eligible gig or platform worker under Section-113 shall be required to be registered with AADHAR on self-certification basis in the form on the portal as specified by the Central Government.
Each aggregator is required to share, at intervals that are monthly or other periodicity in such form as specified, the details relating to their gig workers or platform workers electronically to generate Unique Registration Number or temporary registration number on the Portal. Once the number is issued, each gig/platform worker shall authenticate himself through AADHAR as per procedure specified. Aggregators shall link their database with the unique registration number issued to facilitate registration of gig and platform workers. The registration of the gig or platform worker shall be done in the same manner and procedure as prescribed for the registration of unorganized workers.
Self-Assessment of Contribution by Aggregators
Rule-51(3) prescribes the manner in which aggregators shall carry out self-assessment of contribution payable under Section-115(4) in Form-XX and pay provisional contribution as assessed in the designated account of the Social Security Fund for the preceding year, not later than 30th June of the current year in which the contribution is payable. Aggregators are also required to submit a final return in Form-XXI on the basis of finalized audited financial statements, detailing the provisional payment of contribution made along with the details of outstanding contribution.
In case an aggregator has paid excess contribution, he can claim a refund of such amount in Form-XXI. The designated authority shall scrutinize the form submitted by the aggregator and refund electronically any excess amount within a period not exceeding 90 days from the receipt of the claim. Aggregators are also required to register on the Shram Suvidha Portal, or any other portal as may be specified by the Central Government.
From the above it is clear that the Government wants to create a technology driven process for the registration and subsequent tracking of gig workers, platform workers and unorganized workers. The conditions for cessation of status as a gig or platform worker are met when such a worker attains the age of sixty years or when he is not engaged as a gig/platform worker, with any of the aggregators for a period less than ninety days in the preceding twelve months. This read with the nature and manner of contributions that have to be made by aggregators indicate that the social security being provided is more in the nature of a pension fund than a provident fund.
This is because aggregators are paying lump-sum contributions on the basis of audited financial statements for a set of workers who are engaged with multiple employers. There is a lack of specificity when it comes to payment of contributions, which hints at the framework being one that supports a pension fund scheme. Questions still remain how and whether these funds will be sufficient in providing for disability cover, accident insurance, health, and maternity benefits etc. It is possible that the monthly returns being provided by aggregators shall act as a sort of reference for the Central Government to create and streamline such schemes.
Thus, creating a link between the social security fund which seems to be a pension scheme for all practical purposes and the provision of other benefits is imperative for gig and platform workers to be adequately covered.
Do you believe the above scheme of self-certification and self-assessment is practically feasible? Is there scope for further reform when it comes to social security for gig and platform workers? Is the Government imposing excessive restraints on aggregators? Or do aggregators need to provide for more benefits when it comes to their workforce?
Drop your thoughts in the comments below.
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