Gender pay gap and occupational segregation have followed Indian women into gig economy

In 2016, after five years of working at a call centre in Mumbai, 32-year-old Pooja* decided it was time to start her own salon and earn money on her terms. Three years later, she was deep in debt and while struggling to get out of it, she started working as a spa therapist with the online platform Urban Company. Now, she does not want to leave the platform.

To run her salon, she had to pay the rent for the room, give salary to the staff and buy equipment, yet there was no guarantee of client footfall, said Pooja. “With the app, I do not have many of these expenses and I can earn more,” she added.

Urban Company, earlier called Urban Clap, is a mobile application-based platform that provides trained professionals for household, wellness and beauty services to customers at their homes. As of 2019, the company had nearly 20,000 service professionals, as per a June 2020 report by the Initiative for What Works to Advance Women and Girls in the Economy. Nearly 40% (8,000) of these professionals are women like Pooja.

Urban Company, Housejoy, Uber, Ola, Swiggy and many similar digital services that connect customers with service providers constitute India’s booming gig economy. India has the highest number of gig workers, with 24% of global online labour, per the Oxford Internet Institute’s Online Labour Index. And estimates show that the number of platform-based gig workers has increased from 8.5 million in 2016 to 11.7 million in 2017 and 15 million in 2018.

The Oxford English dictionary defines a gig economy as an economic system in which many short periods of work are available rather than permanent jobs. The gig economy can include all forms of short-period work such as freelancing – both online and offline – and providing services through online platforms. In this report, however, we focus only on the latter as issues vary across each group within the gig economy.

While the earning potential and flexible working hours have drawn women to these apps, persisting issues of occupational segregation, gender pay gaps and lack of social security benefits have followed them to these new online employment opportunities as well. And, even as the platform-based gig economy has helped increase women’s earnings and empowered them, it is largely an urban phenomenon.

New opportunities, old hurdles

Kavita* started working when she was just 12. For nearly nine years, she made imitation jewellery for up to nine hours a day for a monthly wage of Rs 2,000. Then, to pursue her interest and to earn more, she started working at a beauty salon for Rs 8,000 per month, before joining Urban Company. Before the pandemic, the 26-year-old earned Rs 30,000 to Rs 40,000 on average each month.

Like Kavita and Pooja, every single one of the 15 Urban Company service professionals that Initiative for What Works to Advance Women and Girls in the Economy convened for focus group discussions (eight women and seven men) agreed that their incomes had increased since joining the platform.

The women on the platform, on average, earn Rs 1,552 per day against the Rs 8,000 to Rs 10,000 per month at a routine salon job, found the June 2020 Initiative for What Works to Advance Women and Girls in the Economy study of 88 women from Mumbai and Delhi.

In addition to increased earnings, women also like flexible work timings as it allows them to manage their household and other unpaid care responsibilities. Almost 85% of the respondents in the Initiative for What Works to Advance Women and Girls in the Economy study were satisfied with the flexible timings. Most (56.8%) of the women took fewer than three calls a day, while only a few (1.1%) took more than five calls.

On average, the respondents worked for 37 hours a week. This also reflects that most of the respondents are bound by their unpaid work responsibilities and can dedicate only a part of their day to paid employment, said the report.

However, the concept of “flexibility” is not that straightforward in this context, said Zothan Mawii, a research fellow at Tandem Research, an interdisciplinary research collective. “As a worker, you also have to think about when there are high demand and the times that you get bookings. You may have to meet high targets set by the platform company that you would not really have the choice of flexible working hours.”

Socio-cultural limitations and gender stereotypes

The deep-seated issues of occupational segregation and gender pay gaps that are prevalent in traditional labour markets remain in the digital marketplace also. While no consolidated data exist on the number of women working as gig workers via various platforms, it is widely believed that female participation in these platforms is mostly concentrated in beauty and wellness services, cleaning or formalised care work.

The reasons for these range from safety and mobility issues to gender norms, and what are considered “appropriate” jobs for women, say experts.

“The nature of the labour market reflects a number of social norms,” said Balaji Parthasarathy, professor at the International Institute of Information Technology, Bangalore, and the lead investigator for Oxford Internet Institute’s Fairwork project. “Women have traditionally not gone to drive auto-rickshaws or cabs, whether it is through these platforms or otherwise. So, we cannot expect to see overnight a dramatic change in the composition of the workforce in a particular occupation.”

The inability of women to participate as much as men act as a further barrier. Many women can only work during the day or only in certain areas, which leads to lesser income compared to men, said Mawii. The platforms’ incentive structures and fixed hourly rates result in many women being unable to sustain themselves, and they end up leaving.

A survey conducted by the employment consultancy TeamLease in 2019 showed evidence of an 8% to 10% gap in earnings between men and women working for digital platforms in India.

But, there are signs of change. More women are being drawn into non-traditional forms of gig work in the transport and food-delivery sectors, said Saloni Atal, a doctoral researcher at the University of Cambridge and the author of a September 2020 study on women in the gig economy.

“My interviews with women gig workers suggest that this shift may be related to affirmative action being taken by companies such as Swiggy and Uber,” Atal told IndiaSpend. “One of my respondents, for example, said that her food-delivery platform does not require women to work during late hours. Such measures are a pull factor for women.”

Digital market: divide greater than dividends

Gig work is largely an urban phenomenon with 82% of respondents in the Initiative for What Works to Advance Women and Girls in the Economy study being urban residents and non-migrants. Limited access to digital services also acts as an impediment for women to participate in the gig economy.

Most platforms require women to own smartphones and have access to mobile internet. Ridesharing and delivery platforms may also require the workers to own assets such as bikes or taxis. Only 21% of Indian women use mobile internet and women are 20% less likely than men to own mobile phones and other assets due to socio-cultural restrictions.

To address this problem, some platforms offer their own devices, but this is only a stop-gap solution and the imperatives are digital education, skills training and the removal of barriers of accessibility, stated a May 2020 brief by Observer Research Foundation.

In 2019, the number of women in platform-based jobs increased by 70% from 40,000 in 2018 to 67,900. In five years to 2016, over 270 platforms have cropped up for home-based service work such as cleaning, cooking and beauty services. While these platforms have grown, the share of urban women in self-employment and casual labour dropped between 2011-’12 and 2017-’18, as reported by the Periodic Labour Force Survey, 2017-’18.

In 2011-’12, an equal proportion (42.8%) women were estimated to be self-employed and salaried. In 2017-’18, the share of salaried women increased to 52.1%, while that of self-employed women dropped to 34.7%. In the same period, the proportion of women in casual labour dropped from 14.3% to 13.1%.

India has one of the lowest female workforce participation rates and the Covid-19 pandemic has made it worse. The labour force has shrunk 2% for men but 13% for women over the previous year, November 2020 data from the Centre for Monitoring Indian Economy show, IndiaSpend reported.

Total employment in India for November 2020 was 2.4% lower than in November 2019, but among urban women, it was down by 22.83%, according to economist Mitali Nikore’s calculations, also using CMIE data, our report further stated.

The pandemic and looming uncertainty

The Covid-19 pandemic-induced lockdown and the resultant economic slowdown has led to millions of salaried employees losing their jobs. While employment recovered in the months of July, August and September after the initial shock in April due to the lockdown, the trends are reversing with a 600,000 drop in employed persons in October and 3.5 million in November.

Half of the gig workers lost their jobs and the other half had lost up to two-thirds of their income. From more than half of the gig workers earning more than Rs 25,000 per month in March, nearly 87% were earning less than Rs 15,000 in August, found a September 2020 study of 770 gig workers by Flourish, a venture firm.

Women workers were disproportionately affected as several services such as care work, domestic work and beauty and spa services were completely shut. Women workers reported being unable to work either because platforms had suspended their services or because they had to remain at home to take care of their families, a September 2020 report by Fairwork found.

A higher percentage (74%) of women than men (65%) were earning less than Rs 10,000 in August, found the report by Flourish. More than a third (34%) of women saw an increase in the number of dependents against 27% men.

Of the 13 platforms in India included in the report, only three (Amazon, Grofers and Flipkart) provided workers with pay loss compensation and only two (Uber and Ola) provided financial deferral of loan and other rental costs.

While beauty, care work and domestic work services were shut, women working as delivery persons had to choose between safety and financial ruin, found the Tandem Research study.

Both Pooja and Kavita did not find any work between April and August as spa services were mandated to remain shut. Although they have restarted work, their earnings remain limited. Pooja said that Urban Company has provided workers with Rs 5,000 as a loan during the pandemic and decreased the minimum amount that workers need to keep in their accounts from Rs 2,000 to Rs 1,000.

Urban Company also provided workers with a clear policy on health insurance or health savings schemes – workers qualified based on the number of calls attended per month – per the Fairwork report. No platform in India provided a death-in-service payment for the workers’ families, it said, though, of the 11 platforms studied, seven offered accident insurance and only one, Urban Company, provided health insurance.

Women workers also reported having to combine child care with care work or domestic work, including taking their children with them to workplaces – exposing both themselves and their children to the risk of contracting the virus.

The pressure and ramifications of ratings

“Sometimes clients ask us to do tasks that are not relevant to our job,” said Kavita. “If there is a baby crying in the house, they would ask us to soothe her for a while. Though it is not our job, we cannot say ‘no’ outright. We have to be tactful about it as our ratings depend on customers.”

Some customers also ask for more than the booked services, said Pooja. “They would ask for a free head massage after the body massage. But if we refuse, they may give us low ratings. Sometimes we just have to adjust and make a loss for ourselves. To ensure ratings remain high, we have to do more than 100% mehnat.”

With less control over the kind of customers they can choose, female service professionals are also vulnerable to abuse, such as men impersonating as women, said Parthasarathy of Fairwork. “Sometimes the workers are asked to do extra chores that were not agreed on earlier. Because the workers rely on the customer ratings, they acquiesce to it.”

For 60% of the respondents interviewed in the Initiative for What Works to Advance Women and Girls in the Economy study, gig work is the primary source of income and they are the main earning member of the family. Since they cannot afford to lose this income and fear low ratings, women shy away from the often lengthy dispute resolution procedures, the ORF study found.

Urban Company service professionals have to maintain a rating of 4.5. If it drops lower than 4.5, they are taken off the platform and are reinstated after retraining. The professionals are given two chances for retraining. But professionals can complain against customers in cases of inappropriate behaviour by telephoning a helpline, the Fairwork report noted and some of the workers confirmed to IndiaSpend.

Among 11 platforms, Urban Company was ranked the highest in terms of a fair working environment by Fairwork in an analysis released in December 2020. The analysis rates platforms based on five principles – pay, conditions, contracts, management and representation. Urban Company fully complied with three (pay, conditions and management) and partially complied with the remaining two.

While four platforms in India manage to pay the workers more than the minimum wage and costs, there was not enough evidence that workers with three platforms (Bigbasket, Housejoy and Swiggy) earned the minimum wage before costs, found the Fairwork report.

None of the platforms fully complied with fair contracts and fair representation principles. While Urban Company and Dunzo had contracts that were readable, comprehensible and accessible to workers, they did not reflect the nature of the employment relationship.

Only Flipkart and Urban Company have “worker voice mechanisms” – such as meetings where small groups of workers speak with management about their grievances – and freedom of association. No platform recognised or was willing to recognise worker trade unions and none showed an interest in acknowledging or encouraging collectivisation of workers that could enable collective representation and bargaining, the report found.

Not being employees also alienates women – and men – since there are no job contracts, from other securities. Female gig workers are not provided protection under the Sexual Harassment of Women at Workplace Act 2013. They are also not entitled to other social security benefits such as maternity benefits and sick leave.

Of the five platforms (Urban Company, QuickrEasy, Helpers4U, Helpr and BookMyBai) studied in the ORF report, only Urban Company provides a safety procedure for workers who visit the client’s house for their service. However, there is no option for the workers to stop the service midway and not face negative consequences.

“We have been instructed to speak to the customers before we leave for their house to ensure our safety,” said Pooja. “If a male customer has booked the service then we have to speak to the woman who he has booked it for. If we find that he has booked it for himself, we can cancel the service. We have that provision.”

For a securer gig economy

On September 23, 2020, parliament passed the Code on Social Security 2020, which states that the central government will register gig workers and set up a social security fund for them. Experts agree that the government should create policies to regulate the gig economy.

“Gig platform workers should be given some sort of compensation with the platform people setting aside some amount from their turnover. So let us see how that helps,” Soumya Kapoor Mehta, head of Initiative for What Works to Advance Women and Girls in the Economy, told IndiaSpend in an interview.

“Gig work has always been around in our country [electricians, plumbers, domestic help, etc who create a customer base through word of mouth in an area] even before the days of the platforms,” said Parthasarathy. “But now there is this relationship with these organisations that is digitally mediated, therefore government regulation is necessary.”

In the aftermath of the Covid-19 pandemic, many industries are switching to the gig economy model, making these policies more important, said Mawii.

Another possible solution might be a “platform of platforms”, said Ria Kasliwal, junior research fellow and author of the ORF study, which would be a body with legislative backing that could not only establish a standard set of guidelines for the platforms but also monitor the platforms.

*Names changed to protect identities

This article first appeared on IndiaSpend, a data-driven and public-interest journalism non-profit.