The Karnataka High Court directed platform aggregators to deposit disputed welfare contributions under the Karnataka Platform-Based Gig Workers (Social Security and Welfare) Act, 2025 within three weeks, while hearing a constitutional challenge to the law. The interim order came earlier this week as the court refused to stay the legislation, which mandates a 1% welfare contribution from gig platforms, according to inc42.com.
The legal dispute began after Karnataka implemented the Act last year, establishing a Welfare Board and notifying the welfare contribution. Platform companies including Swiggy, Zepto, Urban Company, Meesho’s logistics arm Valmo, and the Internet and Mobile Association of India (IAMAI) challenged the Act and its rules in the High Court. The court’s recent order requires the disputed funds from the second quarter to be deposited with the court registry while the constitutional validity of the law is examined.
This case raises a significant question about whether states can enforce their own social security frameworks for gig workers before the central government operationalizes a national policy. The Karnataka Act is among the first state-level laws targeting social security for gig workers, marking a potential precedent for other states. The outcome could influence how gig economy companies comply with welfare contributions and shape the regulatory environment for platform-based workers in India.
The Karnataka High Court’s directive to deposit the welfare contributions within three weeks sets a concrete timeline for compliance amid ongoing legal proceedings. The case continues to unfold as the court examines the constitutional challenge to the Karnataka Platform-Based Gig Workers Act, 2025, with implications for the broader gig economy regulatory landscape.