The Karnataka High Court refused to stay the Karnataka Platform Based Gig Workers (Social Security and Welfare) Act, 2025, and directed app-based service providers including Eternal, Swiggy, Zepto, and Urban Company to deposit the welfare fee owed to the state government within three weeks, the court order showed. The ruling came on July 7, 2026, with the next hearing scheduled for August 14, 2026, according to medianama.com.
Justice M. Nagaprasanna emphasized that the welfare fee demanded is not a voluntary contribution but a statutory mandate under the state legislation, which is currently under constitutional scrutiny. The Internet and Mobile Association of India (IAMAI) and several gig platforms had challenged the Act’s validity, arguing it conflicts with the Central Code on Social Security, 2020, and thus violates Article 254 of the Constitution. Senior Advocate CK Nandakumar and Dhyan Chinappa represented the petitioners in court.
The Karnataka Act aims to provide social security and welfare benefits to gig workers operating within the state, marking a rare state-level intervention in the gig economy. The platforms’ challenge highlights ongoing tensions between state and central regulations governing gig workers, with the central Code on Social Security intended to provide a uniform framework. This case could set a precedent for how social security laws apply to gig platforms across India.
The court’s directive requires the platforms to deposit the welfare fee with the court registry within three weeks, while explicitly prohibiting any coercive action against them until the next hearing on August 14, 2026. This timeline establishes a clear compliance deadline amid ongoing legal review of the Act’s constitutional validity.