No detrimental long term impact of gig worker code, engaging with Govt: Eternal tells shareholders

Food delivery and quick-commerce platform Eternal said in a statement on Saturday that the financial impact of the new social security code, which took effect on Friday, will not hurt the company’s long-term prospects. The Deepinder Goyal-founded firm added that the exact financial and operational implications will be known only once the rules are formally notified, and that it is actively engaging with the government for clarity.

“To our shareholders – the exact financial and operational contours of CoSS will become clear only once the corresponding Rules are notified. We have been engaging with the Government over the years and providing inputs throughout this process, and we will continue to do so. We don’t think any financial impact on account of these Rules will be detrimental to long term health and sustainability of our business. We have been anticipating and planning for these social security related contributions in our businesses for a while now,” the company statement said.

Players like Eternal (Zomato, Blinkit) and Swiggy employ gig workers for their operations and the Code on Social Security, 2020 (CoSS) will have implications on their businesses.

In a landmark move, the government on Friday implemented the four Labour Codes, pending since 2020. The new rules aim to ensure worker-friendly practices that include timely minimum wage for all and universal social security, including gig and platform workers, while allowing longer work hours, broader fixed-term employment, and employer-friendly retrenchment rules.

The Code on Wages, 2019, the Industrial Relations Code, 2020, the Code on Social Security, 2020 and the Occupational Safety, Health and Working Conditions Code, 2020 were passed by Parliament five years back and have replaced 29 fragmented laws with a unified and modern framework.

Welcoming the move, the company said the consolidation of 29 central laws into four Labour Codes is a major systems reform and “we welcome the Government of India’s focus on simplifying and modernizing the labour framework. The consolidation of labour laws provides clearer, more uniform, and consistent rules, which supports both the country and our ecosystem.”.”A unified, nationwide framework brings much-needed uniformity for gig workers, and at the same time improves ease of doing business for platforms and is a step in the right direction. At Eternal, we are deeply committed to the wellbeing of gig workers and already provide a range ofcomprehensive insurance and welfare benefits, free of cost,” the company statement said.(Disclaimer: The recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times.)