Now, Uber Moves Karnataka HC Challenging State’s Gig Workers Law

Now, ride-hailing major Uber has moved the Karnataka High Court (HC), challenging the constitutional validity of the Karnataka Platform-Based Gig Workers (Social Security and Welfare) Act, 2025.

Justice Suraj Govindaraj yesterday issued notices to the Union government, Karnataka government and the Karnataka Platform-Based Gig Workers Welfare Board, seeking their responses by August 24.

The court also directed that Uber’s petition be tagged with the existing pleas challenging the law.

In an interim relief, the court extended to Uber the protection granted earlier to IAMAI, Eternal, Swiggy, Zepto, Urban Company and Meesho’s logistics arm Valmo Transportation.

The aforementioned companies had earlier moved the Karnataka HC to stay the gig workers law. The HC declined to stay the law but restrained the state from taking coercive action against the petitioners.

Uber will also have to comply with the same condition. Since the company filed its petition after the July 3 order, the court granted it three weeks from July 28 to make the deposit.

What Uber Has Challenged

According to a report by Bar and Bench, Uber has asked the HC to strike down the state’s gig workers law and the rules framed under it.

The ride-hailing company has also challenged the notification setting up the Karnataka Gig Workers Welfare Board and the notices issued to it.

At the heart of the challenge is the argument that Karnataka has created a second social security regime for gig workers alongside the Centre’s Code on Social Security, 2020.

Uber says the state law largely overlaps with the central framework while imposing additional financial and compliance obligations on platforms, creating a conflict between the two laws.

The company has also challenged the rules framed under the Act, arguing that they go beyond what the law itself provides and leave platforms unclear about whether they could face obligations under both the state and central regimes.

Karnataka’s Gig Workers Law

Karnataka notified its Platform-Based Gig Workers (Social Security and Welfare) Act in September 2025, setting up a welfare board and fund for gig workers, along with social security benefits and a grievance redressal mechanism.

At the centre of the dispute is the welfare fee imposed on such platform companies. In February 2026, the state fixed the contribution at 1% per transaction, subject to category-wise caps. 

Food and grocery delivery platforms have to pay up to ₹0.50 per transaction, while ride-hailing companies face caps of ₹0.50 for two-wheelers, ₹0.75 for three-wheelers and ₹1 for four-wheelers.

The money is meant to fund benefits including life and accident insurance, disability cover, medical assistance, maternity benefits and old-age protection for gig workers.

Platforms argue that Karnataka’s law creates another social security system even though the Centre already has the Code on Social Security, 2020. They are also worried about the cost. Even a small fee can add up when companies handle millions of transactions.

Another concern is that if other states introduce similar laws, platforms operating across India could end up dealing with different welfare fees and compliance rules in every state.

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