Urban Company IPO leaves gig workers fearing tougher conditions

• Online services platform trades on exchange
• Workers say left in the dark about IPO
• Union encourages workers to buy shares for leverage

NEW DELHI - As India's online services platform Urban Company celebrated its stock market debut last week, gig workers - many of whom had staged protests in the run-up to the firm going public - worried they may be squeezed harder to please investors.

Shares of Urban Company, which offers at-home services from facials to plumbing repairs, jumped 74% last Wednesday, notching a valuation of nearly $3 billion as investors bet on its dominant position in a mostly untapped market.

But a dozen workers told Context they feared that the initial public offering, plans for which they said Urban Company had not informed them of, would translate into more exploitative working conditions.

"We face so many challenges already - poor pay, high commissions, long distances, rude clients ... and now things will get worse," said Daisy, a single mother of two children who requested to go by only her first name, fearing reprisal.

"We are their backbone, but they prioritise profits over our welfare," said the 34-year-old masseuse, lugging a massage table while exiting a residential complex in the city of Noida on the outskirts of New Delhi.

Urban Company did not respond to repeated requests for comment on whether it had directly informed their "service professionals" about the IPO in advance and if it would lead to any changes for workers.

When Urban Company started in 2014, it emerged as a source of hope for Indians, especially women, who wanted to gain economic independence on their own terms and in their own time.

But as the years have passed, workers say the company has stripped away flexibility and autonomy.

Urban Company classifies workers as "independent contractors," rather than employees, to avoid extra costs like pension plans and licensing fees, according to its IPO prospectus.

The company warned that formal employee status could lead to unionisation, higher costs, operational restrictions and increased liabilities.

Labour unions have long demanded platforms recognise gig workers as employees and provide benefits, including collective bargaining.

India's Code on Social Security of 2020 includes provisions to extend the scheme to gig and platform workers, whose numbers are expected to reach more than 23 million by the end of the decade. But the legislation has yet to be implemented.

Many hats

Concerns have also grown around the opaque nature of Urban Company's algorithms that can result in random job assignments and ratings and account deactivation.

For example, if clients rate them poorly and their score drops, workers risk being blocked from the app temporarily or permanently, if their performance does not improve.

Missed work means no income, a blow to workers who are single mothers or sole breadwinners.

"They take advantage of us, our vulnerability," said Deepa, a Hyderabad-based Urban Company beautician and single mother who has been trying to pay off a loan of 2.5 million rupees ($28,370) since joining the app in 2016.

"I have been loyal to (Urban Company), but instead of rewards (such as bonuses), I'm given more things to do," said the 40-year-old, who also requested her first name be used.

Eleven other workers also said they often have to act as recruiters and salespeople for Urban Company, in addition to their main services.

They said they are encouraged to convince people to join Urban Company's army of more than 48,000 workers and sell a range of goods to customers - from beauty and cleaning products to the platform's brand of water purifiers.

The company has also said it wants to expand instant deliveries.

"For them, the game isn't to remunerate professionals and build their skills or give dignified employment. Their thing is: you sell stuff," said Rikta Krishnaswamy, vice president of the newly formed Rajdhani App Workers Union, a subsidiary of the Centre of Indian Trade Unions that has 6.6 million members.

Urban Company says it provides workers with in-house training and access to tools and consumer goods.

They also offer insurance cover, loans, scholarships for workers' children and support to domestic violence victims.

"We believe we have helped them improve their earning potential while enabling them to maintain flexibility," said the prospectus, adding Urban Company workers on average earned 30% to 40% more than their peers who were not on any app in 2024.

Leverage

Aakash Singh, an Urban Company washing machine repairman, said he hoped investor scrutiny would prompt the firm to improve working conditions.

But Bengaluru-based labour economist Rosa Abraham said there was a lack of evidence of worker welfare improving after an IPO.

She pointed to Uber and Indian food and grocery delivery firm Swiggy, whose drivers have protested over poor pay and working conditions after public listings in 2019 and 2024.

Workers say the company, which has few competitors, is tantamount to a monopoly, and that without government regulation, they will continue to feel trapped by the app.

While India has no national law protecting gig workers' rights, many states are in various stages of discussion or implementation of legislation.

Rajasthan state in 2023 passed a bill to impose a surcharge on online transactions via platforms like Amazon and Urban Company to fund welfare benefits for gig workers, the first such scheme in the country.

Bihar and Karnataka passed laws this year covering worker registration, contract transparency and grievance mechanisms.

Before Urban Company's IPO, the New Delhi-based Gig & Platform Service Workers Union (GIPSWU) unsuccessfully demanded the firm offer shares at discounted prices to workers.

"The company can say it's not possible, because this isn't traditional employment. But an IPO means they will make a lot of money, which will not go to the workers who power the profits," said Anousha, a volunteer at GIPSWU who goes by one name.

"If workers together buy some shares, partner with other conscious, ethical investors, then they have the ability to bring resolutions to a vote during annual shareholders' meetings and try to influence company policy," she said.

($1 = 88.1225 Indian rupees)

(Reporting by Annie Banerji; Editing by Amruta Byatnal and Ayla Jean Yackley.)