The growing reliance on app-based mobility services such as Uber led the Ministry of Road Transport and Highways (“the Ministry”) to amend the Motor Vehicles Aggregator Guidelines. Most drivers on app-based mobility services are engaged as independent contractors rather than employees, while the platform operates as an intermediary connecting passengers with the drivers. As a result, drivers often fall outside the statutory protections available to employees and are often treated as falling within the broader category of gig workers.
The Ministry published the amended Guidelines in July 2025 (“the Guidelines”), which primarily affect passenger and driver safety, obligations imposed on drivers, employment opportunities and aggregators' operations. The Guidelines regulate the platforms as intermediaries rather than as employers, leaving the underlying gig worker classification unresolved. While the Guidelines improve user safety and generate employment opportunities for drivers, they fail to resolve concerns regarding driver protection and operational fairness. India's approach mirrors a broader global trend of regulating platform work indirectly through sectoral rules rather than comprehensive labor-law reform.
The Guidelines impose several duties on aggregators, including mandatory insurance coverage of Rs. 5 lakh per passenger, psychological and medical fitness requirements for drivers before onboarding, and a bar on onboarding vehicles older than eight years from date of first registration.
The Guidelines removed the earlier cap on drivers of working more than 12 hours, the precondition of at least two years of licensed driving experience and the obligation for aggregators to disclose the functioning of platform algorithms, the fare-sharing formula, and the incentives offered to drivers. Under the present Guidelines, aggregators are only required to share the fare structure on the app and official website. Compared to the earlier regime, the 2025 Guidelines relax entry barriers and disclosure duties while tightening vehicle-age limits and insurance requirements, signaling a regulatory shift from pre-emptive control toward post-entry safety monitoring.
Removing the cap on driving hours may expose drivers to excessive working hours. The Guidelines have also removed the mandatory driving test for prospective drivers. The earlier minimum requirement served as a filter, keeping inexperienced drivers off the road. While reducing the minimum experience requirement may expand livelihood opportunities, it remains necessary to ask whether the trade-off is justified if it compromises road safety. The driving test provided direct screening of drivers' practical skills and helped support road safety. Removing the driving test may enable smoother onboarding and allow market players to expand their fleets, potentially creating more job opportunities. At the same time, efficiency should not come at the cost of road user safety, especially in a context where licensing processes may be vulnerable to corruption and road aggression remains a persistent concern.
Although excluding disclosure of operational algorithms may protect commercial confidentiality, drivers still need information about incentives, bonuses, commission rate, passenger allocation practices to make an informed choice. The Guidelines are silent on the aspect of the platform- driver interaction, particularly fake user complaints, losing on rides due to technical glitch of the platform and deactivation protection. The Guidelines also omit any procedural safeguards for drivers, such as notice, hearing, or an appeal mechanism before deactivation or penalties are imposed, leaving them vulnerable to unilateral platform decisions, resulting in a power imbalance.
For instance, the Guidelines acknowledge dynamic pricing, cap fares at twice the base price, and list unjustified use of such pricing as a ground for suspending a license. However, the Guidelines do not address platform-led discounting strategies that may reduce driver earnings and distort the bargaining balance between platforms and drivers. Where discounting reduces the driver's share of the fare, it can impose significant financial strain on workers who depend on platform income. India's antitrust regulator, the Competition Commission of India, has not yet developed a fully consistent regulatory or quasi-judicial standard for addressing deep discounting on online platforms.
The Guidelines impose a blanket one-year waiting period before aggregators whose licences have been cancelled may reapply. A more comprehensive approach would have been to adopt a tiered system based on the nature of the breach. A blanket one-year waiting period may be unduly harsh where the breach is merely technical and is promptly remedied. In a growing industry with a diverse range of players, such a blanket rule, combined with a weak grievance and appellate mechanism, may operate as a significant deterrent.
Prescribing a maximum penalty of Rs. 1 crore for non-compliance is disproportionate for a sector that includes established players as well as new entrants. A more coherent approach would be to tie penalties to a percentage of profit or revenue. This would make fines more proportionate to the size of the offending entity and better aligned with the principle of regulatory proportionality. A useful analogy may be drawn from competition law, where penalties are often tied to turnover rather than imposed as flat sums.
The Ministry missed an opportunity to incentivize aggregators to on board female drivers while revising the Guidelines. A mandate requiring a minimum percentage of female drivers in the fleet could create meaningful livelihood opportunities for women in a field still dominated by men. Assigning female drivers to female passengers, especially during late-night trips, could improve women passengers' sense of safety on the platform.
Although the Guidelines are well intentioned, several amendments may create challenges for gig workers and new entrants navigating the digital economy. The limited scope of the Guidelines in only regulating the platforms and not their interactions with the drivers, leaves broader questions of worker protection largely unresolved. While the Guidelines form part of central regulation, their enforcement depends on state regulatory bodies. It remains to be seen whether state authorities have the capacity and institutional coordination needed to enforce the Guidelines effectively. Without dedicated inspection mechanisms, digital compliance audits, and a centralized grievance-redressal interface, state transport authorities may struggle to monitor onboarding standards, fare transparency, and insurance compliance in practice.
Author is an Advocate practicing at Delhi High Court and an Early Career Fellow with the Internet Society. Views are personal.