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Karnataka: Angry Urban Company Workers Plan Nationwide Protests

The company has been accused of unethical practices, including the termination of a female employee who worked while eight months pregnant.
Karnataka: Furious Urban Company Workers Plan Nationwide Protests

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The workers of the urban company, an app-based service delivery platform, attended a meeting in Bengaluru with a view to holding massive protests against the company in multiple cities. The main issue raised by the workers includes the blocking of IDs, which prevents them from getting leads and new customers. Effectively, it is equivalent to being sacked.

The workers are called 'partners' and are not paid salaries. The company takes a commission out of the various services rendered by partners who work in roles like carpentry, plumbing, electrician, beautician and salon services, among others. The meeting was held on Thursday, and the workers have planned a nationwide protest on July 12.

Most of the attendees were women from the beautician and salon services vertical. The range of doorstep services that they provide includes massages, facials, manicures, pedicures, waxing and hair care.

The workers start receiving leads on their phones from 7 am to 7 pm. They are expected to have a rating of five stars. If their rating drops below 4.6, their IDs are at risk of being blocked, preventing them from receiving new leads and effectively terminating them. They are also expected to maintain a response rate above 70%. This refers to the rate at which they accept new jobs/orders. If they fall below 70%, they risk being blocked.

Accusations of Price Gouging

What makes the company policy even more confusing is that they collect a fee of nearly Rs 40,000 from every female worker joining the beautician and salon services vertical. This fee is meant to cover beauty product kits which the company supplies. However, the workers allege that the retail value of these products is much less than what they pay for them. They must purchase all cosmetic products directly from Urban Company at inflated prices, higher than the Maximum Retail Price.

For example, the beautician partners said they were made to purchase a third-party facial kit from Urban Company for Rs 550, while the same kit costs about Rs 350 in the local market.

All beautician partners say that the company products are sold at inflated prices. Some partners feel that this policy can be continued with reduced prices because it helps maintain a standard of service delivery across locations.

Rekha (name changed), 26, a worker who has been with the company since 2016, says that the company has several issues, but they can be rectified if they start listening to workers' grievances.

"Many partners have stopped buying products from the company and are purchasing them directly from the market. I told them to maintain a ratio of 60:40 so that the company does not get suspicious. The company also wants to maintain a standard, so we should accept the policy. Some products are cheaper in the market, but some pedicure and facial products are in-house brands. They are not available elsewhere."

Since the company is striking deals with cosmetic companies for the wholesale supply of cosmetics, the cost benefits could be passed on to the partners. The customer could bear the cost of these products. However, that is not the case. This reduces the share of the worker's earnings.

Imagine walking into a movie theatre and finding out that the workers at the snack stall are being forced to buy potatoes, bread and chicken from the theatre company and then having to make and sell the products to the movie-goers. One does not arrive at a 2.8 billion USD valuation by doing business the old-fashioned way. It's a brave new world.

Commission, Subscription Fees and Credits

The company has instituted a 'subscription fee' on the partners. This is a monthly recurring fee that the partners pay to stay on the platform. While employees expect to receive a monthly salary, UC partners give their earnings to the company. The subscription fees may differ from one segment to another. Some partners admitted to paying Rs 1600/month while others paid Rs 2600/month. This is a form of rent which the partners are paying to keep using the platform.

Along with this, the company expects the workers to purchase credits to receive new leads and customers. One credit is worth Rs 10, and the partners must ensure that they keep purchasing credits because if it goes down to 0, they will not get customers. Partners alleged that the credits are deducted when they receive new orders/jobs. When the customer makes a payment, Urban Company retains a commission of 20%. However, the commission rate is not fixed and varies across categories and services.

A UC partner shared the earnings report on her app. While she earned around Rs 46,500 in the given month, the company had cut Rs 10,500 in commissions, leaving her with a net earning of around Rs 36,000. However, this amount does not include the cost of the cosmetic kits she purchased. That, along with travel and miscellaneous costs, brings her earnings to around Rs 25,000 for the month.

Hema, 36 (name changed), says that the company keeps introducing new rules, which may be arbitrarily changed again. She has been with the company since 2016 and is a single mother with two daughters. She works as a beautician.

"Last December, I attended a Zoom call where we were given targets. They said that the commission fees would be waived if we completed 40 jobs in a month. Despite heavy rainfall due to the cyclone, I rode my bike in the rain to complete 41 jobs. One night I met with an accident and my knees were injured. But the commission was not waived for the month. When I visited the office to enquire, they said that I was misguided by someone. They said that according to the rules, the subscription fees for the month would be waived if I completed 33 jobs in 22 days."

Single Mothers

Many of the partners who turned up at the meeting were single mothers. Most of the women were also the sole breadwinners of their families. The draw towards gig work was the flexibility promised by the company. At the salons where they used to work, they didn't have time to pick up and drop children at school. However, the partners at UC have too many stringent rules to follow, which restricts their options. They also don't receive any documentation from the company identifying them as UC workers. This restricts their ability to get bank loans.

A worker, Puja, 28 (name changed), joined UC in February 2023 as a beautician. Her ID was blocked multiple times because she had a rating of 4.2/5. After managing to get it unblocked, she resumed work. However, she was permanently blocked in June. The money she paid for the kits would also not be refunded.

"I was working in a salon earning Rs 23,000/month, and I decided to join this company because I was promised flexibility. I am a single mother with a five-year-old son. I also have to pay house rent and EMI payments on my bike. However, my ID is blocked, and I am not receiving new appointments. In the first month of the job, I paid Rs 2400 for the first kit. Then they asked me to pay Rs 9500 for the second kit. The third kit was for Rs 26500. However, I only worked for two months. I was blocked because my rating and response rate had come down. I visited the office and showed them documents and told them that I couldn't work because I had met with an accident. I also needed flexibility in my job because I had to pick up and drop my son from school. After requesting them, I managed to get my ID unblocked. My rating was at 4.2, and I could bring it up to 4.6. However, the rating stopped rising after that."

Extra Services Demanded by Customers

Many beautician partners who spoke to NewsClick complained that customers inevitably demand more services than they paid for. Sometimes, they may ask for longer massages or other beauty treatments. They may also demand that they perform massages for other family members. If they refuse, the customers may start quarrelling with them and complain that they are unhappy with the service. They are also likely to leave poor ratings in such cases.

While the customers demand extra services for free from the workers, the customers frown and are reluctant to allow the partners to use the toilets.

The Workers Organise

The UC partners rarely get to meet their co-workers. On Thursday, UC partners held a meeting in Bengaluru to discuss the issues faced by them. The meeting was led by long-term UC workers who were fed up with the working conditions. While the discussions were led by workers, members of the All India Gig Workers Union (affiliated with CITU) were present at the meeting. Local political leaders were also present and promised to join the workers in their fight and provide legal help when required.

This occasion was a scene of camaraderie where workers across job roles exchanged grievances and bonded with each other. The conversations ranged from monthly earnings to workplace accidents and injuries. It was a moment of solidarity where workers from different regions, speaking different tongues, could find common ground. A committee was formed to hold regular meetings and chart the future course of action. A nationwide protest has been planned for July 12.

The main issue raised by the partners was the arbitrary blocking and the dreaded rating system, which was taking a toll on their mental health. Other issues raised include the non-availability of Kannada speakers on the helpline number, opaque managerial structure, arbitrary allotment of 'hubs', low net earnings, and absence of safety measures. The beautician partners also demanded that the cost of cosmetic products be reduced. They repeated multiple times that they didn't intend to shut down the company, which is providing them with work and livelihood. However, they want the rating system to be dismantled because it was wreaking havoc on the mental health of workers from the poorer sections of society.

A female worker from the salon service category testified at the meeting that she was forced to work even while eight months pregnant because she feared that if her response rate dropped, she could be terminated from the job. She took only one month of rest after delivering her child, and when she returned to work, she couldn't take up the same number of jobs that she could before pregnancy. She found that her ID was blocked as a result. Finding herself in a desperate situation and having a baby to feed, she visited the company office hoping to request "one last chance". However, she found to her horror, that a female category manager insulted and humiliated her in front of a large group of employees and asked her to return after three years if she still wanted to work for the company.

The workers in Bengaluru had organised a spontaneous demonstration on June 19 to protest against the rating system and demanded the reinstatement of all blocked workers. However, the company has not accepted these demands.

The company has operations in at least 63 locations, including 54 cities in India, per its website.

In an emailed statement, an Urban Company spokesperson addressed the ongoing issues.

"As a company focused on quality and customer experience, it is our responsibility to ensure that both sides of the marketplace have a good experience. Our investments in training (which is free of cost and not paid for by partners), technology, tooling, products, free life, accidental and health insurance etc., go a long way in having a controlled experience on the marketplace, enabling service partners to deliver best-in-class quality and earn a decent, middle-class livelihood. We had recently asked a few partners who were not meeting the marketplace standards, despite multiple prior notices and re-trainings, to part ways with the marketplace. We continue to maintain an open-door policy and encourage dialogue with our partners. We remain committed to building a safe, high-quality home services platform."

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