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Home services marketplace Urban Company faces heat from women workers over unfair work practices

Written by Moulishree Srivastava Published on     3 mins read

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The seven-year-old startup, which counts marquee investors like Tiger Global, Steadview Capital, Accel India, Elevation Capital, and Prosus Ventures as backers, became a unicorn earlier this year.

Over a hundred women working with Gurugram-headquartered home services marketplace Urban Company (UC) have protested against the high commission fees charged by the startup, low earnings, and poor safe working conditions.

These women—who work as partners in UC’s salon and spa vertical—said the company has hiked the commission to over 30%, which has substantially decreased their incomes. They further alleged that the company does not provide any insurance and assigns them to work at night. To oppose alleged unfair work practices, many of these women stopped taking orders from customers.

The development has once again brought to the fore the issue regarding the working conditions of gig workers in Indian startups. In the past few years, food delivery guys and cab drivers have raised concerns over low wages and insufficient employee benefits provided by major marketplaces like Zomato, Swiggy, Ola, and Uber.

UC provides home services such as home salon and spa, cleaning, and electronic equipment repairs, among others, across major cities in India as well as Dubai, Abu Dhabi, Sydney, and Singapore. Founded in late 2014 by Abhiraj Bhal, Varun Khaitan, and Raghav Chandra, UC currently has a partner network of over 25,000 service professionals ranging from beauticians and masseurs to sofa cleaners, carpenters, and technicians. These partners are not full-time employees and are free to work outside the platform.

The seven-year-old startup, which counts marquee investors like Tiger Global, Steadview Capital, Accel India, Elevation Capital, and Prosus Ventures as backers, became a unicorn earlier this year. The home-based personal grooming services segment has been a cash cow for UC. The beauty and wellness segment accounted for 55% of its revenues for the financial year ended March 2020.

Responding to the strike, the company swung into action and developed programs to increase its partners’ income.

“We are not perfect and acknowledge that we might have made mistakes in our journey so far,” the company said in a blog post on Sunday. “In the coming weeks, we will be announcing several important programs which, we believe, will further enhance the earnings and well-being of our partner ecosystem.”

“Under no circumstances will we ever shy away from doing the right thing for our stakeholders. This has always been reflected in our business decisions and strategy,” Urban Company said in its post.

To alleviate partners’ earnings concerns, the company said the service professionals, including women in the salon and spa vertical, earn a net average of INR 280–300 (USD 3.7–3.9) per hour, after taking out commissions, fees, and associated costs.

“Partners handling 30 orders or more per month (one order per day) earn approximately INR 28,000 (USD 372) per month, including all commissions and costs,” it said. The company added that service partners have access to life and accidental insurance cover.

In a statement, the Indian Federation of App-based Transport workers (IFAT), an industry body for app-based transport and delivery workers, said it “stands in solidarity with the women workers of Urban Company protesting against the exploitative practices of these app-based service companies.”

“The women workers have been trying to negotiate with the Urban Company management for the last three months, but there has been no acceptable outcome from the discussions,” IFAT added. “The demonstration in Gurugram happened because of apathy among Urban Company management regarding the issues and concerns of the workers.”

IFAT listed the demands by the protesting women partners, which included commission rates charged by UC to be capped at 20%, allowance of five emergency cancelations in a month without any penalty, and effective grievance redressal systems, among other things. Last month, IFAT filed a petition in the Supreme Court seeking Social Security benefits for gig workers associated with leading food delivery and cab aggregator companies.

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