Is Urban Company heading the Ola, Uber way with over 100 beauticians taking to the street?

• Over 100 female beauticians took to the street, protesting against the pay scale, working conditions and lack of insurance at Urban Company.
• Ten months ago, the Fairwork India Ratings 2020 Report, which judges several digital companies based on their treatment of gig workers, rated Urban Company with a score of 8 on 10.
• Urban Company’s co-founder Varun Khaitan assured that they have learnt several lessons from other companies and plan to scale their business sustainably, without eating into the earnings of these partners.

Home services aggregator Urban Company was among the top rated digital businesses to offer better amenities and working conditions to the gig workers that have been associated with them.

So it was bound to be a shocker when over 100 female beauticians took to the street, protesting against the pay scale, working conditions and lack of insurance at Urban Company, which has been riding on a high horse based on these factors for a while now.

Only ten months ago, the Fairwork India Ratings 2020 Report — which judges several digital companies like Flipkart, Uber, Ola, Zomato and Swiggy based on their treatment of gig workers — rated Urban Company with a score of 8 on 10. This rating was based on several factors including fair pay, conditions, contract, management, representations and more.

So, the question naturally arises — What went wrong in these 10 months?

While the women protested against the Urban Company outside their office in Gurgaon, Urban Company shared a detailed statement highlighting each and every aspect of their business as per the complaints raised by these women.

You can read Urban Company’s detailed statement here.

Perhaps, there is a much larger picture that is getting missed.

Talk about new age digital firms like a Zomato or a Swiggy, an Uber or an Ola, all these companies have one major thing in common — all of them started off with extensive offerings for these gig workers.

From better pay to flexible working hours, from insurance to incentives — you name it and the list was full of it. But as these platforms scaled up and the role of gig workers increased further, their importance, however, decreased. The reason was simple — the demand for labour was high and the supply was higher.

No wonder these same workers have now moved the Supreme Court seeking more accountability on these companies’ parts and better working conditions.

Shaik Salauddin, national general secretary of Indian Federation of App-based Transport Workers, that filed the plea in apex court, in a previous conversation with Business Insider highlighted that these platforms had much better offerings when they started off and that is why several workers switched to them. However, as these businesses scaled the conditions of these “partners” deteriorated substantially.

Financial advisory firm Valpro’s director Neha Khanna told Business Insider that as any company scales up, their overhead costs increase as well. This can include marketing expenses, operation costs or more. So cutting a higher percentage out of gig workers is an easier way to generate more revenue, and that is majorly why the gig worker’s conditions depleted further.

While it is still too early to say whether Urban Company is heading out for the same path, it is definitely something that the company as well as the workers have to be cautious about.

In a previous conversation with Business Insider, Urban Company’s co-founder Varun Khaitan assured that they have learnt several lessons from other companies and plan to scale their business sustainably, without eating into the earnings of these partners.

“The Fairwork report highlights that our working model is sustainable,” Khaitan added. Urban Company — valued at $2.1 billion — has over 40,000 service professionals on its platform and plans to add another 15,000 to meet growing demand.



Khanna also noted that Urban Company can never be in such a position to cut off commissions or benefits for its partners. The simple reason behind it is the extent of interaction between a service professional and Urban Company’s customer. While platforms like Uber and Ola or Zomato and Swiggy have limited interaction, there is a lot of potential in leakage in Urban Company’s beauty business to say the least. Services professionals, especially in the beauty segment, can directly get in touch with customers and work with them directly in the future, cutting off Urban Company from the picture.

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