The online cab aggregator industry in India has witnessed exponential growth in the past decade. The increasing customer base can be attributed to the convenience and accessibility provided by these platforms. However, the safety and security of passengers who avail their services, particularly women, is a growing concern.

Several cases of cab drivers sexually assaulting or harassing female passengers have been reported in recent years. In 2014, an Uber driver raped a woman in a cab, leading to a ban on Uber services in Delhi that was later revoked. In another incident, an Ola cab driver was booked for forcing a woman passenger to strip, capturing her pictures and threatening to gang0rape her. A woman also reported to have nearly escaped a sexual assault attempt by an Ola cab driver. Recently, a complaint against an Uber auto-rickshaw driver was filed for sexually harassing a woman. In each of these cases, the aggregators responded by merely blacklisting the drivers and the drivers were booked under various provisions of the Indian Penal Code, 1860.

Amidst the rising cases of violence against women in the country, such incidents exacerbate concerns about the security of women in general. This also raises the question about the responsibility of the online cab service providers towards the safety of women using their app-based taxi services.

This issue was recently brought before the Karnataka High Court in X v. Internal Complaints Committee. In this case, a woman who was subjected to sexual harassment by an Ola driver in Bangalore had submitted a complaint to Ola demanding an inquiry against their driver under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (POSH Act). However, the Internal Complaints Committee (ICC) of Ola refused to conduct any inquiry, stating that their driver partners do not come under the ambit of the term ‘employee’ as defined under the POSH Act. The inaction on the part of the company led the aggrieved woman to file a petition before the High Court. While the petitioner argued that there exists an employer-employee relationship between Ola and its drivers, the company claimed that the drivers are independent contractors and are not employed by Ola. The Court ruled in favour of the petitioner, ordering Ola to initiate an inquiry against the driver under the POSH Act and pay a sum of ₹5 lakh as compensation. This decision has now, however, been temporarily stayed by a division bench of the same Court.

This article reflects upon the possible recourse under law that women can avail of if they experience any form of sexual violence while using these app-based taxi services. The determination of liability and responsibility, however, first requires an examination of the nature of the relationship between the cab aggregators and their drivers.

Relationship between online aggregators and their ‘partners’

Online cab aggregators assert that the cab drivers are independent contractors and not their employees. For instance, the terms and conditions of Uber require users of its app to acknowledge that the transportation services are rendered by “independent third party contractors who are not employed by Uber and its affiliates.” Based on such terms and conditions, the aggregators expressly deny any responsibility for any acts of their drivers. However, the level of control these aggregators can exercise over their drivers, as evident from the provisions describing the relationship between the transport aggregators and drivers, seems to indicate otherwise.

The subscription agreement that governs the relationship between Ola and its drivers shows that the aggregator dictates almost all aspects of drivers’ work, from training and management to supervision and monitoring. As per the agreement, drivers must complete all the training as and when required. Ola alone handles the allotment of bookings, fixing of fares and all types of payment-related issues. Drivers are not allowed to cancel allotted bookings unless there are exceptional circumstances. Ola is free to impose fines and terminate the agreement with immediate effect for different non-compliances, etc. This position was accepted by the Court in X v. Internal Complaints Committee.

"From fixing the ride rates, payment/receipts, commission sharing, deduction, enhancement, change in rates, payment of statutory dues, to determination, resolution and settlement of any disputes including execution and implementation of outcome of such determination is at the sole discretion of the OLA," the Court stated.

Another interesting point to note is that the agreement specifies that the “driver or any Transport Service Provider shall ensure the safety and security of the Customers…” as one of the obligations of the driver. Further, “Rude Behavior with Female Customer” is listed as one of the breaches of the zero-tolerance policy under the agreement.

In 2019, the Motor Vehicles Act, 1988 was amended to bring cab aggregators such as Ola and Uber under its purview. It defined an aggregator as a “digital intermediary or marketplace for a passenger to connect with a driver for the purpose of transportation”. Thereafter, the Central government issued the Motor Vehicle Aggregator Guidelines 2020 to regulate the business operations of transport aggregators or app-based taxi services. These guidelines intend to ensure that the aggregators bear accountability and responsibility for the operations they perform. They include several provisions that allow these platforms to exercise a great extent of control over the functioning of their drivers.

As per the 2020 guidelines, the aggregators are required to make arrangements to test the driving abilities of the driver. The aggregators must conduct a mandatory induction training programme, complete medical examinations, police verification of identity, and a refresher training programme once a year. It is their responsibility to ensure that drivers are not logged in beyond a maximum period of twelve hours in a day, with a ten-hour gap between each login. Before each trip, the identity of the driver must be verified, and the vehicles have to be subjected to regular spot checks. The vehicle must comply with safety features such as GPS, fire extinguisher, disabled child lock mechanism, third-party insurance and other necessary permits and certificates. Further, the aggregators are allowed to levy a penalty on the drivers for cancelling a ride after it has been accepted without any valid justification.

The aggregators need to establish a 24x7 control room to monitor the movements of the vehicles and develop a mechanism to ensure that the driver follows the route indicated on the app. In case a driver deviates from the route, the aggregator is required to immediately communicate the same to the driver. If a driver’s rating falls below two, they must be off-boarded until the completion of a remedial training programme. In addition, the aggregators are also required to set up call centres to facilitate effective redressal of riders’ grievances. On receipt of a complaint against the driver which is criminal in nature or for driving under the influence of drugs or alcohol, the aggregator is required to off-board the driver until the complaint is resolved.

Even before the above Central government guidelines were issued, similar guidelines titled the Karnataka On-demand Transportation Technology Aggregators Rules, 2016 were already in effect in the State of Karnataka to ensure the safety of the passengers and the integrity of aggregation platform operations.

From these guidelines, aggregators can be said to have the power to exercise a significant amount of control over the conduct of business and how work is carried out. The drivers cannot be merely termed independent contractors as they have limited control over the conduct of their businesses. This rather indicates the presence of an employer-employee relationship between the aggregators and the drivers.

Applicability of POSH Act

In X v. Internal Complaints Committee, the aggrieved woman has sought relief under the POSH Act. The ‘aggrieved woman’ under the Act has been specifically defined to include women of any age, whether employed or not with the concerned organisation. Thus, even a female customer or a client subjected to sexual harassment by an employee at a particular workplace can claim protection under this law.

The primary issue in the case before the Karnataka High Court was whether the cab driver could be considered an ‘employee’ of Ola and thereby be subject to the proceedings under the POSH Act. While Ola claimed mere aggregator status and relegated the driver to the status of a third-party contractor, it was difficult for it to evade the wide definition of employee under the POSH Act. The Act covers varied types of employees – “whether regular, temporary, ad hoc or daily wage basis, either directly or through an agent, including a contractor, with or, without the knowledge of the principal employer...." This wide definition is indicative of the legislative intent to ensure that the employer doesn't shy away from their responsibility by claiming no direct relationship with their employee. The Court too, in this case, after discerning the nature of the relationship between the driver and the platform as per the subscription agreement and other factors, ruled that the driver falls under this definition of ‘employee’ and would be thus amenable to proceedings under the POSH Act.

It must also be noted that the penalty imposed on Ola was on account of inaction, that is, for failing to initiate a proceeding against the driver under the POSH Act, and not as liability for the acts of its driver. The driver would have to appear before the ICC of Ola and may face disciplinary action or termination depending on the ICC’s findings. However, since the decision has been stayed for now, the applicability of the POSH Act remains uncertain.

Regardless of the inquiry under the POSH Act, parallel proceedings can also be initiated against the individual driver under criminal law. Criminal law extends to the personal liability of the perpetrator and provides a remedy in the form of imprisonment and a fine for various offences against women such as sexual harassment, insulting or outraging the modesty of a woman, rape, etc. The offence of sexual harassment under the Bharatiya Nyaya Sanhita, 2023 (BNS) covers a wide range of behaviours including unwelcome physical contact, explicit sexual overtures, demand or request for sexual favours, and making sexually coloured remarks. In most cases of offences against women, the court is allowed to divert the fine towards compensating the aggrieved woman.

In the 2014 Uber rape case as well, the driver was convicted for the offences of rape, abduction, intimidation and causing harm. This liability, however, cannot be extended to any company or corporate entity.

Liability of intermediaries

The Information Technology Act, 2000 exempts intermediaries from liability when their only role is to provide access to a communication system. It was argued before the Karnataka High Court that Ola performs the limited function of providing a platform for storing and sharing the information of the driver and the rider, and hence is exempt from any liability.

However, as discussed above, on the application of the test of degree of control, the argument that the aggregators just act as intermediaries between the drivers and passengers does not stand. We cannot completely rule out an employer-employee relationship between the aggregators and their drivers. It is a well-settled principle of law that employers are liable for the acts of their employees, but not independent contractors. The principle of vicarious liability holds that an employer can be held liable for the wrongful acts committed by their employees. Thus, it can be argued that the aggregators are vicariously responsible for the wrongful acts of their drivers. The existence of an employer-employee relationship opens an option of filing a claim for damages against the aggregators in a civil court.

Further, customers using app services have reasonable expectations of safety and security whilst using their services. Thus, when a service provider provides an unsafe environment for the customer, causing them harm, it can be said to be a deficiency in service, making the service provider liable under consumer law. The Consumer Protection Act, 2019 entitles 'consumers’ of any goods or services to seek timely and effective redressal of consumer disputes. A consumer complaint under the Act can be made against the service provider for ‘deficiency of services.’ The deficiency can be in the quality, nature and manner of performance of the contractor or commission of any such act or omission that causes loss or injury to the consumer.

Currently, the consumer courts are considering cases of attributing liability to online aggregators in similar cases of sexual harassment by their ‘partners’, considering it a deficiency of service by the service provider aggregator. In 2023, a notice was issued to Zomato by the district consumer forum for alleged sexual harassment by one of its delivery partners. Dunzo also faced a similar claim of ₹50 lakh before a consumer forum on account of failure to meet reasonable consumer safety expectations, among other grounds.

While the orders in these cases are awaited, it is time to reassess whether these aggregators, who otherwise exert substantial control over their ‘partners’, are evading the law on hypertechnical grounds, distancing themselves as per convenience.

Manisha Aswal is a Ph.D. Scholar at National Law University, Delhi.

Sarab Lamba is a Research Associate at the Centre for Law, Justice and Development, National Law University, Delhi.